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<SEC-DOCUMENT>0000016859-03-000077.txt : 20030829
<SEC-HEADER>0000016859-03-000077.hdr.sgml : 20030829
<ACCEPTANCE-DATETIME>20030829140124
ACCESSION NUMBER:		0000016859-03-000077
CONFORMED SUBMISSION TYPE:	6-K
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20030630
FILED AS OF DATE:		20030829

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			MFC BANCORP LTD
		CENTRAL INDEX KEY:			0000016859
		STANDARD INDUSTRIAL CLASSIFICATION:	SECURITY BROKERS, DEALERS & FLOTATION COMPANIES [6211]
		IRS NUMBER:				131818111
		STATE OF INCORPORATION:			B0
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		6-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-04192
		FILM NUMBER:		03873639

	BUSINESS ADDRESS:	
		STREET 1:		FLOOR 21, MILLENIUM TOWER
		STREET 2:		HANDELSKAI 94-96
		CITY:			A-1200 VIENNA
		STATE:			C4
		BUSINESS PHONE:		43 1 240 25 300

	MAIL ADDRESS:	
		STREET 1:		FLOOR 21, MILLENIUM TOWER
		STREET 2:		HANDELSKAI 94-96
		CITY:			A-1200 VIENNA
		STATE:			C4

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	ARBATAX INTERNATIONAL INC
		DATE OF NAME CHANGE:	19960603

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	NALCAP HOLDINGS INC
		DATE OF NAME CHANGE:	19950725

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	JAVELIN INTERNATIONAL LTD
		DATE OF NAME CHANGE:	19871118
</SEC-HEADER>
<DOCUMENT>
<TYPE>6-K
<SEQUENCE>1
<FILENAME>doc1.txt
<TEXT>

===============================================================================


                    U.S. SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON D.C. 20549


                                    FORM 6-K


                        REPORT OF FOREIGN PRIVATE ISSUER
                      PURSUANT TO RULE 13a-16 OR 15d-16 OF
                      THE SECURITIES EXCHANGE ACT OF 1934


                          For the Month of AUGUST 2003


                                MFC BANCORP LTD.
             (Exact Name of Registrant as specified in its charter)


      FLOOR 21, MILLENNIUM TOWER, HANDELSKAI 94-96, A-1200, VIENNA, AUSTRIA
                              011 (43) 1 24025 102
              (Address and telephone number of Registrant's office)

Indicate  by check mark whether the Registrant files or will file annual reports
under  cover  of  Form  20-F  or  Form  40-F.

                      [X]  Form 20-F          [ ]  Form 40-F


Indicate  by check mark if the Registrant is submitting the Form 6-K in paper as
permitted  by  Regulation  S-T  Rule  101(b)(1):
                                                ------

Indicate  by check mark if the Registrant is submitting the Form 6-K in paper as
permitted  by  Regulation  S-T  Rule  101(b)(7):
                                                ------

Indicate  by  check mark whether by furnishing the information contained in this
Form,  the  Registrant  is  also  thereby  furnishing  the  information  to  the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

                            Yes              No   X
                                -----           -----

If "Yes" is marked, indicate below the file number assigned to the Registrant in
connection  with  Rule  12g3-2(b):  82-                   .
                                        ------------------

===============================================================================

<PAGE>

                                [GRAPHIC OMITED]



                                MFC BANCORP LTD.



                           2003 SECOND QUARTER REPORT
                                 TO SHAREHOLDERS


                                  JUNE 30, 2003


                           FORWARD-LOOKING STATEMENTS


The  statements in this report that are not based on historical facts are called
"forward-looking  statements"  within  the  meaning of the United States Private
Securities Litigation Reform Act of 1995. These statements appear in a number of
different  places  in  this  report  and  can  be  identified  by  words such as
"estimates",  "projects",  "expects",  "intends",  "believes", "plans", or their
negatives or other comparable words.  Also look for discussions of strategy that
involve  risks and uncertainties.  Forward-looking statements include statements
regarding  the  outlook for our future operations, forecasts of future costs and
expenditures, evaluation of market conditions, the outcome of legal proceedings,
the  adequacy  of  reserves, or other business plans. You are cautioned that any
such  forward-looking  statements  are  not guarantees and may involve risks and
uncertainties.  Our  actual  results  may  differ  materially  from those in the
forward-looking  statements  due  to  risks  facing  us  or  due to actual facts
differing  from the assumptions underlying our predictions.  Some of these risks
and  assumptions are set out in reports and other documents that we file with or
furnish  to  the  U.S.  Securities and Exchange Commission from time to time and
include:

   *  general  economic  and  business conditions, including changes in interest
      rates;
   *  prices  and  other  economic  conditions;
   *  natural  phenomena;
   *  actions  by  government  authorities,  including  changes  in  government
      regulation;
   *  uncertainties  associated  with  legal  proceedings;
   *  technological  development;
   *  future  decisions  by  management  in  response  to  changing  conditions;
   *  our  ability  to  execute  prospective  business  plans;  and
   *  misjudgments  in  the  course  of  preparing  forward-looking  statements.

We  advise you that these cautionary remarks expressly qualify in their entirety
all  forward-looking  statements  attributable  to  us  or persons acting on our
behalf.  Unless  required  by  law,  we  do  not assume any obligation to update
forward-looking  statements  based  on  unanticipated  events  or  changes  in
expectations.  However,  you  should  carefully  review  the  reports  and other
documents  that  we  file  with  or  furnish to the U.S. Securities and Exchange
Commission  from  time  to  time.

<PAGE>

                                MFC BANCORP LTD.

