OTTAWA (Reuters) - Finance Minister Jim Flaherty said on Tuesday he saw some positive signs that credit conditions in Canada were improving, despite serious strains in some segments of the funding market.
"I think we are seeing some small signs of little progress ... we're seeing some improvement in credit spreads, for example. We're seeing some small improvements in certain retail sectors. This is progress," he said in an interview with BNN television.
However, he noted that the terms and conditions for funding of some small businesses and projects were still prohibitive and urged banks to do their part to loosen credit.
In coming days Flaherty is expected to announce the creation of an advisory committee to help him identify trouble spots in the credit market so the government can target extraordinary financing, already announced in the budget, to those areas.
Flaherty will meet individually with chief executives of the country's major banks and life insurers over the next two weeks, he said.
In order to bolster financial regulation in compliance with commitments to the G20 powers, Canada will have to replace its system of provincial securities regulators with a single national regulator, Flaherty said, calling the current system a "glaring flaw" internationally.
Stimulus spending should be rolling out in Canada over the next 90 days and, by summer, Ottawa will assess the impact of its fiscal plans and the health of credit markets before deciding whether to take additional action to help the economy, Flaherty said.
"We'll do whatever we have to do to ease the way for Canada out of this recession and come out of it strongly."
Reporting by Louise Egan; editing by Rob Wilson