Canadian corporations earned record high operating profits of $231.7 billion in 2006, led by solid growth in the wholesale, retail, construction and banking industries, Statistics Canada reported today.

In the fourth quarter, profit growth continued with a 1.5% increase, following a 3.5% gain in the third quarter.

Overall, operating profits increased 7.3% in 2006, down from double-digit growth in the previous two years.

Despite the more modest increase, fourth quarter operating profits of $59.7 billion were at record high levels. Profits had previously shown a slight decline over the first two quarters of 2006.

Fourth quarter oil and gas profits weakened, as crude oil prices fell back from their early summer peak. In the manufacturing sector, higher profits of motor vehicle and parts manufacturers were offset by price-led declines in the petroleum refining industry.

In the financial sector, the depository credit intermediaries (mainly banks) were the biggest winners for the fourth quarter, while insurance companies reported little overall change in profits.

Overall, Depository credit intermediaries saw their profits rising 14.3% to $26.4 billion in 2006. Profits were boosted by higher net interest income stemming from growth in mortgage and non-mortgage loans such as credit cards and consumer and corporate loans. Profits also benefited from trading gains derived from equity markets, higher volumes in treasury and investment banking as well as wealth management.

Insurance carriers earned $13.9 billion of operating profits in 2006, up 8.2% over 2005 levels. Both life insurers, up 5.9% and property and casualty insurers, up 11.3%, contributed to the profit gains.

Non-depository credit intermediaries’ profits rose 9.5% to $7.5 billion.