Reserve Funds

September 7, 2022 Published by London and Area Chapter - By Jeff Runnalls, CPA, CA, RDBA

A Looming Threat for Condo Reserves

From the CCI Review 2022/2023-1 September 2022 issue of the CCI London Chapter

Canada’s inflation rate hit a 39 year high of 8.1% - A looming threat for Condo Reserves – How can a Registered Deposit Broker help?

With soaring inflation, dynamic interest rates and market turbulence, there are actions that Condominiums must take now to position their Reserve Funds to persevere. A Registered Deposit Broker, who typically operates on a no cost or commitment basis, and specializes in the Condominium Market may be the best ally.

When Condominium Reserve Fund Studies get updated in 1-3 years, with the current inflation environment, there could be a 26% surprise awaiting; and, that’s in addition to the likely 9% increase already contemplated. Yes, a 35% increase could be awaiting boards and owners if no action is taken, and that’s just for Reserve Fund contributions.

Managing Reserve Funds is one of the central responsibilities of Condominium Boards. Condominiums can invest in Federal or Provincial CDIC/DICO insured GICs, but far too often funds are left in a bank account, earning essentially zero interest. When Condominiums do invest in GICs they typically leave 1.20% to 2.00% on the table by not seeking out the best CDIC/DICO insured rates or terms, which typically translates to 5-10% of condominium fees. Lastly – CDIC and DICO insurances have their limits, currently $100,000 and $250,000 per Corporation at each individual Financial Institution. Although the failure of a financial institution currently seems remote, it is a factor to consider.

Opening accounts and having relationships with many financial institutions is next to impossible for a Condominium Corporation. If only there was a way to easily have access to multiple Financial Institutions at the tip of your finger – wait for it – that’s where a Registered Deposit Broker specializing in the condominium Market comes into play. A Registered Deposit Broker who specializes in condominiums can look at the reserves on hand, the Reserve Fund Study, planned expenditures, and the interest rate outlook, and build a CDIC/DICO insured GIC portfolio that maximizes returns, insures amounts and insures liquidity for planned expenditures, all at the same time – typically for no cost or commitment. By onboarding with a Registered Deposit Broker, you get access to all Financial Institutions they work with, often at better than posted rates.

Your Condominium is a profit machine for your current financial institution. Where else are there hundreds of thousands, perhaps millions, of dollars essentially locked into their bank accounts or GICs? With current inflation, it has never been more important to take proactive steps to manage reserve funds. Condo Boards are not alone, seek out the assistance of Property Managers and other professionals, including speaking to a Registered Deposit Broker specializing in the Condominium Market.

For more information, visit the website;

Or , you can reach out to Jeff here: Jeffrey Runnalls <>

Jeff Runnalls, CPA, CA, RDBA is President at Lambda Financial Consulting Inc. Lambda specializes in Condominium deposit brokerage, with a no cost or commitment platform that facilities Condominiums to maximize their GIC returns and CDIC/DICO insured amounts through access to exclusive rates based upon Lambda’s entire volume and transaction simplicity from 25+ Financial Institutions.

Jeff also has real world experience as a Condominium owner and Board Director since 2010.


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