                           2003 SECOND QUARTER REPORT

President's  Letter  to  Shareholders:

We  are  pleased  to  enclose  our  results for the second quarter of 2003.  Our
revenues  in  the second quarter of 2003 increased by approximately 83% compared
to  the  same  period  in  2002,  primarily  as  a result of the increase in and
integration  of trading activities into our operations.  In the current quarter,
the  Euro  and  the  Swiss  franc  appreciated  by  approximately  11%  and  7%,
respectively,  versus  the  Canadian  dollar, and the U.S. dollar depreciated by
approximately  10% versus the Canadian dollar, compared to the second quarter of
2002, which affected our results in the current period. The following table is a
summary  of  selected  financial  information  concerning  MFC  for  the periods
indicated:

<TABLE>
<CAPTION>

                                      Three Months Ended              Three Months Ended
                                           June 30,                        June 30,
                                  --------------------------      ------------------------------
                                    2003              2002           2003               2002
                                  --------          --------      ----------        ------------
                                  (U.S. dollars in thousands      (Canadian dollars in thousands
                                   except per share amounts)         except per share amounts)
                                        Information Only
<S>                               <C>               <C>           <C>               <C>
Revenue                           $ 71,938          $ 35,138      $ 97,496          $ 53,364
Net income                           7,472             6,617        10,125            10,049
Net income per share:
 Basic                                0.58              0.50          0.78              0.76
 Diluted                              0.55              0.48          0.75              0.72

                                  June 30,       December 31,       June 30,        December 31,
                                    2003              2002           2003               2002
                                  --------       ------------     ----------        ------------
                                   (U.S. dollars in thousands)    (Canadian dollars in thousands)
                                         Information Only

Cash and cash equivalents         $ 57,477          $ 64,835      $ 77,898          $102,413
Securities                          40,993            39,661        55,558            62,649
Total assets                       316,578           282,712       429,057           446,574
Debt                                60,655            43,554        82,206            68,798

</TABLE>

Net  income  for the three-month period ended June 30, 2003 was $10.1 million or
$0.75 per share on a diluted basis, compared to $10.0 million or $0.72 per share
on  a  diluted  basis  in  the  prior  year.

We are an international merchant banking company. Merchant banking encompasses a
broad  spectrum  of activities related to the integrated combination of banking,
trading,  financing  commercial  trade  and  proprietary  investing.

Our  merchant  banking  activities  provide  specialized  banking  and corporate
finance  services  and  advise  clients  on  corporate  strategy  and structure,
including  mergers  and  acquisitions  and  capital  raising.  They also include
proprietary  trading  in  commodities  and  natural  resources  and  proprietary

                                        2

<PAGE>

investing  of  our  own  capital  in enterprises to realize long-term or trading
gains. Such investing is generally in businesses or assets whose intrinsic value
is  not  properly  reflected in their share or other price, often as a result of
financial  or  other  distress  affecting  them.  Such  proprietary investing is
generally  not passive and we seek investments where our financial expertise and
management  can  add  or unlock value. Proprietary investments are generated and
made  as  part  of our overall merchant banking activities and are realized upon
over  time.

We  have  established  a  firm foundation for our operations and look forward to
continued  growth  during  the  remainder  of  2003.


                                      Respectfully  submitted,

                                       [graphic omitted]

                                       M.J.  Smith
August  2003                           President

                                        3

<PAGE>

                                MFC BANCORP LTD.



                        CONSOLIDATED FINANCIAL STATEMENTS

                     FOR THE SIX MONTHS ENDED JUNE 30, 2003

                                   (UNAUDITED)



                                        4

<PAGE>

                                MFC BANCORP LTD.

                           CONSOLIDATED BALANCE SHEETS
                                   (UNAUDITED)
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>

                                          JUNE 30, 2003       June 30,        December 31,
                                         ----------------       2003             2002
                                          (U.S. DOLLARS)    ------------    ---------------
                                         INFORMATION ONLY         (CANADIAN DOLLARS)
<S>                                      <C>              <C>             <C>
ASSETS
Cash and cash equivalents                $       57,477     $    77,898     $  102,413
Securities                                       40,993          55,558         62,649
Loans                                            60,373          81,824         77,879
Receivables                                      52,520          71,180         53,955
Commodity investments                            13,409          18,174         13,172
Properties held for sale                         46,144          62,539         72,959
Resource property                                26,855          36,396         36,747
Goodwill                                         11,661          15,804         16,412
Equity method investments                         5,842           7,917          7,917
Prepaid and other                                 1,304           1,767          2,471
                                         --------------     -----------     ----------
                                         $      316,578     $   429,057     $  446,574
                                         ==============     ===========     ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
 Accounts payable and accrued expenses   $       25,348     $    34,354     $   47,279
 Debt                                            60,655          82,206         68,798
 Future income tax liability                         76             103            258
 Deposits                                        25,198          34,151         39,198
                                         --------------     -----------    -----------
     Total liabilities                          111,277         150,814        155,533
                                         --------------     -----------    -----------

Minority Interests                                4,273           5,791          5,751

Shareholders' Equity
 Common stock                                    53,111          71,982         70,269
 Cumulative translation adjustment              (11,628)        (15,761)        18,733
 Retained earnings                              159,545         216,231        196,288
                                         --------------     -----------     ----------
                                                201,028         272,452        285,290
                                         --------------     -----------     ----------
                                         $      316,578     $   429,057     $  446,574
                                         ==============     ===========     ==========

</TABLE>

The accompanying notes are an integral part of these financial statements.

                                        5

<PAGE>

                                MFC BANCORP LTD.

           CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2003 AND 2002
                                   (UNAUDITED)
                (DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>

                                              JUNE 30,               June 30,
                                                2003           ---------------------
                                          ----------------       2003        2002
                                           (U.S. DOLLARS)      --------    ---------
                                          INFORMATION ONLY      (CANADIAN DOLLARS)
<S>                                       <C>                  <C>         <C>
Financial services revenue                $ 133,081            $ 180,364   $ 107,596

Expenses
 Financial services                         111,118              150,598      70,219
 General and administrative                   5,907                8,006      15,439
 Interest                                     1,347                1,826       3,421
                                          ---------            ---------   ---------
                                            118,372              160,430      89,079
                                          ---------            ---------   ---------

Income before income taxes                   14,709               19,934      18,517
Recovery of income taxes                         55                   75       1,510
                                          ---------            ---------   ---------
                                             14,764               20,009      20,027
Minority interests                              (49)                 (66)         10
                                          ---------            ---------   ---------
Net income                                   14,715               19,943      20,037
Retained earnings, beginning of period.     144,830              196,288     164,872
Dividends                                         -                    -     (19,339)
                                          ---------             --------   ---------
Retained earnings, end of period          $ 159,545             $216,231   $ 165,570
                                          =========             ========   =========

Earnings per share
 Basic                                    $    1.14             $   1.55   $    1.54
                                          =========             ========   =========
 Diluted                                  $    1.10             $   1.49   $    1.45
                                          =========             ========   =========

</TABLE>

The accompanying notes are an integral part of these financial statements.

                                        6

<PAGE>

                                MFC BANCORP LTD.

           CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
                FOR THE THREE MONTHS ENDED JUNE 30, 2003 AND 2002
                                   (UNAUDITED)
                (DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>

                                              JUNE 30,               June 30,
                                                2003           -----------------------
                                          ----------------       2003        2002
                                           (U.S. DOLLARS)      --------    -----------
                                          INFORMATION ONLY      (CANADIAN DOLLARS)

<S>                                       <C>                  <C>         <C>
Financial services revenue                $  71,938             $  97,496    $  53,364

Expenses
 Financial services                          60,941                82,593       35,976
 General and administrative                   2,749                 3,726        7,096
 Interest                                       730                   989        1,818
                                          ---------             ---------    ---------
                                             64,420                87,308       44,890
                                          ---------             ---------    ---------

Income before income taxes                    7,518                10,188        8,474
Recovery of income taxes                         21                    28        1,579
                                          ---------             ---------    ---------
                                              7,539                10,216       10,053

Minority interests                              (67)                  (91)          (4)
                                          ---------             ---------    ---------

Net income                                    7,472                10,125       10,049
Retained earnings, beginning of period      152,073               206,106      174,860
Dividends                                         -                     -      (19,339)
                                          ---------             ---------    ---------

Retained earnings, end of period          $ 159,545             $ 216,231    $ 165,570
                                          =========             =========    =========

Earnings per share
 Basic                                    $    0.58             $    0.78    $    0.76
                                          =========             =========    =========
 Diluted                                  $    0.55             $    0.75    $    0.72
                                          =========             =========    =========

</TABLE>

The accompanying notes are an integral part of these financial statements.

                                        7

<PAGE>

                                MFC BANCORP LTD.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                 FOR THE SIX MONTHS ENDED JUNE 30, 2003 AND 2002
                                   (UNAUDITED)
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>

                                                         JUNE 30,
                                                   ---------------------
                                                      2003       2002
                                                   ----------  ---------
<S>                                                <C>         <C>
Operating
 Net income                                        $  19,943   $ 20,037
 Adjustments to reconcile net income to net cash
     used in operating activities:
     Depreciation and amortization                       583        644
     Minority interests                                   66        (10)
     Gain on debt reduction                                -     (1,450)
     Exchange adjustments                            (10,508)      (388)
     Gain on sales of assets                          (5,402)         -
     Write-down of equity method investment                -      4,735
 Changes in current assets and liabilities
     Securities                                        5,807    (10,511)
     Receivables                                      (3,067)   (18,358)
     Commodity receivables                           (18,878)      (503)
     Due from investment dealers                           -        131
     Commodity investments                            (5,944)    (1,318)
     Properties held for sale                             46       (157)
     Accounts payable and accrued expenses           (10,469)    (6,760)
     Other                                            (2,829)    (1,327)
                                                   ---------   --------
                                                     (30,652)   (15,235)
Financing
 Net increase in deposits                                228     48,721
 Borrowings                                           22,668     13,689
 Debt repayments                                      (2,857)   (13,043)
 Issuance of shares, net of repurchases                1,713     (5,957)
                                                   ---------   --------
                                                      21,752     43,410
Investing
 Net (increase) decrease in loans                    (11,110)    (2,901)
 Purchases of long-term investments                     (275)         -
 Proceeds from sales of assets                         5,406          -
 Other                                                  (215)       (50)
                                                   ---------   --------
                                                      (6,194)    (2,951)

Exchange rate effect on cash and cash equivalents     (9,421)     3,486
                                                   ---------   --------
Net change in cash                                   (24,515)    28,710
Cash, opening balance                                102,413     77,166
                                                   ---------   --------

Cash, ending balance                               $  77,898   $105,876
                                                   =========   ========

</TABLE>

The accompanying notes are an integral part of these financial statements.

