The Business Development Bank of Canada (BDC; ) is a

Crown corporation Crown corporation () is the term used in Canada for organizations that are structured like private companies, but are directly and wholly owned by the government. Crown corporations have a long-standing presence in the country, and have a sign ...

and

national development bank A national development bank is a development bank created by a country's government that provides financing for the purposes of economic development of the country. Africa * Botswana: National Development Bank of Botswana (NDB Botswana) * Ethiopia ...

wholly owned by the

Government of Canada The Government of Canada (), formally His Majesty's Government (), is the body responsible for the federation, federal administration of Canada. The term ''Government of Canada'' refers specifically to the executive, which includes Minister of t ...

, mandated to help create and develop Canadian businesses through financing, growth and transition capital,

venture capital Venture capital (VC) is a form of private equity financing provided by firms or funds to start-up company, startup, early-stage, and emerging companies, that have been deemed to have high growth potential or that have demonstrated high growth in ...

and advisory services, with a focus on

small and medium-sized enterprises Small and medium-sized enterprises (SMEs) or small and medium-sized businesses (SMBs) are businesses whose personnel and revenue numbers fall below certain limits. The abbreviation "SME" is used by many national agencies and international organiza ...

. Founded in 1944, its corporate headquarters is located in Montreal and it has more than 123 business centres working with 60,000 clients.BDC Annual Report, 2017
Retrieved 2018-01-23 BDC's

debt Debt is an obligation that requires one party, the debtor, to pay money Loan, borrowed or otherwise withheld from another party, the creditor. Debt may be owed by a sovereign state or country, local government, company, or an individual. Co ...

obligations, secured by the Government of Canada, are issued to

public In public relations and communication science, publics are groups of individual people, and the public (a.k.a. the general public) is the totality of such groupings. This is a different concept to the sociology, sociological concept of the ''Öf ...

and

private sector The private sector is the part of the economy which is owned by private groups, usually as a means of establishment for profit or non profit, rather than being owned by the government. Employment The private sector employs most of the workfo ...

institutions.

History

The bank was established by an Act of Parliament as the Industrial Development Bank (IDB) in September 1944. IDB was initially an arm of the

Bank of Canada The Bank of Canada (BoC; ) is a Crown corporations of Canada, Crown corporation and Canada's central bank. Chartered in 1934 under the ''Bank of Canada Act'', it is responsible for formulating Canada's monetary policy,OECD. OECD Economic Surve ...

, and the Governor of the Bank was also Chief Executive Officer of the IDB. During its first years, the bank's main role was to help small "industrial enterprises" convert from military production to peacetime operations after World War II. IDB was one of the first and largest development banks in the world. The ''Industrial Development Bank Act'' was first amended in 1952 to allow the bank to offer financing to companies in the commercial airlines industry. By the mid-1950s, one in ten planes in Canada was financed by IDB. Later, the ''Industrial Development Bank Act'' was amended twice more to allow the bank to lend to companies in almost all industries. By 1964, 20 years after its foundation, IDB had 22 branches across Canada, covering main cities such as Halifax,

Montreal Montreal is the List of towns in Quebec, largest city in the Provinces and territories of Canada, province of Quebec, the List of the largest municipalities in Canada by population, second-largest in Canada, and the List of North American cit ...

Toronto Toronto ( , locally pronounced or ) is the List of the largest municipalities in Canada by population, most populous city in Canada. It is the capital city of the Provinces and territories of Canada, Canadian province of Ontario. With a p ...

Winnipeg Winnipeg () is the capital and largest city of the Provinces and territories of Canada, Canadian province of Manitoba. It is centred on the confluence of the Red River of the North, Red and Assiniboine River, Assiniboine rivers. , Winnipeg h ...

Calgary Calgary () is a major city in the Canadian province of Alberta. As of 2021, the city proper had a population of 1,306,784 and a metropolitan population of 1,481,806 making it the third-largest city and fifth-largest metropolitan area in C ...

and

Vancouver Vancouver is a major city in Western Canada, located in the Lower Mainland region of British Columbia. As the List of cities in British Columbia, most populous city in the province, the 2021 Canadian census recorded 662,248 people in the cit ...

, including operations in relatively rural areas. In the mid-1970s, the bank added consulting and training to its financial offerings to help entrepreneurs better manage their businesses. In 1975, its name was changed to Federal Business Development Bank (FBDB), and its

operations were started. At the time, the bank was known as "a

lender of last resort In public finance, a lender of last resort (LOLR) is a financial entity, generally a central bank, that acts as the provider of liquidity to a financial institution which finds itself unable to obtain sufficient liquidity in the interbank ...

