Calgary’s financial landscape
Calgary is Western Canada's financial centre and its financial services sector is a fast-growing one, a major contributor to the tax base and a source of high quality jobs.
An attractive market for firms in the financial services sector holds a concentration of capital-intensive companies, high deal velocity, large deal size, foreign investment and individual wealth.
Financial services in Calgary's industries
For Calgary, the energy sector represents an attractive market for firms in financial services. Alberta produces about 70 per cent of Canada’s crude oil and 80 per cent of its natural gas, while close to 80 per cent of total industry spending takes place in Alberta. The Western Canadian Sedimentary Basin (WCSB) has reserves of five billion barrels of conventional oil and 60 trillion cubic feet of natural gas. The province also has the world’s largest recoverable oil sands deposits.
The capital needed to finance the energy sector, and the revenue it generates cannot be overstated – no other sector in Canada requires the capital infusion that the energy sector does. For every $1 invested in the energy sector, there is a $3 return on investment.
Outside of revenue generation, the WCSB is also known as a trading basin. The velocity of deal flow, where approximately 8 per cent of all assets are traded (compared to a 1-2 per cent average in other jurisdictions), means companies operating in Calgary’s financial services sector are used to dealing with the large volume of transactions. As a result of this deal velocity, there is a certain sophistication and knowledge that operates within the sector.
Calgary is also seeing increased diversification of industries supported by the financial services sector, with agriculture and information and communications technology (ICT) receiving increased support from financial services organizations.
Thanks to high capital spending and the velocity of deal flow, Calgary is being recognized as more than just Canada’s energy capital. It is also becoming a financial services centre, where local companies are at the forefront of financing and developing global natural resources, and foreign financial institutions are establishing their presence in the city. In addition to their corporate activities, many of these international banks also have a retails side in order to serve Calgary's diverse population.
Examples of foreign financial institutions operating in Calgary
• Bank of China
• Barclays Capital
• Deutsche Bank
• Fidelity Investments
• Franklin Templeton (Bissett)
• Goldman Sachs
• ICICI Bank
• Merrill Lynch
• Morgan Stanley
• Royal Bank of Scotland
• Société Générale
Calgary is one of the wealthiest communities in Canada, which is beneficial to the financial services retail market. In 2012, Calgary boasted the highest personal income per capita in Canada at $58,314, and represents the second-highest average annual growth over the past 10 years (2003-2012) at 4.6 per cent.
Personal income per capita - 2012 (Canadian CMAs)
Source: Conference Board of Canada
Calgary also boasts the highest number of millionaires (persons reporting income of $1 million or over) in Canada among Canada's major cities, on a per capita basis, at 154.5 per 100,000 population in 2011.
Another way to measure wealth comes from the buying power of individuals. Among Canada's major cities, Calgary boasts the highest total change in retail sales growth over the past 10 years (2003-2012) at 77.2 per cent, and in 2012 had the highest retail sales per capita at $18,990. In addition, Calgary has the second highest total growth and average annual growth in retail sales per capita over the past 10 years (2003-2012) at 38.9 per cent and 3.7 per cent respectively.