Canadian commercial lending hits 3-year high: PayNet
By Claire Sibonney
TORONTO (Reuters) - Canadian commercial lending activity surged to its highest level more than in three years in the second quarter, a signal the country's smaller companies are supporting its tepid recovery through investment.
PayNet, which tracks commercial financing to thousands of North American small and medium-sized businesses, said on Wednesday its Canadian Business Lending Index rose 9 percent from the first quarter and 22 percent year over year.
"It's across the country," said Anthony Zambon, director of PayNet Canada. However, he noted that activity in Western Canada was especially robust due to strong international demand for the region's oil and other natural resources.
"These companies need to replace their machinery and equipment to keep operating. They had gotten to a stage where they've held off on this investment ... so there's a pent up need."
The commercial finance sector includes non-bank players such as machinery makers, whose loans and leases to customers are secured against the equipment sold.
The data marked the seventh consecutive quarter of growth since bottoming out in 2010, and the fourth straight double-digit advance on a year-over-year basis.
The Canadian PayNet index rose to 166, its highest reading since the first quarter of 2009. The number contrasted sharply with the corresponding U.S. index, which at around 100 was up only 2 percent quarter over quarter and 4 percent year over year.
"We're still maintaining growth which is twice as fast as U.S. growth," added Zambon. Continued...