Biannual Survey of Suppliers of Business Financing—Data analysis, 2011

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October 2012

This document represents the first Industry Canada release of information from the new Biannual Survey of Suppliers of Business Financing. The survey collects data on business lending activities.

Overall conditions

Survey results reflect an overall increase in business lending activity over the second half of 2011. In total, lendersdisbursed approximately $65 billion in new loansFootnote 1 to Canadian businesses between July and December (H2), compared with approximately $62 billion in new loans disbursed between January and June (H1) (Figure 1). This translates into an increase in new loan activity of approximately 5.1 percent. Survey results are consistent with an overall loosening in business lending conditions as reported in the Bank of Canada's Senior Loan Officer Survey.Footnote 2

Business size conditions

Based on survey findings, lending activity for businesses of all sizes increased over the second half of the year.The increase was most pronounced among large businesses (those with loan authorization levels above $5 million) to which lenders disbursed over $41 billion in new loans. This represented a 5.9-percent increase in loan disbursals over the first half of the year. Similarly, lending activity increased for small businesses (those with loan authorization levels below $1 million) and medium-sized businesses (those with loan authorization levels of $1 million or more but less than $5 million), with loan disbursals rising by about 4.2 percent and 3.2 percent respectively (Figure 2).

Lending activity

Lending activity increased across most financial institutions in the second half of 2011. Finance companies increasedloan disbursals by a high of 17.5 percent over the second half of the year compared with the first half (Table 1). This was followed by domestic banks at about 12.2 percent and credit unions and Caisses populaires at about 10.0 percent. Insurance companies and portfolio managers increased loan disbursals the least (6.9 percent), with new loans disbursed rising from about $5.6 billion in the first half of the year to $6.0 billion in the second half. "Other banks," a category of lenders that includes primarily foreign banks, saw lending activities decrease in the second half of the year, with new loans disbursed falling from about $15.6 billion in the first half of the year to $13.2 billion in the second half, representing a decrease in new loan activity of approximately 15.5 percent.

Table 1: Value of credit disbursed ($ millions) by supplier type
Supplier type2011Change (%)
H1H2
Source: Statistics Canada, Biannual Survey of Suppliers of Business Financing, 2011.
Domestic banks26,72629,99412.2
Other banks15,60913,191−15.5
Credit unions, Caisses populaires6,7457,41910.0
Finance companies6,8768,08117.5
Insurance companies and portfolio managers5,5785,9646.9
All suppliers61,53364,6485.1

Industry conditions

Survey findings point to an increase in lending activity across most sectors in the last six months of 2011. Sectorsexperiencing the highest increases were the primary and agricultural sector, professional services sector andtransportation sector, which saw increases in loan disbursals of 18.9 percent, 13.4 percent and 12.0 percent respectively (Figure 3). Firms in the manufacturing sector; wholesale and retail trade sector; and finance, insurance, real estate and rental sector also experienced an increase in lending activity. Conversely, a decline in lending activity was observed in the construction sector, and accommodation and food services sector. Specifically, new loans disbursed to construction businesses fell by about 4.6 percent from $6.5 billion in the first half of 2011 to $6.2 billion in the second half. Loan disbursals to the accommodation and food services sector fell most sharply, declining by 33.7 percent in the second half of the year from $2.4 billion to about $1.6 billion.

About the Survey

The Biannual Survey of Suppliers of Business Financing is the result of a commitment by the Government of Canada to improve the availability of information about financing of businesses in Canada. Data are collected from 120 major suppliers of financing, including domestic banks and credit unions and Caisses populaires, representing over 90 percent of all lending to businesses in Canada. Data are collected through an electronic questionnaire. Survey results provide baseline statistics to quantify and monitor changes in Canadian business lending activity.

Figure 1: Value of credit outstanding ($ billions) and value of credit disbursed ($ billions)

Figure 1: Value of credit outstanding ($ billions) and value of credit disbursed ($ billions)
Source: Statistics Canada, Biannual Survey of Suppliers of Business Financing, 2011.
Description of Figure 1
Figure 1: Value of credit outstanding ($ billions) and value of credit disbursed ($ billions)
CreditH1 2011H2 2011
Outstanding492.0514.3
Disbursed61.564.6

Figure 2: Value of credit outstanding ($ billions) and value of credit disbursed ($ billions) by size of business

Figure 2: Value of credit outstanding ($ billions) and value of credit disbursed ($ billions) by size of business
Source: Statistics Canada, Biannual Survey of Suppliers of Business Financing, 2011.
Description of Figure 2
Figure 2: Value of credit outstanding ($ billions) and value of credit disbursed ($ billions) by size of business
H1 2011H2 2011
Small businesses
Credit outstanding88.389.9
Credit disbursed9.710.2
Medium-sized businesses
Credit outstanding105.6110.9
Credit disbursed12.713.1
Large businesses
Credit outstanding298.1313.5
Credit disbursed39.141.4

Figure 3: Value of credit outstanding ($ billions) and value of credit disbursed ($ billions) by industry

Figure 3: Value of credit outstanding ($ billions) and value of credit disbursed ($ billions) by industry
Source: Statistics Canada, Biannual Survey of Suppliers of Business Financing, 2011.
Description of Figure 3
Figure 3: Value of credit outstanding ($ billions) and value of credit disbursed ($ billions) by industry
H1 2011H2 2011
Primary and agriculture
Credit outstanding78.987.2
Credit disbursed10.112.0
Construction
Credit outstanding39.640.8
Credit disbursed6.56.2
Transportation
Credit outstanding20.520.7
Credit disbursed2.73.1
Manufacturing
Credit outstanding45.940.3
Credit disbursed5.45.8
Wholesale and retail trade
Credit outstanding54.356.4
Credit disbursed5.25.6
Finance, insurance, real estate and rental
Credit outstanding131.2141.6
Credit disbursed15.515.7
Professional services
Credit outstanding14.317.0
Credit disbursed1.92.2
Accommodation and food services
Credit outstanding14.014.9
Credit disbursed2.41.6