The Canadian government is moving forward with a plan to merge Export Development Canada (EDC) and the Business Development Bank of Canada (BDC), aiming to create a powerful financial entity that can nurture domestic corporate champions with global reach. The combined entity, which will oversee $128-billion in assets and employ 5,100 people, is intended to bolster industries such as critical minerals, energy transition, and artificial intelligence. While details like the new entity's name, leadership, and launch date remain unclear, the merger is part of a broader strategy to consolidate federally backed financing agencies under the Minister of Finance.
Alison Nankivell, CEO of EDC, emphasized that the merger is not about cost-cutting but about creating a larger balance sheet to reallocate resources more effectively. She highlighted the need for Canada to focus on industries where it has competitive strengths, such as forestry and agri-food, to boost its global scale. The merger follows a trend seen in countries like France, Japan, and China, where government-backed financial resources are concentrated to strengthen the economy.
Tushar Handiekar, EDC’s vice-president of structured and project finance, noted that the new entity will require a greater appetite for lending risk, potentially partnering with export trade agencies or insurance companies to share that risk. Nankivell expects the combined entity to see an increase in the value of assets it oversees, as it finances more companies to expand internationally. The merger is seen as a response to the changing dynamics of trade with the United States, which has disrupted traditional supply chains.