Bank of Montreal 1999 Annual Report Download - page 9

Bank of Montreal Group of Companies 1999 Annual Report 7
The forces of change in the financial services indus-
try are well known and continued to escalate in
1999. Increased competition, globalization, disinter-
mediation, a changing regulatory environment,
commoditization of services and asset management
shifts all required a meaningful strategic response.
To achieve the desired scale and scope in the
businesses
we choose, our strategy will often
include the use of selective strategic alliances and
highly focused joint ventures. In areas of business
where we cannot achieve appropriate scale, we will
exit those businesses.
Our goal is clear. We must simply be the best-in-
class providers of products and services. By placing
an unwavering commitment to customer service
at the centre of our strategy, we will grow our core
businesses while maximizing value for all Bank
of Montreal shareholders.
Asafirststepintheimplementationofthisstrategy
we have reorganized the Bank of Montreal Group
of Companies by client group. The Personal and
Commercial Client Group (P&C)
—
accounting for
more than two-thirds of the Bank’s net income
this year —serves more than six million Canadian
households and commercial accounts and close
to one million U.S. customers.
Our retail mandate is to provide our personal,
small business and mid-market commercial cus-
tomers with what they want, when they want
it and where they need it most.
With a broad range of value propositions on offer,
it’s now the customers who decide how much they
are prepared to pay for the banking services they
need. Our commitment is to bring to this critically
important and sought-after client group a consis-
tently superior customer experience, plus the most
competitivearrayofproductsandservices,regard-
less of the access channel chosen.
An integral component of this strategy will be the
leveraging of operational synergies and economies
of scale across all lines of business in Canada,
the United States and Mexico
—
the three countries
wheretheBankoperates.OursisaNorthAmerica-
wide strategy.
Competing against the Monolines
A prime example of our aggressive, customer-
focused “we-want-your-business-and-we’ll do-what-
it-takes-to-win-it” attitude can be found in the
Bank’s homeowner mortgage business. We intend
to be a preferred supplier of homeowner mortgages
in Canada. By leveraging our existing strengths in
profitable market segments and then expanding into
under-served market niches, we will change the
way mortgage business is conducted. For example,
the recent purchase of IMC Mortgage Company,
Canada Ltd. (now known as Xceed Mortgage Cor-
poration), a company specializing in non-conform-
ing mortgages, is a key strategic initiative that
enables the Bank, uniquely among the Big Five, to
offer the full spectrum of prime and sub-prime
mortgage products.
Listening to our customers in order to understand
their needs is another core strategy. Extensive
customer research tells us that customers’ concerns
are focused on their largest single financial burden,
and its related anxieties and restrictions on financial
freedom and flexibility. It was to address these
con-
cerns that two innovative products were launched
...we approve about one new mortgage
every nine minutes
in September: the “18-year Open Term Mortgage,”
offering customers security and benefits found
nowhere else in the Canadian mortgage market, and
the “Investment Option Mortgage,” providing cus-
tomers with the opportunity to receive up to 3.5% of
the value of their fixed rate mortgage as an invest-
ment in Bank of Montreal RRSPs.
New products are just the beginning. Better
customer access is the key. Today, customers can
apply for a Bank of Montreal mortgage through the
traditional branch network, by telephone or online.
Deployment of a team of highly trained mortgage
specialists, available to do business when and where
our customers want, will further expand access.
Using the latest in laptop communications and supe-
rior
customer information technology, we’ll bring
mortgages right to the kitchen table.
Though highly competitive, the Bank has iden-
tified homeowner mortgages and consumer
financing as high-opportunity areas of great value
to our customers, which will serve to generate
significant long-term shareholder value.
Customers Want Choices
Banking is about customer service. We must listen
carefully to what our customers are telling us and