Q3 2024 Bank of Montreal Earnings Call Transcript
Key Points
- Bank of Montreal (BMO) delivered record pre-provision pretax earnings of $3.5 billion, up 8% year-over-year.
- The bank achieved positive operating leverage of 5.2% for the quarter and 1.3% year-to-date.
- Canadian Personal and Commercial Banking saw record revenue growth of 7% year-over-year.
- BMO Wealth Management's net income increased by 44% year-over-year, driven by strong client asset growth.
- BMO Capital Markets reported strong client activity and revenue performance, with PPPT of $625 million.
- Loan loss provisions were above historical ranges, driven by cyclical increases in credit costs.
- Impaired provisions were significantly impacted by a limited number of accounts, with 15 accounts comprising almost 50% of year-to-date impaired provisions.
- The bank's adjusted EPS was down from $2.94 last year to $2.64, an 8% decrease.
- Net interest margins (NIM) were pressured by lower deposit margins, particularly in Canadian and US P&C.
- The bank expects impaired provisions to remain elevated over the next few quarters, with a return to normalized levels anticipated in 2025.
This conference is being recorded. All participants, please stand by. Your conference is ready to begin. Good morning, and welcome to BMO Financial Group's Q3 2024 earnings release and conference call for August 27, 2024. Your host for today is Christine Viau. Please go ahead.
Thank you, and good morning. We will begin the call with remarks from Darryl White, BMO's CEO; followed by Tayfun Tuzun, our Chief Financial Officer; and Piyush Agrawal, our Chief Risk Officer. Also present to take questions are Ernie Johannson, Head of BMO North American Personal and Business Banking; Nadim Hirji, Head of BMO Commercial Banking; Alan Tannenbaum, Head of BMO Capital Markets; Deland Kamanga, Head of BMO Wealth Management; and Darrel Hackett, BMO US CEO.
(Event Instructions)
As noted on slide 2, forward-looking statements may be made during this call, which involve assumptions that have inherent risks and uncertainties. Actual results differ materially from these statements. I would also remind listeners that
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