Merrill Lynch Canada's decision to sell its $2.8 billion in Canadian mutual fund assets to competitor Canadian Imperial Bank of Commerce may have been based on research that shows the wealth market in Canada is shrinking.

Late last month CIBC announced that it would acquire Merrill Lynch Canada's asset management, retail brokerage and securities services businesses for its brokerage unit, CIBC Wood Gundy, for between $475 million and $650 million (all numbers in U.S. dollars), with the final purchase price expected to be between $500 and $600 million.

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