"—supporting businesses in difficulty. In 1995, the '' Business Development Bank of Canada Act'' was passed, leading to a new name and mission for the bank. It mandated BDC to promote

entrepreneurship Entrepreneurship is the creation or extraction of economic value in ways that generally entail beyond the minimal amount of risk (assumed by a traditional business), and potentially involving values besides simply economic ones. An entrepreneu ...

, focusing on the needs of small and medium-sized enterprises (SMEs), to fill gaps in the market and maximize financing alternatives for businesses by offering services that were complementary to those available from other

financial institutions A financial institution, sometimes called a banking institution, is a business entity that provides service as an intermediary for different types of financial monetary transactions. Broadly speaking, there are three major types of financial ins ...

. BDC is financially self-sustaining. Since 1998, it has been profitable and paid a total of more than $746 million in dividends to its sole shareholder, the Government of Canada. On June 8, 2022, BDC’s Board of Director authorized the repurchase of $5.0 billion of its common shares. Every ten years, the Minister of Industry must conduct a review of the provisions and operations of the BDC Act. The last legislative review was completed in December 2014. In April 2021, the Bank announced the appointment of Isabelle Hudon as President and Chief Executive Officer as of August of the same year, at the end of the term of current CEO Michael Denham. In 2023, current and former staff raised concerns about spending at the bank, including expenditure on consulting services from

McKinsey & Company McKinsey & Company (informally McKinsey or McK) is an American multinational strategy and management consulting firm that offers professional services to corporations, governments, and other organizations. Founded in 1926 by James O. McKinse ...

and air transport for a private

chauffeur A chauffeur () is a person employed to drive a passenger motor vehicle, especially a luxury vehicle such as a large sedan or a limousine. Initially, such drivers were often personal employees of the vehicle owner, but this has changed to s ...

Services

BDC offers loans and advisory services with a focus on small and medium-sized companies. It reports to Parliament through the Minister of Innovation, Science and Economic Development. BDC Capital, a subsidiary of BDC, offers specialized financing, including venture capital, equity as well as growth and business transition capital. BDC's Venture Capital arm makes strategic investments in Canadian companies through its Energy/Cleantech Fund, Healthcare Fund and IT Fund. Notable investments include GradeSlam, Q1 Labs, Radian6, Canopy Labs,

D-Wave Systems D-Wave Quantum Inc. is a quantum computing company with locations in Palo Alto, California and Burnaby, British Columbia. D-Wave claims to be the world's first company to sell computers that exploit quantum effects in their operation. D-Wa ...

, CoolIT Systems, Protiva Biotherapeutics, Sanctuary AI and Klipfolio Dashboard. BDC is a complementary lender, offering

commercial Commercial may refer to: * (adjective for) commerce, a system of voluntary exchange of products and services ** (adjective for) trade, the trading of something of economic value such as goods, services, information or money * a dose of advertising ...

loans and

investments Investment is traditionally defined as the "commitment of resources into something expected to gain value over time". If an investment involves money, then it can be defined as a "commitment of money to receive more money later". From a broade ...

that fill out or complete services available from

private-sector The private sector is the part of the economy which is owned by private groups, usually as a means of establishment for profit or non profit, rather than being owned by the government. Employment The private sector employs most of the workforce ...

financial institutions. It also provides advice to businesses through its advisory services division. Launched by FBDB in 1979, Small Business Week is a yearly celebration of entrepreneurs and their contribution to Canadian society. It became a nationwide event in 1981.

Tax Exemption

BDC is exempt from taxes imposed by the Income Tax Act.

Recognition

BDC was named among Canada's Top 100 employers from 2007 to 2018. BDC Capital won multiple Deal of the Year Awards from the Canadian Venture Capital and Private Equity Association in the venture capital category. It won in 2011, for its investment in Radian6 Technologies Inc.; in 2012, for its investment in Q1 Labs Inc.; and again in 2014, for its investment in Layer 7 Technologies.

References

External links

Official website
{{authority control Banks of Canada Federal departments and agencies of Canada Canadian federal Crown corporations Companies based in Montreal Banks established in 1944 1944 establishments in Quebec Benefit corporations Small business Innovation, Science and Economic Development Canada B Lab-certified corporations

Canada Canada is a country in North America. Its Provinces and territories of Canada, ten provinces and three territories extend from the Atlantic Ocean to the Pacific Ocean and northward into the Arctic Ocean, making it the world's List of coun ...