Toronto-based BMO Investments Inc. will discontinue the deferred sales charge (DSC) option for new mutual fund purchases later this year.
The firm said on Friday that it would no longer offer the low-load DSC purchase option across its mutual fund lineup around Nov. 1. Clients already invested in low-load options will remain invested “based on the redemption fee schedule applicable to those securities,” a release said.
The Canadian Securities Administrators’ ban on DSC mutual funds will take effect in 2022 in all jurisdictions except Ontario, which will instead adopt a series of restrictions on sales of the funds.
DSC funds have seen “deep net redemptions” for more than a decade, according to Investor Economics. At the end of 2019, DSC assets in Canada represented 7.4% of the industry total, the firm said in a March report.