                                        8

<PAGE>

                                MFC BANCORP LTD.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                FOR THE THREE MONTHS ENDED JUNE 30, 2003 AND 2002
                                   (UNAUDITED)
                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>

                                                         JUNE 30,
                                                   ---------------------
                                                      2003       2002
                                                   ----------  ---------
<S>                                                <C>         <C>
Operating
 Net income                                        $  10,125   $  10,049
 Adjustments to reconcile net income to net cash
     used in operating activities:
     Depreciation and amortization                       280         344
     Minority interests                                   83          15
     Exchange adjustments                             (5,993)       (297)
     Write-down of equity method investment                -       4,735
 Changes in current assets and liabilities
     Securities                                        9,340      (7,094)
     Receivables                                        (160)    (15,688)
     Commodity receivables                            (3,699)     (3,147)
     Due from investment dealers                           -         143
     Commodity investments                            (2,270)        112
     Properties held for sale                             57         (16)
     Accounts payable and accrued expenses           (12,029)      2,591
     Other                                            (2,575)     (1,859)
                                                   ---------   ---------
                                                      (6,841)    (10,112)
Financing
 Net increase (decrease) in deposits                  (2,227)     44,790
 Borrowings                                            9,604        (462)
 Debt repayments                                      (2,258)     (4,466)
 Issuance of shares, net of repurchases                1,713      (2,394)
                                                   ---------   ---------
                                                       6,832      37,468
Investing
 Net (increase) decrease in loans                    (13,159)      5,506
 Purchases of long-term investments                      (60)          -
 Proceeds from sales of assets                         5,406           -
 Other                                                   (63)        (36)
                                                   ---------   ---------
                                                      (7,876)      5,470

Exchange rate effect on cash and cash equivalents     (5,084)      3,986
                                                   ---------   ---------
Net change in cash                                   (12,969)     36,812
Cash, opening balance                                 90,867      69,064
                                                   ---------   ---------

Cash, ending balance                               $  77,898   $ 105,876
                                                   =========   =========

</TABLE>

The accompanying notes are an integral part of these financial statements.

                                        9

<PAGE>

                                MFC BANCORP LTD.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                  FOR THE SIX MONTH PERIOD ENDED JUNE 30, 2003
                                   (UNAUDITED)

NOTE  1.  BASIS  OF  PRESENTATION

The  consolidated  financial statements contained herein include the accounts of
MFC  Bancorp  Ltd.  and  its  subsidiaries  (the  "Company").

The  interim  period consolidated financial statements have been prepared by the
Company  in  accordance  with Canadian generally accepted accounting principles.
The  preparation  of  financial  data  is  based  on  accounting  principles and
practices  consistent  with  those  used  in  the preparation of the most recent
annual  financial  statements.  Certain  information  and  footnote  disclosure
normally  included  in  consolidated financial statements prepared in accordance
with  generally  accepted  accounting principles have been condensed or omitted.
These  interim  period  statements  should  be  read  together  with the audited
consolidated  financial  statements  and  the accompanying notes included in the
Company's latest annual report on Form 20-F.  In the opinion of the Company, its
unaudited  interim  consolidated  financial  statements  contain all adjustments
necessary  in  order  to  present a fair statement of the results of the interim
periods  presented.  The  results  for  the  periods presented herein may not be
indicative  of  the  results  for  the  entire  year.

Certain  reclassifications  have  been  made  to  the  prior  period  financial
statements  to  conform  to  the  current  period  presentation.

NOTE  2.  NATURE  OF  BUSINESS

The  Company  is in the financial services business and its principal activities
focus  on  merchant  banking.

NOTE  3.  EARNINGS  PER  SHARE

The  Company adopted the Canadian Institute of Chartered Accountants' Accounting
Handbook  Section  3500,  "Earnings  Per  Share".  Basic  earnings  per share is
computed  by  dividing  income  available to common shareholders by the weighted
average  number of common shares outstanding during the period.  The computation
of  diluted  earnings  per  share assumes the conversion, exercise or contingent
issuance  of  securities  only  when such conversion, exercise or issuance would
have a dilutive effect on earnings per share. The dilutive effect of convertible
securities  is  reflected  in  diluted  earnings per share by application of the
"if-converted"  method.  The  dilutive  effect  of  outstanding call options and
warrants  and  their  equivalents  is reflected in diluted earnings per share by
application of the treasury stock method.  The computation of earnings per share
under Canadian generally accepted accounting principles conforms in all material
respects  with  the  computation  under  U.S.  generally  accepted  accounting
principles.

                                       10

<PAGE>

The  weighted  average  number  of  shares  (in  thousands)  outstanding for the
purposes  of  calculating basic earnings per share was 12,880 and 13,027 for the
six months ended June 30, 2003 and 2002, respectively, and 12,928 and 13,189 for
the  three  months  ended  June  30,  2003 and 2002, respectively.  The weighted
average  number  of  shares  (in  thousands)  outstanding  for  the  purposes of
calculating  diluted earnings per share was 14,003 and 14,371 for the six months
ended  June 30, 2003 and 2002, respectively, and 14,060 and 14,506 for the three
months  ended  June  30,  2003  and  2002,  respectively.

NOTE  4.  REPORTING  CURRENCY

The  Company  reports  its  results in Canadian dollars.  Certain amounts herein
have also been reported in U.S. dollars for reference purposes. Amounts reported
in  U.S.  dollars  have  been translated from Canadian dollars at a rate of U.S.
$1.00 = Canadian $1.3553 as at June 30, 2003, being the period-end exchange rate
as  prescribed  by  Regulation  S-X  (the  accounting  regulation  of  the  U.S.
Securities  and  Exchange  Commission).

