Borrowing activity from Canadian corporations and governments declined in the second quarter, according to Statistics Canada.
The national statistical agency reported that net borrowing via debt securities totalled $27.2 billion in the second quarter, down from $89.0 billion in the previous quarter.
“The activity in the second quarter was led by the government sector and by non-financial corporations, and it mainly reflected debt refinancing operations,” it said.
Net debt issuance by the government sector totalled $15.7 billion in the quarter, StatCan said, as financing activity ($32.4 billion) was partly offset by retirements of short-term debt securities ($16.7 billion).
At the same time, non-financial corporations were net borrowers in the second quarter, “raising $14.2 billion on credit markets,” StatCan said. “Firms from the construction industry contributed the most to the net issuance activity, followed by those from the transportation and warehousing industry.”
Conversely, financial corporations repaid a net $2.7 billion worth of debt securities in the quarter, led by the banks.
In terms of equities, retirements exceeded new issuance activity for the 10th consecutive quarter, resulting in net retirements of $8.5 billion in the second quarter.
Equity retirements “were driven by merger and acquisition activities and, to a lesser extent, share buyback activities,” StatCan said.