Bank of Montreal 1997 Annual Report Download - page 24

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1997 1996
(a)
Five-Year Average
Bank of 23 Bank of 23 Bank of 23
Montreal Bank Montreal Bank Montreal Bank
Performance Rank Average Performance Rank Average Performance Rank Average
Primary Financial Performance Measures
(%)
Five-year return on
common shareholders’
investment (ROI) 26.1 129.0 22.2 123.1 26.1
(c)
129.0
(c)
Fully diluted EPS growth 11.9 114.4 22.2 28.9 14.5 124.4
Return on average
common shareholders’
equity (ROE) 17.1 416.8 17.0 415.7 15.7 116.3
Revenue growth 15.1 414.0 9.9 115.5 10.1 111.9
Expense-to-revenue ratio 64.4 161.3 63.4 162.5 62.8 162.5
Provision for credit
losses as a % of
average loans
and acceptances 0.23 20.60 0.23 20.56 0.45 40.69
Primary Financial Condition Measures
(%)
Gross impaired loans
and acceptances as
a % of equity
and allowance for
credit losses 7.65 16.76 15.71 19.28 7.65
(d)
16.76
(d)
Tier 1 ratio
(b)
6.35 17.61 6.26 17.60 6.35
(d)
17.61
(d)
Cash and securities-
to-total assets 35.6 230.0 35.8 229.6 35.6
(d)
230.0
(d)
Credit rating AA
-
2A+AA
-
2A+AA
-
(d)
2A+
(d)
The selection of the 23 largest banks is based on the size of their 1996 common shareholders’ equity: Bank
of Montreal, The Bank of Nova Scotia, Canadian Imperial Bank of Commerce, Royal Bank of Canada,The Toronto-
Dominion Bank, Banc One Corp., BankAmerica Corporation, Bankers Trust New York Corporation, The Bank
of New York Company, Inc., The Chase Manhattan Corporation, Citicorp N.A., First Chicago NBD Corporation,
First Union Corporation, Fleet Financial Group, J.P. Morgan & Co. Inc., Keycorp, Mellon Bank Corporation,
NationsBank Corporation, Norwest Corporation, PNC Bank Corp., SunTrust Banks, Inc., Wachovia Corporation,
Wells Fargo & Company.
Note: Performance for the U.S. banks was based on the twelve-month period ended September 30 to approximate
the Canadian bank fiscal year which ended on October 31.
(a) Reclassified to conform with 1997 presentation.
(b) U.S. basis
(c) Reflects five-year ROI for the period ending October 31,1997.
(d) Condition ratios are as at October 31, 1997.
2Top Tier
4Above Average/Average
1Below Average
Our ranking in the North American peer group in 1997 was top tier in three of our ten financial measures,
namely provision for credit losses as a percentage of average loans and acceptances, cash and securities
-
to-total assets, and credit rating. Our ranking was above average in two categories, namely
ROE and
revenue
growth. We were below average on five measures, namely five-year ROI, fully diluted EPS growth,
expense-to-revenue ratio, gross impaired loans and acceptances as a percentage of equity and
allowance for credit losses, and the Tier 1 ratio.
We performed above average on the credit risk management measure, namely provision for credit
losses as a percentage of average loans and acceptances, in each of the past five years. We performed
below average on revenue growth and expense-to-revenue ratio in three of the past five years.
Our ranking relative to the North American peer group on a five-year average basis was top tier in
two and above average in one of our ten financial measures, namely cash and securities-to-total assets,
credit rating, and provision for credit losses as a percentage of average loans and acceptances, res-
pectively. We were below average on seven measures, namely five-year ROI, EPS growth, ROE, revenue
growth, expense-to-revenue ratio, gross impaired loans and acceptances as a percentage of equity
and allowance for credit losses, and the Tier 1 ratio.
North American Peer Group Comparison