Bank of Montreal 1997 Annual Report Download - page 16

Bank of Montreal 180th Annual Report 199714
President’s Message This may seem to be a bold claim, but it has his-
tory on its side. Over the last five years your
Bank has delivered a 26.1% return on shareholder
investment while the TSE 300 Index companies
produced a return of only 18.1%. That superior
overall return was driven by a healthy balance of
a 158% rise in the market price of common shares
and a $0.49 rise in the annual dividends paid on
them. Looking at 1997 alone, we earned a return
on shareholder investment
of 55.0%, more than
doubling the market return of 24.4%.
While building shareholder value, it should
be noted, your Bank contributed to economic
growth by lending $57.9 billion to Canadian indi-
viduals and small and medium-sized businesses.
We also contributed $1,226 million to the public
coffers in the form of taxes and government
levies, compared to $1,227 million last year. This
represented 46.7% of our annual income.
These consistently strong results admittedly
owe a good deal to the robust North American
economy, to the bull market in shares, and to
higher valuations for Canadian banks in general.
But they also owe a good deal to a particularly
powerful performance by the Bank of Montreal
Group of Companies. You will find more details
on all of these factors beginning on page 21 of
the Management Analysis of Operations which
immediately follows this message.
I would like to take you through the highlights
of our 1997 results, which are treated in greater
detail later in this Report. They demonstrate that
your Bank has performed strongly across a wide
range of financial measures. This in turn reflects
our well-balanced strategy of constant innovation,
superb risk management, and earning, growing and
investing all at the same time. The broadly based
strength of our performance gives us confidence we
can continue to create this kind of value in years
when the business environment may be less favour-
able. We look forward to the future with confidence,
because we are prepared for the dangers and
poised to take advantage of the opportunities.
Earnings and Profitability: Eight Straight
Years of Growth
The 1997 fiscal year marked our eighth consecu-
tive year of earnings growth as measured by fully
diluted earnings per share (EPS), and the fourth
consecutive year in which EPS exceeded our 10%
growth objective. Average EPS growth
over the
past five years was 14.5%.
Shareholder Value Reaches
an All-Time High
As you have seen, this 1997 Annual Report
puts the spotlight on the fundamental
purpose of our business, the creation of
value for our shareholders. Our ability
to deliver enhanced shareholder value
consistently is the single most important
standard by which we judge our success.
In the preceding pages you have had
an opportunity to read about some of the
many initiatives we have undertaken to
build that value in the past eight years 
and, we believe, to produce even greater
value for you in the years ahead.
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2
3
4
5
6
9796959493929190
Growth of a dollar invested in
Bank of Montreal common shares*
($)
5.34
2.18
Bank of Montreal TSE 300
* Assumes reinvestment of common share dividends.