Commercial bank loans drop $2.6 billion in September

The quantum of outstanding Canadian commercial bank loans dropped by another $2.6 billion during the month of September, the largest one month decrease since January 2009. This came on the heels of August data which suggested a slowing in the decline of business loans to the Canadian corporate and SME sector.

The category is “Business loans to Canadian residents for business purposes”, and the data is from the Bank of Canada:

December: $191.967 billion
January: $186.086 billion
February: $184.168 billion
March: $184.5 billion
April: $182.228 billion
May: $180.619 billion
June: $178.301 billion
July: $176.61 billion
August: $175.738 billion
September: $173.118 billion

Commercial and corporate lending by chartered banks to Canadian-based businesses is down $18.8 billion year-to-date, or 9.8% of what was outstanding as of December 2008. The bland drop in August outstandings made one think that the worm was turning and that the availability of commercial credit was “not getting worse”.

Clearly that’s not the case.

MRM