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PayNet: Canadian Commercial Investment Stabilizing in August

October 19, 2016, 07:05 AM
Filed Under: Economy

PayNet, the premier provider of credit assessments on private companies reports the PayNet Canadian Small Business Lending Index (CSBLI) increased 4% to 123.2 in August 2016 from 118.8 in July 2016. That is the largest increase in the Index since September 2013. Compared to the same month one year ago, the Index is down 6%.
With investment increasing 16% compared to a year ago, Manufacturing is picking up where energy left off to become one of the new growth engines for the Canadian economy. Transportation remains in heavy contraction mode at -19%, which is the same as the prior 3 months. The pace of decline has slowed out west with Alberta at -18% versus -22% over the past 6 months.
“In a sign of relief for the Canadian economy, the reduced rate of contraction in business investment means the worst may be over for the slow growth economy,” states William Phelan, president PayNet. “Small business investment is no longer in the double digit free fall we've been witnessing since the early part of this year.”
The PayNet Canadian Small Business Delinquency Index 31-180 days past due decreased 5 bps from 1.17% in July 2016 to 1.12% in August 2016. As compared to one year ago, delinquency increased 8 bps. Wholesale delinquency rose 8% (12 bps), but Accommodation & Food fell 17% (82 bps) and Transportation fell 10% (14 bps). Besides Sasketchewan, which increased 4% (3 bps), every other province had a decrease in delinquency from July 2016 to August 2016.
“The rotation into non-energy businesses is helping the Canadian economy,” Phelan added.  “The financial health of Canadian businesses will contribute to a faster growing economy as fewer businesses have had to close their doors than in prior recessions.”

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