Recent changes to the Canadian Secured Credit Facility (CSCF) may prompt usage
Mark E. McElheran and Philip J. Henderson
On September 17, 2009, the Business Development Bank of Canada (BDC) announced revised parameters to the $12 billion CSCF that was established earlier this year as part of the Government of Canada's Extraordinary Financing Framework. Uncommitted CSCF funds will be offered on a "first-come, first-served" basis until March 31, 2010 with the stated intent of providing continued support for participants in the auto and equipment financing sectors. Based on information from a price-discovery process that BDC undertook in August and on industry feedback, the facility is now being offered to participants at 150 basis points above Government of Canada funding costs. It is anticipated that the new pricing may result in renewed interest in the facility which to date has remained untapped.
