Renovations to Dawson City's historic CIBC bank are on hold until its lead paint and asbestos can be dealt with.

The town recently received a hazardous materials report prepared by Energy North Construction.

Jeff Renaud, Dawson City's Chief Administrative Officer, says the report reveals a significant amount of asbestos and lead paint in the building.

"We originally investigated the total removal of the hazardous materials," he said.

"That was proven to be beyond the financial capabilities of the project at this time, so the project team has moved their focus toward encapsulation, the sealing off of the material."

Renaud says once the material is sealed off, the restoration work can get underway.

The town bought the building from former owner Mike Palma for $170,000 earlier this year.  

The branch opened in 1898 during the gold rush. Poet Robert Service worked at the bank in 1908 following a stint at the bank's Whitehorse branch.