Business as usual at BDC

Author: Michele Lawson

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Despite the credit crunch, it’s business as usual for the Business Development Bank of Canada (BDC) that continues with its mission to partner with businesses to help them grow, says new branch manager Kevin Coleman.
“Essentially we are a development bank,” Coleman explains. “We are a niche and complementary lender to the charter banks. Our mandate is to help Canadian businesses and entrepreneurs grow by helping them with financing.”
The Barrie location of the BDC, which was established in 1944, is one of 94 Canadian branches across the country.
“Being a crown corporation, we’re not there to compete head-to-head with the chartered banks, we’re there to fill in the gap,” says Coleman.
On the lending side, the BDC is interested in providing funding for real estate, equipment financing and working capital.
“With real estate, we provide construction financing and/or long-term mortgages,” he says.
The BDC also has a staff of business experts who provide consulting services independent from the financial group, and who are networked to a team of specialists they can bring in if necessary.
“We always seek opportunities to meet businesses who may benefit from our consulting services group,” he adds. “But being a consulting client does not guarantee financing.”
However, not all companies who come in for a consultation require funding. Conversely, some who come in for loans get referred for consulting services.
“The BDC branch has targets that we have to meet,” he continues, but no one is on commission and the targets are as much about number of clients serviced as it is about the size of the loan. “We have requirements to seek out consulting referrals as well.”
The current economic client has not been lost on those at the BDC.
“Every financial institute in the country has been affected like that,” says Coleman. “But because we’re a crown corporation, our mandate is to consistently provide financing opportunities in good times and in difficulties.
“We have increased our credit due diligence and we’re making sure we’re supporting strong companies,” he admits, “(but) our mandate hasn’t changed because there is an economic downturn – the BDC is still very much open for business.
“We’re not a saviour. If there’s a business opportunity that has a good business plan and they have solid management, solid investment in the project, the ability to service the debt and adequate security, we’re still there to entertain good opportunities.”
In fact, because of the credit tightening at the banks, the BDC is “seeing increased activity of late.”
For more information, call the BDC at 705-725-2533.