TORONTO (Reuters) - Commercial borrowing by small and medium-sized businesses in Canada rose slightly in the first quarter as modest growth in the agriculture and construction industries helped offset weakness in the energy sector, data from PayNet showed on Tuesday.
PayNet, which tracks commercial financing for millions of small and medium-sized businesses in North America, said its Canadian Business Lending Index rose to 206 in the first quarter from 204 in the fourth quarter.
The improvement in the lending climate comes after declines in the four previous quarters, when a sluggish economy and weak resource prices weighed.
“This growth is due to more discretionary money in the hands of consumers as a result of the lower energy prices such as gasoline to fuel their cars and natural gas to heat homes,” Bill Phelan, president of PayNet, said in an email.
“The go-go days in oil exploration and production are on hold for a while,” he added. “The move from west to east and from energy producing to consumer based business is underway.”
Moderate loan delinquencies - those that are behind in payments by 30 days or more - climbed to 2.7 percent of loans in March, from 2.6 percent in the previous month and 2.2 percent in December.
Loans that were more than 90 days late, which are considered loans in severe arrears, stood at 0.7 percent, compared with 0.5 percent in December.
Editing by Jeffrey Hodgson and Alan Crosby