Bank of Montreal 1998 Annual Report Download - page 67

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BANK OF MONTREAL GROUP OF COMPANIES
TABLE 8 NON-INTEREST EXPENSES AND EXPENSE-TO-REVENUE RATIOS ($ millions except as noted)
For the year ended October 31 1998 19 97 199 6 19 9 5 19 9 4 19 9 3 19 92 1991 199 0 19 8 9
Non-Interest Expense Summary
Total non-interest expense 4,833 4,613 3,949 3,646 3,223 2,916 2,765 2,605 2,453 2,330
Less: Goodwill and other
valuation intangibles 72 74 54 49 31 30 36 36
Charges/non-recurring items (a) 075 23 60 71 0 18 24
Total operating non-interest expense 4,761 4,464 3,872 3,537 3,121 2,886 2,711 2,545
Year-over-year growth (%)
To t a l 4.7 16.8 8.3 13.1 10.5 5.5 6.1 6.2 5.3 1.4
Operating 6.6 15.3 9.5 13.3 8.1 6.5 6.5 7.7
Non-Interest Expense Detail
Salaries 2,370 2,284 1,972 1,758 1,567 1,455 1,348 1,277
Employee benefits 204 251 238 241 228 209 201 167
Total salaries and employee benefits 2,574 2,535 2,210 1,999 1,795 1,664 1,549 1,444
Premises and equipment
Rental of real estate 147 149 139 136 125 123 114 101
Premises, furniture and fixtures 256 234 215 206 188 177 170 179
Property taxes 51 40 40 41 39 40 37 40
Computers and equipment 518 493 333 296 248 240 234 215
Total premises and equipment 972 916 727 679 600 580 555 535
Communications 266 246 219 208 180 165 167 174
Other expenses
Business and capital taxes 134 128 116 110 95 92 82 64
Professional fees 320 250 173 141 112 64 63 55
Travel and business development 234 238 199 161 144 122 112 156
Deposit insurance premiums (b) 75 73 94 84 76 62 55 48
Other 186 153 157 155 119 137 146 93
Total other expenses 949 842 739 651 546 477 458 416
Goodwill and other valuation intangibles 72 74 54 49 31 30 36 36
Special charge 000071000
Business process improvement initiative charge 000600000
Total non-interest expense 4,833 4,613 3,949 3,646 3,223 2,916 2,765 2,605 2,453 2,330
Government Levies and Taxes (c)
Government levies other than income taxes
Payroll levies 128 123 109 106 95 88 83 72
Property taxes 51 40 40 41 39 40 37 40
Provincial capital taxes 120 104 89 84 71 71 59 42
Business taxes 14 24 27 26 24 21 23 22
Goods and services tax and sales tax 125 114 101 88 70 64 61 49
Deposit insurance 75 73 94 84 76 62 55 48
Total government levies other than income taxes 513 478 460 429 375 346 318 273
Provision for income taxes reported in:
Statement of income 804 840 757 662 560 487 416 384
Statement of retained earnings (237) (92) 10 9 (23) (46) (70) 37
Total income taxes 567 748 767 671 537 441 346 421
Total government levies and taxes 1,080 1,226 1,227 1,100 912 787 664 694
Total government levies and taxes as a % of net
income before taxes and government levies 40.5 46.7 51.4 53.0 51.8 51.1 48.3 55.4
Productivity Analysis
Expense-to-revenue ratio (%) 66.5 64.4 63.4 64.3 62.0 60.0 62.2 65.2 67.2 65.0
Non-recurring revenue 1000006(8)
Adjusted expense-to-revenue ratio (%) (d) 65.5 62.3 62.2 62.4 60.1 59.4 61.1 63.6
Adjusted expense-to-revenue ratio (d) excluding
Investment and Corporate Banking (%) 60.3 59.0 59.2 59.7 58.5 58.2 NA NA
(a) The charge/non-recurring item in 1997 is a charge for accelerated depreciation
related to technology changes and credit process efficiency improvements, in 1996
is the Harris Savings Association Insurance Fund (SAIF) charge, in 1995 is the busi-
ness process improvement initiative charge and in 1994 is the Harris special charge.
(b) Includes the SAIF charge.
(c) Government levies are included in various non-interest expense categories.
(d) The adjusted expense-to-revenue ratio excludes non-recurring expenses, goodwill
and other valuation intangibles from expenses and non-recurring revenues from
total revenue.
NA – Not available