News Release Archive

Nova Scotia businesses can now tap into a new source of
financing, thanks to a $10 million program set up by the Economic
Renewal Agency and the Royal Bank of Canada.

The Royal Bank/Nova Scotia Financing Program for Innovative Small
Business was launched at InNOVAcorp in Dartmouth today by
Economic Renewal Minister Richie Mann and Ian MacFadden, vice
president, Business Banking, Royal Bank of Canada.

"Innovative firms need increased access to higher risk financing.
That's because their assets are less tangible than the bricks and
mortar that lenders traditionally turn to for collateral. This
new loan program will make it easier for these knowledge-based
companies to secure that financing. Ultimately that means more
exports and more jobs for Nova Scotians," Mr. Mann said.

"This $10 million program is part of the $300 million commitment
to growth and export-oriented businesses made last year by Royal
Bank. It's the kind of program small business owners tell us they
need to finance growth and create new jobs," Mr. MacFadden said.

"As the leading lender to small businesses in Canada, we
currently have $1 billion in loans to small and medium-sized
businesses in Atlantic Canada. This new program complements our
existing range of specialized financing products for
knowledge-based industries," said Mr. MacFadden.

The Royal Bank will make up to $10 million available in loan
capital to companies in sectors such as information technology,
telecommunications, biotechnology and aquaculture.

In turn, the Economic Renewal Agency will contribute up to $2
million to establish a loan loss reserve fund, thereby assuming
20 per cent risk of the total investment.

Eligible businesses can borrow from $50,000 to $500,000 over a
three year period. The loans can be used for research and
development, market development and/or new production and service
capacity improvements. Funding for seed capital, pure research
and restructures is not eligible.

"The agency's Business Development Corporation (BDC) has been one
of few sources for this type of financing in the province. With
this new partnership, businesses will have more options for
financing and the province's risk is reduced from 100 per cent to
20 per cent. We hope it will encourage the creation of similar
programs," said Mr. Mann.

BDC board member and entrepreneur Leonard Sarsfield is well aware
of the need for such a program. Sarsfield said he was fortunate
to get financing when he started Sarsfield Foods from scratch 15
years ago. The company he sold six years ago now makes 100,000
apple pies a day and employs close to 200 employees.

"Today, it's difficult for small businesses to get financing
without some type of support. That's why partnerships like this
are so important," Mr. Sarsfield said.

In addition to the $2 million investment, the province will work
with InNOVAcorp to pre-screen applications and to help companies
enhance their prospects for securing loan capital.

"We are excited about the Royal Bank and the province's
commitment to develop Nova Scotian technology companies.
Partnerships like this, that provide access to solid financing,
are critical to our ability to help grow Nova Scotia's economy,"
said Dr. Ross McCurdy, chief executive officer of InNOVAcorp.

"Public-private partnerships are a fundamental part of doing
business at InNOVAcorp. We look forward to assessing the
technology-based companies that are brought forward through this
initiative," Dr. McCurdy said.

This new Royal Bank/Nova Scotia Financing Program for Innovative
Small Business complements similar programs set up by the
province to help Nova Scotia businesses, including the agency's
Community Business Loan Program.


Contact: Angela Poirier       902-424-3900

         Elizabeth MacDonald  902-421-8121
         Royal Bank of Canada

trp                    Mar. 10, 1997 - 12 p.m.