NOTE  5.  SUBSEQUENT  EVENTS

On  or about July 24, 2003, the Company, through its 80% owned subsidiary, Mazak
Ltd.  ("Mazak"),  acquired the alloys and pigments businesses and related assets
of Trident Alloys Ltd. ("Trident") of Warsall, England for an aggregate purchase
price of approximately GBP 2.9 million ($6.5 million), including the issuance of
GBP  0.5 million ($1.1 million) in loan notes.  Such loan notes are due one year
from  closing and carry a warrant entitling the holder to convert the notes into
the  number  of  common shares which comprise 50% of the issued share capital of
Mazak  plus  one  share  upon  the  occurrence  of certain events, including the
failure  to  pay  the  loan  notes and events of insolvency.  In addition, Mazak
assumed  certain  liabilities  and obligations of Trident in connection with the
businesses  and  assets  acquired  (for  which  Trident  has agreed to indemnify
Mazak).  Mazak  also  acquired  certain  qualified  receivables in U.S. dollars,
Euros  and  Pounds  Sterling  relating  to  the  businesses and assets acquired,
aggregating  GBP 4.9 million ($11.0 million), by assuming certain obligations to
trade  creditors,  aggregating  GBP  1.7  million ($3.8 million), and paying the
balance  in  cash  upon  closing.

                                       11

<PAGE>

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

IN  THIS  DOCUMENT,  PLEASE  NOTE  THE  FOLLOWING:

*     REFERENCES  TO  "WE",  "OUR",  "US" OR "MFC" MEAN MFC BANCORP LTD. AND ITS
      SUBSIDIARIES,  UNLESS  THE  CONTEXT  OF THE SENTENCE CLEARLY SUGGESTS
      OTHERWISE;

*     ALL  REFERENCES  TO  MONETARY  AMOUNTS  ARE  IN  CANADIAN  DOLLARS, UNLESS
      OTHERWISE  INDICATED;

*     THE INFORMATION SET FORTH IN THIS QUARTERLY REPORT IS AS AT JUNE 30, 2003,
      UNLESS  AN  EARLIER  OR  LATER  DATE  IS  INDICATED;  AND

*     SELECTED  FINANCIAL  INFORMATION  HAS  BEEN  PROVIDED  IN U.S. DOLLARS FOR
      INFORMATIONAL  PURPOSES ONLY USING AN EXCHANGE RATE OF ONE CANADIAN DOLLAR
      BEING EQUAL  TO  U.S.  $0.7378,  BEING  THE  FEDERAL  RESERVE BANK OF NEW
      YORK RATE OF CONVERSION  FOR  CANADIAN  DOLLARS  TO  U.S.  DOLLARS  AS  AT
      JUNE  30,  2003.

The  following discussion and analysis of the financial condition and results of
our operations for the six months and three months ended June 30, 2003 should be
read in conjunction with the consolidated financial statements and related notes
included  in  this quarterly report, as well as our most recent annual report on
Form 20-F for the fiscal year ended December 31, 2002. Certain reclassifications
have  been  made  to  our  prior  period  financial statements to conform to the
current  period  presentation.

RESULTS  OF  OPERATIONS

OPERATING  RESULTS

We are a highly integrated international financial services company that focuses
on  merchant  banking.  We  provide  specialized  banking  and corporate finance
services  internationally.  These activities are primarily conducted through our
wholly-owned  banking  subsidiary.  Our  merchant  banking  activities include a
European  trading group focused on trading commodities and natural resources. We
also  commit  our  own capital to promising enterprises and invest and otherwise
trade to capture investment opportunities for our own account. We seek to invest
in businesses or assets whose intrinsic value is not properly reflected in their
share  price  or  value.  Our  investing  is  generally  not  passive.  We  seek
investments  where  our  financial  expertise  and  management can add or unlock
value.

Our  results  of  operations  have  been and may continue to be affected by many
factors  of  a  global  nature,  including  economic  and market conditions, the
availability  of capital, the level and volatility of equity prices and interest
rates, currency values, commodity prices and other market indices, technological
changes,  the  availability  of credit, inflation and legislative and regulatory
developments.  Our  results  of  operations  may  also be materially affected by
competitive  factors.  Competition  includes  firms  traditionally  engaged  in
financial  services  such as banks, broker-dealers and investment dealers, along
with  other  sources  such  as  insurance  companies,  mutual fund groups, other
companies offering financial services in Europe and globally and other trade and
finance  companies.

                                       12

<PAGE>

Our  results of operations for any particular period may also be affected by our
realization  on  proprietary investments. These investments are made to maximize
total  return through long-term appreciation and recognized gains on divestment.
We  can  realize  on  our  proprietary  investments through a variety of methods
including  sales,  capital  restructuring  or  other  forms  of  divestment.

The  international  and integrated nature and focus of our business has resulted
in  a  relatively low net rate of income tax.  In the six and three months ended
June  30,  2003,  we  had  a  net  tax  recovery.

In  recent  years, the financial services industry has experienced consolidation
and  convergence  as  financial  institutions  involved  in  a broad spectrum of
services  have  merged  or  combined.  The  trend  to consolidate is expected to
continue and produce global financial institutions with much greater capital and
other  resources  than  we  have.  As  a  result of the economic and competitive
factors  discussed  above, our results of operations may vary significantly from
period  to  period.  We  intend  to manage our business for the long-term and to
mitigate  the  effects  of  such  factors  by  focusing  on our core operations.

