Big bank, insurance CEOs announce new business growth fund of up to $1B
Finance Minister on hand to unveil fund worth $500 million at launch but may grow to $1B
Federal Finance Minister Bill Morneau and some of Canada's biggest banks and insurance companies today unveiled a $1-billion fund aimed at helping small- and medium-sized businesses access cash to help them grow.
Morneau and CEOs of the big banks and insurers announced the creation of the Canadian Business Growth Fund in Toronto on Thursday morning.
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Initially, the fund will have $500 million worth of the big companies' money at its disposal, to invest in small companies in increments of between $3 million and $20 million. But that money will grow over time to as much as $1 billion to deploy over the next decade.
The fund "will help ambitious Canadian companies get the capital they need to grow and succeed globally," Morneau said in a release.
Many of Canada's biggest financial names are participating including:
- Royal Bank.
- TD Bank.
- Sun Life.
- Great-West Life.
- National Bank.
- ATB Financial.
- Laurentian Bank.
- Canadian Western Bank.
While backed by fierce Bay Street rivals, the fund will operate as an independent managed entity, with its own board of directors made up of people from the backing firms.
CIBC president Victor Dodig said in a recent speech to the Canadian Club last month that such a fund would invigorate the economy.
He said CIBC has been in talks with the federal government and other financial institutions about creating a "sizable" Canadian business growth fund, financed by the private sector, for small- and medium-sized enterprises.
With files from The Canadian Press