A subsidiary of First West Credit Union said the demand for its specialized subordinated debt financing services is growing.

“The economic uncertainty over the last few years caused some business people to put important purchasing decisions on hold," said Rob Napoli vice president at First West Capital, a division of the $6.3 billion First West Credit Union in British Columbia. "However, there has recently been a change in attitudes toward business acquisitions."

Formed in 2010, First West Capital has a $60 million fund established to provide subordinated debt and mezzanine financing to small- and medium-sized businesses. So far, six deals totaling nearly $6.5 million have been approved or funded.

Subordinated debt is used as a financing method for growing businesses that have proven cash flows but cannot qualify for sufficient conventional business loans, according to the subsidiary.

To date, the First West Capital deals have been mainly focused on change of ownership transactions such as family succession, management buy-outs or deals between partners, according to the subsidiary.

Napoli said he expects this trend to continue, particularly in the small- and medium-sized businesses market where there is a higher prevalence of family ownership and owner-operated businesses.

Napoli said while First West Capital is carefully watching developments in Europe and the U.S. and their potential effect on the British Columbia market, the activity the division has seen reflects a shift in confidence in seizing opportunities for business growth.