Bank of Montreal 2012 Annual Report Download - page 55

MD&A
MANAGEMENT’S DISCUSSION AND ANALYSIS
Private Client Group
Private Client Group (PCG), BMO’s group of wealth management businesses, serves a full range of client segments from
mainstream to ultra-high net worth and institutional, with a broad offering of wealth management products and solutions
including insurance products. PCG operates in Canada and the United States, as well as in Asia and Europe.
“Gaining a deeper understanding of our clients’
needs, to help them fulfill their future goals, is
one of our top priorities. Having a full breadth of
innovative and high-value products and solutions
is one of the ways we are helping satisfy the
complete financial needs of our retail, high net
worth and institutional clients.”
Gilles Ouellette
President and Chief Executive Officer
Private Client Group
Strengths and Value Drivers
‰A planning and advice-based approach that integrates investments,
insurance, specialized wealth management and core banking
solutions.
‰A team of highly skilled wealth professionals committed to providing
an exceptional client experience.
‰Brand prestige, recognition and trust.
‰Strong national presence in Canada, as well as strategic positioning in
select high-growth U.S. and emerging wealth management markets.
‰Access to BMO’s broad client base and distribution network in Canada
and the United States.
‰A culture of innovation focused on achieving competitive advantage.
Challenges
‰Low interest rate environment that constrains revenue growth.
‰Evolving client needs based on changing demographics and rapidly
advancing technology.
‰Increasing regulatory complexity, requiring proactive engagement
and oversight.
‰Erosion of consumer confidence in market performance.
‰Competition for top talent.
Our Strategies
Our vision is to be the wealth management solutions provider that
defines great client experience. Our strategy is to deliver on our
clients’ wealth management needs now and in the future. Our
priorities include:
‰Building client loyalty through a deeper understanding of their
needs.
‰Focusing on productivity to control costs while growing revenue.
‰Increasing penetration of financial planning across BMO.
‰Improving awareness and use of appropriate BMO products for
our clients.
‰Investing for the future in targeted high-growth areas.
Our Path to Differentiation
‰Deliver a personalized and unique financial planning experience
to our clients.
‰Attract, develop and retain superior talent.
‰Continue to build a culture of innovation.
Key Performance Metrics and Drivers 2012 2011* 2010
Adjusted net income growth (%) 12.1 11.2 20.3
Revenue growth (%) 12.1 14.6 12.1
Adjusted operating leverage (%) (0.5) (1.6) 5.1
Average loans and acceptances growth (%) 16.4 19.3 4.2
Average deposit growth (%) 14.1 11.5 12.8
Assets under management and
administration growth (%) (1) 9.4 61.9 12.7
Employee engagement index (%) (2) 76 77 75
2010 based on CGAAP.
(1) Excludes the impact of changes in the Canadian/U.S. dollar exchange rate.
(2) Source: BMO Annual Employee Survey, conducted by Burke Inc., an independent research
company.
* Growth rates for 2011 reflect growth based on CGAAP in 2010 and IFRS in 2011.
Our Lines of Business
BMO Nesbitt Burns, our full-service investing business in Canada, offers
comprehensive and client-focused investment and wealth advisory
services, leveraging strong financial planning capabilities, a broad range
of internal and external relationships and high-quality products.
BMO InvestorLine, our online investing business in Canada, offers cli-
ents a range of tools to help self-directed investors plan, research and
manage investing decisions their own way. BMO InvestorLine recently
launched in Canada adviceDirect, the first service in Canada that pro-
vides investing advice to online investors.
BMO’s private banking businesses operate in Canada and the United
States and plan to expand into Hong Kong and Singapore. Offering a
comprehensive range of financial services and solutions, we deliver a
planning and advice-based value proposition to high net worth and
ultra-high net worth clients and, under the BMO Harris Financial Advisors
brand, to mass affluent clients in the United States.
BMO Global Asset Management is a global investment organization
that provides investment management, trust, custody, securities lending
and retirement planning services to institutional, retail and high net
worth investors around the world. Our BMO Mutual Funds and BMO
Exchange Traded Funds businesses offer our clients innovative invest-
ment solutions across a range of channels.
BMO Insurance operates in Canada and internationally. In Canada, it
manufactures life insurance, health insurance and annuity products that
are marketed both to brokers and directly to individuals. Our creditor
insurance division markets group creditor insurance (life, disability, job
loss) in connection with BMO’s retail and commercial loans, mortgage
and credit card products and travel insurance. Internationally, BMO
Insurance provides reinsurance solutions.
Caution
This Private Client Group section contains forward-looking statements.
Please see the Caution Regarding Forward-Looking Statements.
52 BMO Financial Group 195th Annual Report 2012