What is Bank Investment Contract?

A Bank Investment Contract (BIC), also referred to as a Bank Deposit Agreement, is a security or portfolio of securities that offers a guaranteed rate of return. As the name suggests, the guaranteed rate in the contract is ensured by the bank for a given period of time, normally 10 years. Typically, investors that acquire a Bank Investment Contract are more interested in maintaining wealth rather than increasing it, as its generally low-risk with a low-yield.