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National balance sheet accounts

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Third quarter 2009 (Previous release)

National net worth in the third quarter declined $75 billion to $5.9 trillion, largely reflecting an increase in Canada's net foreign debt. Household net worth rose again to reach $5.7 trillion in the third quarter, as equity markets rallied.

National net worth continues to weaken

National net worth (the sum of non-financial assets less net foreign debt) declined for the third consecutive quarter, with a cumulative decline of $140 billion (-2.3%) over this period. This followed several years of rising national net worth.

National net worth down again as net foreign debt advances

National net worth changes reflect continued declines in national saving and decreases in the value of non-financial assets. In the last two quarters, it has also largely reflected increases in net foreign debt, which are due in part to the revaluation effects of the exchange rate on foreign currency denominated-assets and liabilities. Exchange rate variations have a much larger impact on Canada's international assets than on international liabilities. In the third quarter, Canadian holdings of foreign equity benefited from large stock market gains, but these gains were dampened by exchange rate conversion losses on those same assets.

On a per capita basis, national net worth has fallen from $176,800 in the second quarter to $173,900 in the third quarter of 2009.

Household net worth advances again, but remains below last year's high

Household net worth was up $127 billion (+2.3%) to $5.7 trillion in the third quarter, as equity markets rallied. Increases in the value of household financial assets (including fixed income securities, corporate equities, mutual fund investments, and pension assets) contributed to the increase in household net worth.

Note to readers

The national balance sheet accounts are comprised of the balance sheets of all of the sectors of the economy: the persons and unincorporated business (households), corporate, government and non-resident sectors. They cover all national non-financial assets and financial claims and associated liabilities outstanding in all sectors.

National net worth is national wealth less net foreign liabilities (i.e., what is owed to non-residents less what non-residents owe to Canadians). Alternatively, it is the sum of the net worth of the persons and unincorporated business, corporate and government sectors.

Quarterly series, both book and market value, are available from the first quarter of 1990. Marketable securities are at market value, unless otherwise stated. For more information on the market value estimates, consult the Balance sheet estimates at market value page of our website.

With this release of the National Balance Sheet Accounts a number of sectors and categories that were previously published have been combined, in order to provide more relevant sector and category information.

Market value estimates on annual and quarterly basis have been expanded. Annual market value data are published for all sectors from 1970, while book value estimates remain available from 1961. Quarterly data are available for all sectors from the first quarter of 1990 for market and book value estimates. These estimates will facilitate international comparisons with other countries.

Canadian stock markets continued to recover in the third quarter, with the Standard and Poor's composite index up again (+10%), closing out the quarter at 11,400. This added to the gains in net worth recorded in the second quarter, following three consecutive quarterly declines beginning with the third quarter of 2008.

Household net worth up again

Household per capita net worth grew 1.8% during the third quarter of 2009 to $168,800, still below the $179,000 peak in the second quarter of 2008.

Household debt (in the form of mortgages and consumer credit) continued to increase in the third quarter. Falling mortgage rates, along with increased sales of existing homes and renovations, sustained increases in mortgage demand. In addition, strength in auto purchases led to a further increase in consumer credit.

The household debt-to-net worth ratio remained relatively unchanged. However, personal sector liabilities increased from $1.39 trillion to $1.41 trillion (+1.6%), driving up the household debt-to-income ratio 2 points to 145%.

Government net debt continues to advance

The net worth of the government sector declined $29 billion, as overall government net debt increased and the value of their non-financial assets declined.

The federal government's credit market debt increased by 5% in the third quarter, caused by increased borrowing. This was partly due to financing of special government initiatives (such as the insured mortgage purchase program and investment by government in private non-financial corporations). The borrowing was mainly in the form of federal bonds, with institutional investors the major buyers.

The credit market debt of other levels of government fell, mainly caused by the decline in the value of debt denominated in foreign currencies from the appreciation of the Canadian dollar in the third quarter.

Total government sector net debt (at book value) as a percentage of gross domestic product increased to 40.9%, from 39.5% in the previous quarter and from 35.5% in the same quarter of 2008. Nevertheless, it remained well below the 90% range reached in the mid-1990s.

Corporate net worth declines

Consistent with rising net worth in other sectors in the economy, corporate net worth declined. Corporate sector net worth decreased for a second consecutive quarter, down $172 billion to $239 billion.

The third quarter saw a significant return by non-financial corporations to equity financing. In addition, the overall credit market debt of non-financial private corporations fell again. As a result, the non-financial private corporations' credit market debt-to-equity ratio (at book value) decreased from 55.9% in the second quarter to 53.2% in the third quarter.

Institutional investors, such as trusteed pension plans and mutual funds, increased their overall investment in marketable securities, particularly government bonds, while reducing their holdings of short-term paper. However, these gains were moderated by losses on foreign currency-denominated assets.

Financial institutions recorded small increases in loan assets during the third quarter, especially for mortgages and consumer credit. However, the increase in consumer credit was less than the previous quarter.

Available on CANSIM: tables 378-0012 to 378-0014 and 378-0049 to 378-0116.

Definitions, data sources and methods: survey number 1806.

The third quarter 2009 National Balance Sheet Accounts: Data Tables, Vol. 2, no. 3 (13-022-X, free), is now available from the Key resource module of our website under Publications.

For more information, or to enquire about the concepts, methods or data quality of this release, contact the information officer (613-951-3640;, Income and Expenditure Accounts Division.

Table 1

National balance sheet accounts
  Second quarter 2008 Third quarter 2008 Fourth quarter 2008 First quarter 2009 Second quarter 2009 Third quarter 2009 Second quarter to third quarter 2009
  Market value, not seasonally adjusted
  $ billions change in $ billions
National net worth1 5,792 5,942 6,030 6,021 5,965 5,890 -75
  1.1 2.6 1.5 -0.1 -0.9 -1.3 ...
National wealth1 5,845 5,958 5,976 5,990 5,975 5,938 -37
  1.8 1.9 0.3 0.2 -0.3 -0.6  ...
Net foreign debt -53 -15 54 32 -10 -49 -39
National net worth, by sector              
Household sector 5,964 5,789 5,526 5,446 5,591 5,718 127
Corporate sector -185 153 528 612 411 239 -172
Government sector 13 0 -24 -36 -38 -67 -29
  $ change in dollars
National net worth per capita 173,800 177,600 179,900 179,100 176,800 173,900 -2,900
not applicable
The first line is the series itself expressed in billions of dollars. The second line is the period-to-period percentage change.