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According to data released by the Bank of Canada, commercial and corporate lending by Canadian Chartered banks skyrocketed by more than $4.7 billion in October. That’s the largest one month jump since we began tracking the data almost two years ago. The category is “Business loans to Canadian residents for business purposes”:

  • December 2008: $191.563 billion

  • January 2009: $185.679 billion

  • February: $183.759 billion

  • March: $184.089 billion

  • April: $181.811 billion

  • May: $180.191 billion

  • June: $177.865 billion

  • July: $176.164 billion

  • August: $175.318 billion

  • September: $172.652 billion

  • October: $172.592 billion

  • November: $169.928 billion

  • December: $170.930 billion

  • January 2010: $169.423 billion

  • February: $169.604 billion

  • March: $170.959 billion

  • April: $170.663 billion

  • May: $167.878 billion

  • June: $166.869 billion

  • July: $168.488 billion

  • August: $166.274 billion

  • September: $165.062 billion

  • October: $169.796 billion

Commercial and corporate lending by chartered banks to Canadian-based businesses is still down by about $22 billion since December 2008. But the news is the massive increase in October.

I’m trying to think about which M&A deals closed that month that could have accounted for the huge swing, but nothing sticks out. The BHP Billiton (BHP)/Potash (POT) deal involved a new billion of new loans, but that didn’t close. According to PWC, 13 deals were announced during Q3 worth more than $1 billion each; perhaps the answer’s there.

It seems unlikely that 940 net new $5 million commercial loans were advanced that month. Someone out there must know what drove the loan dollar volume. As exciting a move that it is, we’re still not back to where outstanding credit balances were in April 2010.

But still. $4.7 billion in a month. Yowza!

Source: Economic Revival? Canadian Commercial Lending Takes a Stunning Leap in October