Bank of Montreal 1998 Annual Report Download - page 6

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2
BANK OF MONTREAL GROUP OF COMPANIES
Our Annual Report’s theme this year makes
a dramatic claim, but one that has been well
justified in the event. On January 23, 1998,
we announced our agreement to merge with
Royal Bank of Canada, long one of our most
important competitors. Under Canadian law
such mergers require the approval of the
federal Minister of Finance. Shortly before
this Report went to press, Finance Minister
Paul Martin announced that he would not
approve our proposed merger and that the
government would consider mergers between
major Canadian banks only after extensive
legislative and regulatory changes. Enacting
the necessary legislation will require at least
one year and more probably two. Our merger
proposal has therefore been terminated with
the agreement of both banks.
Despite this disappointing outcome, the
proposed merger made 1998 truly a year when
everything changed for Bank of Montreal. We
said a firm good-bye to our past by choosing
a legitimate, effective and comprehensive
response to the forces that are creating a new
financial universe worldwide. I have men-
tioned those forces often in earlier Annual
Reports, and some of them are discussed later
in these pages: globalization, the continu-
ing integration of world markets; profound
demographic currents that are transforming
patterns of demand; customers who are
becoming steadily more knowledgeable and
exacting. Running through everything is the
digital revolution in information technology,
shrinking space and time and creating finan-
cial
products and customer expectations
that were unimaginable only a few years ago.
Together these forces are an irresistible tide
that will sweep away institutions unable to
find an effective response to them. In our
best judgement the merger was the option
most likely to bring substantial benefits to
our customers, employees and shareholders
within a reasonable period of time. Now that
THE YEAR EVERYTHING CHANGED
CHAIRMAN’S MESSAGE