OTTAWA - Lending activity to small businesses in Canada picked up in November on gains in the manufacturing and retail sectors, a report showed on Tuesday, suggesting companies felt more confident with the U.S. election out of the way.
The PayNet Canadian Small Business Lending Index rose to 119.9 from 116.5 in October, while lending to medium-sized firms increased to 218.3 from 211.3.
While uncertainties still remain as to what policies U.S. President-elect Donald Trump will enact, the November bump in lending points to the removal of at least one uncertainty, PayNet President Bill Phelan said.
The United States is Canada's biggest trading partner. Although business lending in Canada weakened in much of 2015 and 2016 in the wake of the oil price crash, November's gain suggests a trough has been made, Phelan said.
"Once you can stabilize the economy, you can position it for growth," he said.
Lending to manufacturers, a sector economists have looked to as an offset to the slump in the oil patch, rose to 66.3 from 65.8. The retail sector jumped to 185.7 from 178.2.
Delinquencies continued to show companies were in strong financial health, with the amount of businesses that were 30 days or more behind on loans falling to 1.09 per cent from 1.11 per cent.
Companies that were 90 days or more behind on loans held steady at 0.37 per cent.