Quarterly Financial Report September 30, 2020 (EDC Investments)

Summary

• EDC had net income of $348 million in the third quarter of 2020, compared with a net loss of $119 million a year earlier.p.6
• The net loss for the first nine months of 2020 was $2.0 billion, mainly due to loan provisioning and claims-related expenses; the provision for credit losses was $2.4 billion, up from $192 million.p.7
• Total business facilitated was $74,279 million in the nine months, versus $73,284 million in the same period of 2019 (in millions of Canadian dollars).p.5
• BCAP support in the first nine months of 2020 totalled $4.7 billion, mainly in direct lending, of which 50% was in the aerospace sector.p.5
• The allowance for credit losses in the loans portfolio increased 225% to $3.3 billion, while Canadian GDP fell 39% at an annual rate in the second quarter.p.4

Key insights

1. Between the last half of March and September 30, $1.1 billion was drawn on revolving facilities.p.4
2. Financing and investments business facilitated decreased by 16%, with direct lending down 30% and loan guarantees up 64%.p.5
3. Business facilitated for international trade guarantees increased by 45% and for financial institutions insurance by 43%.p.5
4. Net loan disbursements of $3.6 billion drove gross loans receivable up, partly offset by a $2.1 billion increase in the allowance for losses on loans.p.8
5. The limit on contingent liability arrangements was increased from $45.0 billion to $90.0 billion, and EDC's position against it is $32.4 billion.p.19
6. Claims-related expenses were $278 million higher than in the same period of 2019.p.7