(Bloomberg) -- Canadian business loans grew at the fastest pace since 1981 in March as companies tapped credit lines to get them through the coronavirus crisis.
Loans to businesses rose 54% annualized to C$949.2 billion ($668 billion), according to Bank of Canada data. The increase is the sharpest since 1981, reflecting the rush to borrow to stay afloat as countrywide shutdowns crushed revenue.
The spike in loan demand illustrates why Bank of Canada officials took such swift action to inject liquidity into credit markets by rolling out massive asset purchase programs. Last week the central bank's balance sheet swelled to a record C$384 billion -- around 16% of the country's gross domestic product -- as the bank upped its buying of bonds and treasury bills and widened the scope of repurchase agreements. That's more than three times the size of the balance sheet at the beginning of March.
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Total business credit, which also includes debt and equity, increased 18% annualized in March from the prior month, the data show.
©2020 Bloomberg L.P.
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