SIX  MONTHS  ENDED  JUNE 30, 2003 COMPARED TO THE SIX MONTHS ENDED JUNE 30, 2002

In the six months ended June 30, 2003, our revenues increased by 67.6% to $180.4
million  from  $107.6 million in the comparable period of 2002, primarily due to
the  increase  in  and integration of trading activities into our operations and
the decrease in the value of the Canadian dollar versus the Euro and Swiss franc
during  the period.  Based upon the period average exchange rates in the current
period,  the  Euro  and  Swiss franc increased by approximately 13.5% and 11.8%,
respectively,  in  value  against  the  Canadian  dollar,  and  the  U.S. dollar
decreased  by  approximately 7.6% in value against the Canadian dollar, compared
to  the  period  average  exchange  rates  in  the  comparative  period of 2002.

In the six months ended June 30, 2003, expenses increased to $160.4 million from
$89.1  million  in  the  comparable  period  of  2002,  primarily as a result of
increased  revenues  resulting  from  the increase in and integration of trading
activities  into  our  operations  and  the appreciation of the Euro. In the six
months  ended  June  30,  2003,  financial services expenses increased to $150.6
million  from  $70.2  million  in  the  comparable  period  of 2002. General and
administrative  expenses  decreased to $8.0 million in the six months ended June
30,  2003  from $15.4 million in the comparable period of 2002, primarily due to
the deduction of a net exchange adjustment of approximately $8.5 million, mainly
as  a  result of the effect of the exchange rate between the Canadian dollar and
the  U.S. dollar as at June 30, 2003 on U.S. dollar denominated liabilities.  In
the  period  ended  June 30, 2003, we recognized $5.4 million from a proprietary
investment and received securities valued at $4.5 million in payment of fees for
services  provided.  In  the  comparative  period  of 2002, we recognized a $1.5
million  gain  on  indebtedness  of a subsidiary.  Interest expense decreased to
$1.8  million  in  the  six  months ended June 30, 2003 from $3.4 million in the
comparable  period  of  2002, primarily as a result of a decrease in outstanding
indebtedness  during  the  current  period.

In  the  six  months ended June 30, 2003, our net earnings were $19.9 million or
$1.55  per share on a basic basis ($1.49 per share on a diluted basis), compared
to  $20.0  million  or  $1.54  per  share on a basic basis ($1.45 per share on a
diluted  basis)  in  the  period  ended  June  30,  2002.

                                       13

<PAGE>

THREE  MONTHS  ENDED  JUNE  30, 2003 COMPARED TO THE THREE MONTHS ENDED JUNE 30,
2002

In  the  three  months  ended  June 30, 2003, our revenues increased by 82.7% to
$97.5 million from $53.4 million in the comparable period of 2002, primarily due
to the increase in and integration of our trading activities into our operations
and  the  decrease in the value of the Canadian dollar versus the Euro and Swiss
franc  during  the  period.  Based upon the period average exchange rates in the
second  quarter  of  2003,  the  Euro and Swiss franc increased by approximately
11.1% and 7.3%, respectively, in value against the Canadian dollar, and the U.S.
dollar  decreased  by  approximately 10.0% in value against the Canadian dollar,
compared  to  the  period  average exchange rates in the second quarter of 2002.

In  the  three  months  ended June 30, 2003, expenses increased to $87.3 million
from  $44.9  million  in the comparable period of 2002, primarily as a result of
increased  revenues  resulting  from  the increase in and integration of trading
activities  into our operations and the appreciation of the Euro. In the current
quarter,  financial  services  expenses  increased  to  $82.6 million from $36.0
million  in  the comparable quarter of 2002. General and administrative expenses
decreased  to  $3.7  million  in  the three months ended June 30, 2003 from $7.1
million  in  the  comparable period of 2002, primarily due to the deduction of a
net exchange  adjustment  of  approximately  $4.6 million, mainly as a result of
the effect of  the exchange rate between the Canadian dollar and the U.S. dollar
as  at  June  30,  2003  on  U.S.  dollar  denominated  liabilities.  In  the
current  quarter,  we  received  securities valued at $4.5 million in payment of
fees  for services  provided.  Interest  expense  decreased  to  $1.0 million in
the three months ended  June 30, 2003 from $1.8 million in the comparable period
of  2002,  primarily  as  a  result  of  a  decrease in outstanding indebtedness
during the current  quarter.

In the quarter ended June 30, 2003, our net earnings were $10.1 million or $0.78
per  share  on  a  basic basis ($0.75 per share on a diluted basis), compared to
$10.0  million or $0.76 per share on a basic basis ($0.72 per share on a diluted
basis)  in  the  quarter  ended  June  30,  2002.

LIQUIDITY  AND  CAPITAL  RESOURCES

The  following  table  is a summary of selected financial information concerning
MFC  for  the  periods  indicated:

<TABLE>
<CAPTION>

                                   U.S. DOLLARS                    CANADIAN DOLLARS
                            ----------------------------     ----------------------------
                            JUNE 30,        DECEMBER 31,     JUNE 30,        DECEMBER 31,
                              2003              2002           2003              2002
                            --------        ------------     --------        ------------
                                  (IN THOUSANDS)                    (IN THOUSANDS)
                                 INFORMATION ONLY
<S>                         <C>              <C>             <C>             <C>
Cash and cash equivalents   $ 57,477          $ 64,835       $ 77,898        $ 102,413
Securities                    40,993            39,661         55,558           62,649
Total assets                 316,578           282,712        429,057          446,574
Debt                          60,655            43,554         82,206           68,798

</TABLE>

We  maintain a high level of liquidity, with a substantial amount of assets held
in  cash  and  cash  equivalents,  marketable  securities  and  customer  loans
collateralized  by  marketable  securities.  The  liquid  nature of these assets
provides  us  with  flexibility  in  managing  our  business and financing. This

                                       14

<PAGE>

liquidity  is  used by us in client related services where we act as a financial
intermediary  for third parties and in our own proprietary investing activities.

