BDC offering more loans to Canadian companies, fiscal report says

The Business Development Bank of Canada has given out more money in the past year than in 2015, but it has also seen more money come back in its net income, a new fiscal report says.

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"Our lending is up, the size of our portfolio is up, our net income is up, so overall, it was a good year for us in terms of our growth. And why that's important to me is that reflects the vibrancy of entrepreneurship in Canada, said Michael Denham, BDC president and CEO.

"Our growth is a reflection of the fact that [entrepreneurs have] got lots of ideas, lots of initiatives and lots of ways to use the financing."

Loans, earnings up

The report notes that the the BDC, which is a federal crown corporation, committed $4.8 billion in loans in the fiscal year ending March 31. That's up from $4.7 billion in 2015.

The bank earned $537.7 million in net income, up from $490.7 million in fiscal 2015. That means it will pay a dividend of $68.6 million to the federal government, and profits will be reinvested into the BDC.

Denham said that growth shows the corporation is taking the right steps to support entrepreneurs. He said client satisfaction levels are high and the BDC continues to look for new ways to work with entrepreneurs as an attractive financial partner.

Support 'instrumental' for business

Funding from the BDC has helped companies like AGS Automotive in Cambridge, Ont, which is perhaps best known for its chrome bumpers for pick-up trucks. Company Co-president Joe Loparco said despite being an established company, AGS doesn't always have the funds to be competitive on the world stage.

There's a growing realization that manufacturing is back and is plays a huge spillover effect on the economy.- Joe Loparco, AGS Automotive

He said the BDC was there for his company when the automotive sector took a hit in 2009 and 2010.

"It's good to see the sector growing and it's good to have the support of an institution like BDC that sees the importance of manufacturing for our economy," he said.

"I think that role that BDC plays is instrumental. I think that there's a growing realization that manufacturing is back and it plays a huge spillover effect on the economy, in terms of creating jobs, and therefore that's something we need to continue to nurture and grow."

Investments important for country

Loparco said he has seen the automotive and technology sectors converging in Waterloo region. 

He said the automotive sector is able to leverage information technology capabilities from companies based here, and it helps give them a competitive edge.

Denham said it is important Canadian companies be given that opportunity so they can take their products beyond the country.

"It's important for Canada that our companies innovate, it's important for Canada that our companies invest to become more productive, and it's important for Canada that our companies sell internationally because that's where the markets are, that's where a lot of the growth is," he said.

"It's what's going to make Canada a more vibrant, more growing country and our role is to help businesses contribute to that."