Bank of Canada advances to federal and provincial governments

There is much contention surrounding the history of the Bank of Canada making advances to the federal government and provinces.  Some claim it never happened, that although there were provisions in the Bank of Canada Act (article 18 (i) and (j)) for advances, this provision was never used.  That is incorrect, it was indeed used, multiple times.  The reason it took so long to confirm this is because the information was not on the Stats Canada tables of the Bank of Canada balance sheet (which does not go earlier than 1953), it was buried in the Canada Gazette archives.  Below is a chart of every time the BoC made advances to governments, the last being in 1961.  As you will see, the BoC had no issue giving its biggest advance for the war effort.

Date Level of government Amount 2017 dollars Per Capita
April 1935 Federal $3,000,000 $54,000,000 $4.98
June 1935 Federal $4,301,562 $77,965,811.25 $7.19
July 1935 Federal $1,240,625 $22,486,328.13 $2.07
Aug 1935 Federal $1,246,563 $22,593,954.38 $2.08
Sept 1935 Federal $2,759,375 $50,013,671.88 $4.61
Oct 1935 Federal $15,724,750 $285,011,093.75 $26.28
Nov 1935 Federal $2,223,375 $40,298,671.88 $3.72
Dec 1935 Federal $3,465,812 $62,817,842.50 $5.79
Jan 1936 Federal $2,195,875 $38,724,552.36 $3.54
April 1936 Provincial $2,000,000 $35,270,000 $3.22
May 1936-Sept 1936 Provincial $3,000,000 $52,910,000 $4.83
Oct 1936 Provincial $1,000,000 $17,640,000 $1.61
April 1938 Federal $7,000,000 $117,120,000 $10.50
Sept 1940 Federal $32,000,000 $522,000,000 $45.86
Jan 1953 Federal $15,000,000 $138,830,000 $9.35
Nov 1961 Federal $9,000,000 $74,810,000 $4.10

If you’d like to see the balance sheets from the Canada Gazette for yourself, check them out here:

BoC balance sheet 1935-1952


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    • Understandingcanada · 8 Days Ago

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