Canada has entered the competition to host a new international bank that would finance military projects for NATO countries and their allies, with multiple Canadian cities vying for the headquarters.
The Defence, Security and Resilience Bank would offer lower-cost loans for military infrastructure and equipment purchases. A host country decision is expected in late March, followed by a city announcement by year’s end.
Vancouver, Toronto, Montreal, Ottawa and Halifax are all seeking the headquarters, which would bring an estimated 3,500 jobs.
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British Columbia Premier David Eby backed Vancouver’s bid February 9, citing its location between European and Pacific Rim allies. “Without question Vancouver is the right choice and the strategic choice,” Eby said, according to CBC News.
Toronto is pitching its financial sector. Ottawa points to its status as capital and concentration of defence companies. Montreal and Halifax have also submitted bids.
Ottawa convened representatives from 12 other nations on January 30 to discuss the bank. Finance Minister François-Philippe Champagne said Canada would play a leading role in the negotiations, according to The Globe and Mail.
Canada’s six largest banks — Royal Bank of Canada, Toronto-Dominion Bank, Bank of Nova Scotia, Bank of Montreal, Canadian Imperial Bank of Commerce, and National Bank of Canada — have signed on as partner banks. More Canadian financial institutions have joined than from any other country.
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The bank aims to raise roughly $135 billion for military projects. Member countries would contribute upfront capital and provide backstop guarantees in a crisis, designed to secure a triple-A credit rating. Commercial banks would then lend to defence manufacturers at lower rates.
The bank would address financing problems in Canada’s defence sector. Reed testified before a federal committee that banks have historically refused to work with defence contractors.
The bank plan comes as NATO countries face pressure to spend 5% of GDP on defence by 2035. Prime Minister Mark Carney said in June that Canada would hit the earlier 2% target this year, then committed to reaching 5% by 2035.
Germany and Britain have refused to back the bank. Germany argues that defence financing should run through existing European Union mechanisms.
The bank is expected to launch by the end of 2026 with up to 40 member countries. Twelve anchor nations will ratify the charter and pick the headquarters location.
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