The Maple bond market has experienced explosive growth, since the federal government removed the limits on foreign investment for pension and retirement funds in 2005.

The expected value of Maple bonds to be issued in 2007 exceeds $40 billion – about 50 per cent of all non-government issuance, says the Investment Industry Association of Canada

The IIAC has released “Made in Canada: The Maple Bond Market”, which explores the benefits of this burgeoning market and what the IIAC has been doing to remove impediments to further growth.

“For many institutional investors, Maple bonds are attractive investments as they are highly rated and allow investors to diversify geographically without incurring currency risk,” says Barbara Amsden, director, capital mrkets, IIAC.

“However, the Maple bond market still has some regulatory and cost impediments to overcome. We are working to ensure the market continues to grow to better meet the needs of Canadian investors.”

The Maple bond market benefits both the investor and the issuer, the IIAC says. For issuers, they provide a new funding alternative to complement their current sources at lower cost. For investors, Maples provide security, as all Maples to date are investment grade debt, and portfolio diversification.

As the selection of Maples increases, the IIAC says it expects to see added holdings in pension plans, which will share the diversification and other benefits with their plan participants.

For more information on Maple Bonds and to read Made in Canada: The Maple Bond Market visit www.iiac.ca.