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With public market issuance soaring last year, activity in the exempt market was surging too, according to a new report from the Ontario Securities Commission (OSC).

The regulator reported that, in 2021, issuers raised $175 billion in Ontario through prospectus exemptions, which was nearly double the pre-pandemic level of $90.4 billion in 2019.

“Much of this increase was driven by significant growth in U.S. and other foreign debt investments,” the OSC said.

The vast majority of the capital raised in the exempt market was from institutional investors, $171 billion worth (98% of the total), while just $4 billion came from retail investors.

According to the report, in 2020, $118 billion was raised from institutional investors and $2.8 billion from retail investors; and, in 2019, the total was $87 billion from institutions and $3.4 billion from individuals.

Most of the investments by individual investors (68%) in 2021 came in equity offerings of Canadian issuers, the report said.

“Real estate and mortgage-related investments continue to attract an increasing share of individual investor capital, growing from approximately 37% in 2019 to 43% in 2021.”

The accredited investor exemption remains the most frequently-used prospectus exemption by both retail (90%) and institutional investors (97%), the report noted.