At  June 30, 2003, our cash and cash equivalents were $77.9 million, compared to
$102.4  million  at  December  31, 2002.  At June 30, 2003, we had securities of
$55.6  million,  compared  to  $62.6  million  at  December  31,  2002.

As  part  of our merchant banking activities, we establish, utilize and maintain
various  kinds  of  credit  lines and facilities with other banks, insurers, and
trade  finance  providers.  Most  of  these  facilities  are  short-term.  These
facilities  are  primarily  used  for  structured  trade  financing,  accounts
receivable  financing  and letters of credit. Such facilities are drawn upon and
used  for  specific  trading transactions. These credit facilities are generally
secured  by  the  subject  matter  of  a  proposed  transaction,  being either a
receivable  or  the  underlying  commodity  or natural resource being traded. We
often  further  enhance  the  credit  of  such  facilities through credit and/or
performance  insurance  provided  by  governmental and/or private insurers. Such
trade  finance  insurance  is  often  layered  with  varying  limitations  and
exceptions.  The  amounts  drawn  under the credit facilities fluctuate with the
kind  and  level of commodities and natural resources trading transactions being
undertaken  by  us.  As  such  transactions  are settled, proceeds are generally
applied  to  first  settle  amounts  drawn  under  such  credit  facilities.

We  have  debt  maturities  of  $4.5  million  in the remainder of 2003 and $4.2
million  in 2004, excluding the credit lines and facilities used for commodities
and  natural  resources  trading.  We  expect such maturing debt to be satisfied
primarily  through  cash  on  hand  and  cash flow from operations. Much of such
maturing  debt  may  either  subsequently  be  made  re-available  to  us by the
applicable  financial institution or we may replace such facilities with similar
facilities  depending  upon  our  trading  and  capital  requirements.

OPERATING  ACTIVITIES

Operating activities used cash of $30.7 million in the six months ended June 30,
2003,  compared  to  $15.2 million in the six months ended June 30, 2002. In the
six  months  ended  June  30,  2003, changes in securities provided cash of $5.8
million,  compared  to  using cash of $10.5 million in the six months ended June
30, 2002. An increase in receivables used cash of $3.1 million in the six months
ended  June 30, 2003, compared to $18.4 million in the six months ended June 30,
2002. An increase in commodity receivables used cash of $18.9 million in the six
months  ended  June  30,  2003, compared to $0.5 million in the six months ended
June  30, 2002, resulting primarily from increased activities in our operations.
An increase in commodity investments used cash of $5.9 million in the six months
ended  June  30, 2003, compared to $1.3 million in the six months ended June 30,
2002,  resulting  primarily  from the increase in our operations.  A decrease in
accounts  payable  and  accrued  expenses  used cash of $10.5 million in the six
months  ended  June  30,  2003, compared to $6.8 million in the six months ended
June  30,  2002.  We  expect to generate sufficient cash flow from operations to
meet  our  working  capital  and  other  requirements.

                                       15

<PAGE>

INVESTING  ACTIVITIES

Investing  activities used cash of $6.2 million in the six months ended June 30,
2003, compared to $3.0 million in the six months ended June 30, 2002. In the six
months  ended June 30, 2003, a net increase in loans used cash of $11.1 million,
compared  to  $2.9  million in the six months ended June 30, 2002. Proceeds from
sales  of  assets provided cash of $5.4 million in the six months ended June 30,
2003.

FINANCING  ACTIVITIES

Net  cash  provided  by financing activities was $21.8 million in the six months
ended  June 30, 2003, compared to $43.4 million in the six months ended June 30,
2002. Net borrowings provided cash of $19.8 million in the six months ended June
30, 2003, compared to $0.6 million in the six months ended June 30, 2002. In the
six months ended June 30, 2003, a net increase in deposits provided cash of $0.2
million,  compared  to  $48.7 million in the six months ended June 30, 2002. The
issuance of common shares in the six months ended June 30, 2003 provided cash of
$1.7 million, compared to the net repurchase of common shares using cash of $6.0
million  in  the  six  months  ended  June  30,  2002.

We had no material commitments to acquire assets or operating businesses at June
30,  2003.  We  anticipate  that  there  will  be  acquisitions of businesses or
commitments  to  projects  in  the  future.  To  achieve  our long-term goals of
expanding  our  assets  and  earnings,  including  through acquisitions, we will
require substantial capital resources. The necessary resources will be generated
from  cash  flow  from  operations,  cash on hand, borrowing against our assets,
sales  of  proprietary  investments  or  the  issuance  of  securities.

FOREIGN  CURRENCY

Substantially  all  of our operations are conducted in international markets and
our consolidated financial results are subject to foreign currency exchange rate
fluctuations.

A  substantial  amount  of  our revenues are received in Euros, U.S. dollars and
Swiss  francs.  In  addition,  certain assets and liabilities are denominated in
these  currencies. Accordingly, our results of operations and financial position
for  any  given  period, when reported in Canadian dollars, can be significantly
affected  by the fluctuation of exchange rates for Euros, U.S. dollars and Swiss
francs  prevailing  during  a  period.

