Client assets soar during pandemic: IIAC

Investment dealers have added almost $1 trillion in assets under management (AUM) since the pandemic hit, according to new data from the Investment Industry Association of Canada (IIAC).

The industry trade group reported that total client AUM topped $3.6 trillion in August, compared with $2.69 trillion in February 2020. As the pandemic emerged in March 2020, client assets dropped to $2.43 trillion, but they’ve been steadily gaining ground since then.

Client margin borrowing has grown alongside the increase in AUM. Pre-pandemic, margin borrowing totalled just under $26 billion. In August, margin debt was up over $36 billion.

The industry’s revenue mix has shifted sharply during the pandemic period as well.

Investment banking, fee and commission revenues are all up (mutual fund commissions are flat), but interest-based revenues have plunged alongside rates.

Monthly interest revenues averaged $985 million before the pandemic and just $367 million since it took hold, the data showed.

Net interest revenues (revenues minus financing costs) are down from $237.9 million in February 2020 to $123.4 million in August.

According to the IIAC data, overall industry revenues are down a bit from pre-pandemic levels. Average monthly revenues before the pandemic were $2.77 billion, and they’ve averaged $2.56 billion during the pandemic (through August 2021).

At the same time, average monthly expenses are up from $807 million pre-pandemic to $854 million during the pandemic.

James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.