Company Reports

Bank of Montreal is the fourth-largest bank in Canada and one of six Canadian banks that collectively hold almost 90% of the nation's banking deposits. The bank has a well-established Canadian franchise, a solid US presence in the Midwest, and a growing California footprint. While BMO is not among the most dominant retail banks in Canada, its more commercially oriented loan book gives it a strong position in domestic commercial lending. BMO is also the second-largest exchange-traded fund provider in Canada. Although competition from BlackRock and Vanguard is intensifying, we expect continued growth in passive investing to support longer-term opportunities for leading players.

Bank of Montreal reported strong fiscal third-quarter results, with adjusted earnings per share of CAD 3.96 up 23% from the prior-year quarter. These results translate into an adjusted return on equity of 14.0%, up 200 basis points year over year but still below the bank's 15% medium-term target.

Royal Bank of Canada and BMO Financial Group announced on Aug. 10 that they have agreed to sell jointly owned payment processing business Moneris Solutions to Francisco Partners, a private equity firm, for cash consideration of approximately CAD 2 billion.

Bank of Montreal is the fourth-largest bank in Canada and one of six Canadian banks that collectively hold almost 90% of the nation's banking deposits. The bank has a well-established Canadian franchise, a solid US presence in the Midwest, and a growing California footprint. While BMO is not among the most dominant retail banks in Canada, its more commercially oriented loan book gives it a strong position in domestic commercial lending. BMO is also the second-largest exchange-traded fund provider in Canada. Although competition from BlackRock and Vanguard is intensifying, we expect continued growth in passive investing to support longer-term opportunities for leading players.

Bank of Montreal reported strong fiscal second-quarter results, as adjusted earnings per share of CAD 3.67 rose 40% from the year-ago quarter. The results translate to an adjusted return on equity of 13.5%, improving 370 basis points year over year, though still below the 15% medium-term target.

On May 12, Bank of Montreal announced a definitive agreement to sell its transportation finance and vendor finance loan portfolios to Stonepeak. The transaction is subject to regulatory and customary closing conditions. Shares of BMO traded down by around 0.8% intraday on the Toronto Stock Exchange.

Bank of Montreal is the fourth-largest bank in Canada and one of six Canadian banks that collectively hold almost 90% of the nation's banking deposits. About 60% of BMO’s earnings are generated in Canada and 40% in the US. The bank has a well-established Canadian franchise, a solid US presence in the Midwest, and a growing California footprint. While BMO is not among the most dominant retail banks in Canada, its more commercially oriented loan book gives it a strong position in domestic commercial lending. BMO is also the second-largest exchange-traded fund provider in Canada. Although competition from BlackRock and Vanguard is intensifying, we expect continued growth in passive investing to support longer-term opportunities for leading players.

Bank of Montreal reported OK results, with adjusted EPS of CAD 3.48, up 14% from the prior-year quarter. This quarter’s results translate into an adjusted ROE of 12.4%, improving by 110 basis points year over year, but it’s still below its 15% medium-term target.

Bank of Montreal's wealth management and capital markets segments had a strong performance in fiscal 2025, with adjusted earnings growth of around 30% in both segments.

Bank of Montreal is the fourth-largest bank in Canada and one of six Canadian banks that collectively hold almost 90% of the nation's banking deposits. Roughly 60% of BMO’s earnings are generated in Canada and 40% in the US. The bank has a well-established Canadian franchise, a solid US presence in the Midwest, and a growing California footprint following the Bank of the West, or BOTW, acquisition. While BMO is not among the most dominant retail banks in Canada, its more commercially oriented loan book gives it a strong position in domestic commercial lending, particularly for loans under CAD 100 million. BMO is also the second-largest exchange-traded fund provider in Canada. Although competition from BlackRock and Vanguard is intensifying, we expect continued growth in passive investing to support longer-term opportunities for leading players.

Narrow-moat Bank of Montreal reported OK results in the fourth quarter, with adjusted EPS of CAD 3.28, up 1.5% sequentially. Fiscal 2025 adjusted return on equity came in at 11.3%, which it improved by 150 basis points above its fiscal 2024 level, but it is still below its 15% medium-term target.

Bank of Montreal is the fourth-largest bank in Canada and one of six Canadian banks that collectively hold almost 90% of the nation's banking deposits. It derives roughly 60% of its earnings from Canada and 40% from the United States. BMO has a well-established Canadian banking presence, an established US retail operation in the Midwest, and an expanding California business through the Bank of the West, or BOTW, acquisition. BMO is not one of the largest or most dominant retail banks in Canada. However, with its more commercially focused book, it boasts a good share in its domestic commercial lending market, particularly for loans under CAD 100 million. BMO is the second-largest exchange-traded fund provider in Canada. Competing against BlackRock and Vanguard will likely get more difficult, but we expect passive to continue to grow in Canada, supporting future growth for major players.

Bank of Montreal reported strong third-quarter results, with adjusted EPS of CAD 3.23, up 22.3% from a year ago, driven by both top-line growth and lower provisioning expenses. That said, we think there is still uncertainty in the Canadian economy as a trade deal has yet to be reached with the US.

Bank of Montreal reported OK results, with adjusted EPS of CAD 2.62, up 1% from a year ago. Investors should be aware that the trajectories of the Canadian and US economies have heightened uncertainty related to tariffs.

On April 2, US President Donald Trump announced sweeping tariffs on goods imported from the rest of the world. Canada and Mexico were spared from these new tariffs; however, the previously announced tariffs on Canada are still in place, and the 25% global auto tariff has taken effect.

Bank of Montreal is the fourth-largest bank in Canada and one of six Canadian banks that collectively hold almost 90% of the nation's banking deposits. It derives roughly 60% of its earnings from Canada and 40% from the United States. BMO has a well-established Canadian banking presence, an established US retail operation in the Midwest, and an expanding California business through the Bank of the West, or BOTW, acquisition. BMO is not one of the largest or most dominant retail banks in Canada. However, with its more commercially focused book, it boasts a good share in its domestic commercial lending market, particularly for loans under CAD 100 million. BMO is the second-largest exchange-traded fund provider in Canada. Competing against BlackRock and Vanguard will likely get more difficult, but we expect passive to continue to grow in Canada, supporting future growth for major players.

After taking a fresh look at Bank of Montreal, we are slightly increasing our fair value estimates to CAD 146 and USD 102 from CAD 145 and USD 102. We also maintain our narrow moat and Standard Morningstar capital allocation ratings. We view shares as fairly valued.

Bank of Montreal started out its fiscal 2025 year strong, with revenue increasing 21% to CAD 9.27 billion, partially thanks to a 75% jump in trading revenue. Meanwhile, net income increased 65%, or 21% on an adjusted basis.

On Feb. 1, the Trump administration announced a 25% tariff on Canadian goods and a 10% tariff on Canadian oil and gas goods. The Canadian government announced a retaliatory tariff later on Feb. 1, starting with 25% tariffs on CAD 30 billion of US products like beverages, cosmetics, and paper products (effective on Feb. 4) and on an additional CAD 125 billion of US goods including cars and trucks (effective in three weeks).

Bank of Montreal is the fourth-largest bank in Canada and one of six Canadian banks that collectively hold almost 90% of the nation's banking deposits. It derives roughly 60% of its revenue from Canada and 30% from the United States. BMO has a well-established Canadian banking presence, an established US retail operation in the Midwest, and growing commercial and capital markets capabilities. It is the second-largest asset manager of the Canadian banks as well as the second-largest exchange-traded fund provider in Canada.