In  general,  each  asset,  liability,  revenue  or  expense  resulting  from  a
transaction  denominated  in  a  foreign  currency  is translated into the local
functional  currency at the exchange rate in effect at the transaction date, and
monetary  items  denominated  in  a foreign currency are adjusted to reflect the
exchange rate in effect at the balance sheet date. An exchange gain or loss that
arises  as  a  result  of  the  translation  or settlement of a foreign currency
denominated  monetary  item  is included in general and administrative expenses.
Based  upon  the  period average exchange rates in the six months ended June 30,
2003,  the  Canadian  dollar decreased in value by approximately 10.6% and 11.9%
against  each  of  the  Swiss franc and the Euro, respectively, and increased in
value  by  approximately  8.3%  against  the U.S. dollar, compared to the period
average  exchange  rates in the comparative period of

                                       16

<PAGE>

2002.  As  of  June  30,  2003,  the  Canadian  dollar  increased  in  value  by
approximately  16.6%,  14.0% and 6.3% against each of the U.S. dollar, the Swiss
franc  and  Euro,  respectively, compared  to  the  exchange  rates for these
currencies as of December  31,  2002.

We  translate  assets  and  liabilities  of our foreign subsidiaries, other than
those  denominated  in  Canadian  dollars,  into Canadian dollars at the rate of
exchange on the balance sheet date.  Revenues and expenses are translated at the
average  rate  of  exchange  prevailing  during  the period. Unrealized gains or
losses  from  these  translations  are  recorded  as  shareholders' equity under
cumulative translation adjustment on the balance sheet and do not affect our net
earnings.  As  a  result  of  the  appreciation  of Canadian dollar against U.S.
dollar,  Swiss  franc and Euro as of June 30, 2003,  we reported approximately a
net $34.5 million unrealized foreign exchange translation loss in the six months
ended  June  30,  2003,  and our cumulative foreign exchange translation loss at
June  30,  2003  was $15.8 million, compared to a gain $18.7 million at December
31,  2002.

We  use  derivatives to manage our exposure and our clients' exposure to foreign
currency  exchange  rate  risks.  At  June 30, 2003, we did not hold any forward
foreign  exchange  contracts  for  our  own  account.

The  Company  reports  its  results in Canadian dollars.  Certain amounts herein
have  also  been  reported  in  U.S.  dollars  for  reference purposes.  Amounts
reported in U.S. dollars have been translated from Canadian dollars at a rate of
U.S.$1.00  = Canadian $1.3553 as at June 30, 2003, being the period-end exchange
rate  as  prescribed  by  Regulation  S-X (the accounting regulation of the U.S.
Securities  and  Exchange  Commission).

CERTAIN  FACTORS

Our primary risks are transaction risks, credit or counterparty risks and market
risks.  In  addition, we have been and may continue to be affected by many other
factors,  including,  but  not  limited  to: (i) economic and market conditions,
including  the  liquidity  of  capital  markets;  (ii)  the volatility of market
prices,  rates and indices; (iii) the timing and volume of market activity; (iv)
competition;  (v)  legal and regulatory risks; (vi) inflation; (vii) the cost of
capital,  including  interest  rates;  (viii)  political  events,  including
legislative,  regulatory  and  other  developments;  (ix)  competitive  forces,
including  our ability to attract and retain personnel; (x) support systems; and
(xi)  investor  sentiment. For more information on these risks and other factors
that affect us and our operating results, see our annual report on Form 20-F for
the  year  ended  December  31,  2002.

DERIVATIVE  INSTRUMENTS

Derivatives  are  financial instruments, the payments of which are linked to the
prices,  or relationships between prices, of securities or commodities, interest
rates,  currency  exchange  rates  or other financial measures.  Derivatives are
designed  to  enable  parties  to  manage  their  exposure to interest rates and
currency exchange rates, and security and other price risks.  We use derivatives
to  provide  products and services to clients and to manage our foreign exchange
exposure  for our own account.  At June 30, 2003, we did not hold any derivative
contracts  for  our own account.  For more information, see our annual report on
Form  20-F  for  the  year  ended  December  31,  2002.

                                       17

<PAGE>

INFLATION

We do not believe that inflation has had a material impact on revenues or income
during  the  second  quarter  of 2003.  Because our assets to a large extent are
liquid  in  nature,  they are not significantly affected by inflation.  However,
increases  in inflation could result in increases in our expenses, which may not
be readily recoverable in the price of services provided to our clients.  To the
extent  inflation results in rising interest rates and has other adverse effects
on  capital  markets,  it  could  adversely  affect  our  financial position and
profitability.

CRITICAL  ACCOUNTING  POLICIES

The  preparation  of  financial statements in conformity with generally accepted
accounting  principles requires our management to make estimates and assumptions
that  affect  the  reported  amounts of assets and liabilities and disclosure of
contingent  assets  and  liabilities at the date of the financial statements and
the  reported  amounts  of  revenues  and expenses during the reporting periods.

Our  management  routinely  makes  judgments  and estimates about the effects of
matters  that  are  inherently  uncertain.  As  the  number  of  variables  and
assumptions  affecting  the  probable  future  resolution  of  the uncertainties
increase,  these  judgments  become  even  more  subjective and complex. We have
identified  certain  accounting  policies  that  are  the  most important to the
portrayal  of  our  current  financial  condition  and  results  of  operations.

For  more  information  about  our  critical accounting policies, see our annual
report  on  Form  20-F  for  the  year  ended  December  31,  2002.

                                       18

<PAGE>

                                   SIGNATURES


Pursuant  to  the  requirements  of  the  Securities  Exchange  Act of 1934, the
Registrant  has  duly  caused  this  report  to  be  signed on its behalf by the
undersigned,  thereunto  duly  authorized.


Registrant          MFC  BANCORP  LTD.
                    --------------------------------

By                  /s/  Michael  J.  Smith
                    --------------------------------
                    MICHAEL  J.  SMITH,  PRESIDENT

Date                August 29, 2003
                    --------------------------------



</TEXT>
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