Several bank-owned fund companies have received regulatory relief that allows their funds to invest in private placements they have underwritten, subject to several conditions.

The relief was sought by the fund management arms of CIBC, Royal Bank and Bank of Montreal, including BMO’s Guardian Group of Funds.

Collectively, they sought an exemption to allow their funds to purchase equity securities as part of a private placement, notwithstanding that their affiliates have acted as underwriter of the distribution.

The relief is granted providing that the investment decision is approved by the funds’ investment review committee, the issuer is a reporting issuer and it is subject to several transparency requirements.