Ottawa Weighs Bid to Secure Headquarters of Proposed Multinational Defence Bank
Canada is in the running to headquarter a new multinational bank dedicated specifically to financing defence projects, a sea change for a sector that has traditionally been shunned by the country’s financial institutions.
The Defence, Security and Resilience Bank, or DSRB, is a multilateral lending institution being established by a collective of countries that includes NATO members and their Indo-Pacific allies.
If it were headquartered in Canada, it would bring about 3,500 jobs in defence finance to the country, along with the advantage of being the global hub for meetings of member countries, according to Kevin Reed, the president of the bank’s development group.
“This is Canada’s time to lead in NATO and with our allies in defence finance. Canada has the leadership – we’re known for our finance prudence – and we have the support of a lot of other nations if we choose to take the lead,” he said while testifying before the federal government’s standing committee on industry and technology on Nov. 5.
The blueprint for the DSRB was laid out last year by Rob Murray, the chief executive officer of the bank’s development group. Mr. Murray is also the founding architect of NATO’s Defence Innovation Accelerator for the North Atlantic, as well as its Innovation Fund.
The DSRB, to be established by the end of 2026, will include as many as 40 member countries. Twelve will be anchor countries, tasked with ratifying and governing the bank’s founding charter and choosing the location of its headquarters. Those 12 are currently being finalized, and industry members, as well as members of the bank’s development group, are lobbying Ottawa to throw its hat into the ring.
Finance Minister François-Philippe Champagne told The Globe he is open to discussions about the bank being headquartered in Canada and is keen to learn more about the cost, and opportunity, for the country.
Glenn Cowan, the founder and managing partner of defence-focused venture capital fund ONE9, says Canada missed out when it didn’t join the 24 NATO allies establishing the NATO Innovation Fund for defence, security and resilience. He sees this as a second chance.
“That was a huge missed opportunity. So the question I would pose rhetorically to anyone in the position to help decide this is, ‘Do you want to miss out on this again?’” he said.
Banks like this don’t come around too often. Most recently, the New Development Bank and Asian Infrastructure Bank were established in 2015 and 2016, respectively. Similar institutions such as the World Bank Group are set up to mobilize capital to address issues affecting multiple countries. In the case of the DSRB, that issue is an increasingly divided world in which countries all over the world are increasing their defence spending.