Canadian Manufacturing

Finance Minister Morneau, big banks announce $1B small biz growth fund

The need to help small and medium-sized businesses secure capital has become a growing topic of conversation in financial and political circles



TORONTO—The federal government and Canada’s big banks have announced a fund worth up to $1 billion over 10 years intended to help small- and medium-sized businesses access capital so they can expand operations.

The government and the banks say the pool of money would initially set aside more than $500 million for the first year, with the possibility of that doubling over the next nine years, depending on demand for investment and the fund’s performance.

The announcement follows a recommendation issued last month by a federal panel advising Finance Minister Bill Morneau on economic growth.

The need to help small- and medium-sized enterprises secure money to grow has become a growing topic of conversation in financial and political circles lately.

During a speech to the Canadian Club of Toronto last month, CIBC CEO Victor Dodig spoke of how such a fund would invigorate the economy.

He said CIBC has been in talks with the federal government and other financial institutions about creating a “sizeable” Canadian business growth fund, financed by the private sector, for small- and medium-sized enterprises.

“What’s interesting about the business growth fund in Canada is that it’s a private sector initiative,” Dodig said.

“It’s financial institutions coming together to help the small- and medium-sized business sector and generate a return for our shareholders, and the government has simply come together to convene us to say, ‘We think this is a good idea, we think you should go do this.”’

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