A federal bank awarded senior staff $104 million in pandemic bonuses and pay raises, even as it reported a net loss and customers struggled with “extreme hardship,” records show. Access To Information figures obtained by the Canadian Taxpayers Federation (CTF) tracked COVID-19 perks paid by the Business Development Bank..“The federal Crown corporation should not have doled out big bonuses and higher pay while Canadians were losing their businesses,” Franco Terrazzano, federal director of the CTF, said in a statement. The rewards were paid to staff in 2020 and 2021, according to accounts..Bonuses totaled $93 million over two years, the equivalent of an average $20,040 per staffer that received a payment. Pay raises were $11 million..The Bank at the time lamented hardships facing small businesses in Canada. “They struggled,” then-CEO Michael Denham wrote in the Bank’s 2021 Annual Report. “The COVID-19 pandemic caused extreme hardship for business owners in every part of the country.”.The bonuses and raises were approved even as the Bank reported a net loss of $218 million in 2020. The collapse in revenues “was largely due to higher provision on expected credit losses and fair value depreciation as a result of current economic uncertainties,” the Bank earlier reported to Parliament..“We take more risks than other financial institutions and when the economy slows we step in,” Pierre Cléroux, vice-president, testified last April 26 at the Commons industry committee..“During the pandemic we provided $2.8 billion in direct financial support and over $4.5 billion indirectly in collaboration with financial institutions across Canada,” testified Cléroux. The Bank guaranteed loans to 4,927 businesses during the pandemic, according to a report to the Commons finance committee..Loans were approved through a Highly Affected Sectors Credit Availability Program launched by cabinet on Feb. 1, 2021. “Hard-hit companies” that already qualified for wage and rent subsidies were eligible for 100% loan guarantees if they could demonstrate 50% revenue losses in three of the previous eight months..Finance Minister Chrystia Freeland (University-Rosedale, ON) earlier told reporters the loan guarantees were intended to aid the most hard-pressed employers “weather this storm and be ready for a robust recovery” after the pandemic ran its course. “Canada is offering the most extensive set of support measures for small businesses of any G7 country,” Freeland told the finance committee at the time..Records showed loans up to $6.25 million were available for larger businesses like hotel and restaurant chains. The program waived interest payments for a year. Repayment of four percent loans was not due for ten years.
A federal bank awarded senior staff $104 million in pandemic bonuses and pay raises, even as it reported a net loss and customers struggled with “extreme hardship,” records show. Access To Information figures obtained by the Canadian Taxpayers Federation (CTF) tracked COVID-19 perks paid by the Business Development Bank..“The federal Crown corporation should not have doled out big bonuses and higher pay while Canadians were losing their businesses,” Franco Terrazzano, federal director of the CTF, said in a statement. The rewards were paid to staff in 2020 and 2021, according to accounts..Bonuses totaled $93 million over two years, the equivalent of an average $20,040 per staffer that received a payment. Pay raises were $11 million..The Bank at the time lamented hardships facing small businesses in Canada. “They struggled,” then-CEO Michael Denham wrote in the Bank’s 2021 Annual Report. “The COVID-19 pandemic caused extreme hardship for business owners in every part of the country.”.The bonuses and raises were approved even as the Bank reported a net loss of $218 million in 2020. The collapse in revenues “was largely due to higher provision on expected credit losses and fair value depreciation as a result of current economic uncertainties,” the Bank earlier reported to Parliament..“We take more risks than other financial institutions and when the economy slows we step in,” Pierre Cléroux, vice-president, testified last April 26 at the Commons industry committee..“During the pandemic we provided $2.8 billion in direct financial support and over $4.5 billion indirectly in collaboration with financial institutions across Canada,” testified Cléroux. The Bank guaranteed loans to 4,927 businesses during the pandemic, according to a report to the Commons finance committee..Loans were approved through a Highly Affected Sectors Credit Availability Program launched by cabinet on Feb. 1, 2021. “Hard-hit companies” that already qualified for wage and rent subsidies were eligible for 100% loan guarantees if they could demonstrate 50% revenue losses in three of the previous eight months..Finance Minister Chrystia Freeland (University-Rosedale, ON) earlier told reporters the loan guarantees were intended to aid the most hard-pressed employers “weather this storm and be ready for a robust recovery” after the pandemic ran its course. “Canada is offering the most extensive set of support measures for small businesses of any G7 country,” Freeland told the finance committee at the time..Records showed loans up to $6.25 million were available for larger businesses like hotel and restaurant chains. The program waived interest payments for a year. Repayment of four percent loans was not due for ten years.
