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Tough times, rising costs have chewed up 25% of Canada’s small investment firms: IIAC

Ian Russell, chief executive of the Investment Industry Association of Canada, says “significant contraction” of small investment firms is expected over the next couple of years.

TORONTO — Restructuring and consolidation in a tough economy and escalating regulatory costs have led to the disappearance or reconstitution of a full 25 per cent of investment firms in Canada during the past three years, according to the Investment Industry Association of Canada.

More than 50 boutique firms are gone, including some that have been overhauled to operate solely in Canada’s less onerous, lower-cost exempt market, Ian Russell, the IIAC’s chief executive, told a luncheon Tuesday in Toronto.

Other small and mid-sized firms have folded outright or been amalgamated.

Despite the consolidation that has already taken place, “significant contraction” is expected during the next couple of years, said Russell, who based his view on a recent survey the IIAC conducted by tapping the chief executives of the association’s 144 investment dealer members.

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