Toronto financial services could be P3 player: report

If your firm is part of Toronto’s financial services sector, policymakers might come knocking.

That’s because Toronto’s financial sector is being touted as a uniquely positioned player to foster public-private partnerships (P3s), which are needed to address the growing global infrastructure gap, finds a report from Toronto Financial Services Alliance (TFSA) in collaboration with KPMG in Canada.

(TFSA is a P3 between government, the financial services industry and academia.)

Read: Feds name new infrastructure bank board

The report ranks Toronto’s financial services sector behind only those of New York and London in its strength and ability to provide expertise and funding to deliver on large-scale capital projects.

“What separates Toronto from its international peers in P3 transactions is the broad-based participation of so many players in one place,” says Steve Beatty, chairman, Cities Center of Excellence, KPMG LLP, in a release. “This clustering of investors, investees, developers, advisors and service providers located in and around Toronto makes it a truly unique P3 marketplace.”

The report highlights that Toronto’s strength in P3 transactions is built on the expertise and resources that Toronto’s banks, life and health insurers, and infrastructure funds bring to the structuring of deals, lender oversight and asset management.

Filling the gap

The infrastructure gap is the result of underinvestment, aging assets and climbing infrastructure demands, says the release. Some analyses find the shortfall as high as $75 trillion globally.

Read: Tackling infrastructure investment, part one

The report points out that, collectively, Toronto’s financial institutions are already internationally renowned for enabling P3 projects that have resulted in economic, institutional and social benefits at local and national levels.

But for Toronto to remain a leader in the P3 space, the sector will have to innovate.

Says Beatty: “The sector will continue to evolve and be subject to changing economic and geopolitical pressures that will not only define the success of individual P3 projects but of the Toronto sector’s ability to deliver.”

Read the full TFSA and KMPG report.

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