Bank of Montreal 2013 Annual Report Download - page 126

Unrealized Gains and Losses Available-for-sale Available-for-sale
(Canadian $ in millions) securities 2013 securities 2012
Gross Gross Gross Gross
Amortized unrealized unrealized Fair Amortized unrealized unrealized Fair
cost gains losses value cost gains losses value
Issued or guaranteed by:
Canadian federal government 12,989 129 3 13,115 17,050 265 38 17,277
Canadian provincial and municipal governments 3,707 23 32 3,698 2,642 39 1 2,680
U.S. federal government 4,650 10 – 4,660 10,010 89 – 10,099
U.S. states, municipalities and agencies 5,363 41 12 5,392 4,390 83 11 4,462
Other governments 6,165 7 9 6,163 6,591 10 5 6,596
Mortgage-backed securities and collateralized mortgage obligations – Canada (1) 2,271 6 – 2,277 432 3 – 435
Mortgage-backed securities and collateralized mortgage obligations – U.S. 6,535 24 31 6,528 5,705 78 10 5,773
Corporate debt 9,569 115 8 9,676 7,724 169 18 7,875
Corporate equity 1,411 148 1 1,558 1,129 59 3 1,185
Total 52,660 503 96 53,067 55,673 795 86 56,382
(1) These amounts are supported by insured mortgages.
Available-for-sale Available-for-sale
Unrealized Losses securities in an unrealized securities in an unrealized
(Canadian $ in millions) loss position for 2013 loss position for 2012
Less than 12 months Less than 12 months
12 months or longer Total 12 months or longer Total
Gross Gross Gross Gross Gross Gross
unrealized Fair unrealized Fair unrealized Fair unrealized Fair unrealized Fair unrealized Fair
losses value losses value losses value losses value losses value losses value
Issued or guaranteed by:
Canadian federal government 3 721 – – 3 721 38 811 – – 38 811
Canadian provincial and municipal governments 30 1,662 2 26 32 1,688 1 107 – – 1 107
U.S. federal government – – – – – – – 1,155 – – – 1,155
U.S. states, municipalities and agencies 11 1,385 1 317 12 1,702 11 244 – 3 11 247
Other governments 8 1,142 1 1,316 9 2,458 1 2,455 4 1,059 5 3,514
Mortgage-backed securities and collateralized mortgage obligations – Canada (1) –74 – – –74 –41 – 4 –45
Mortgage-backed securities and collateralized mortgage obligations – U.S. 30 4,005 1 143 31 4,148 10 1,551 – – 10 1,551
Corporate debt 8 2,753 – 37 8 2,790 17 526 1 31 18 557
Corporate equity 196 –2 198 317 – 2 319
Total 91 11,838 5 1,841 96 13,679 81 6,907 5 1,099 86 8,006
(1) These amounts are supported by insured mortgages.
Income from securities has been included in our consolidated financial statements as follows:
(Canadian $ in millions) 2013 2012 2011
Reported in Consolidated Statement of Income:
Interest, Dividend and Fee Income (1)
Trading securities (2) 1,409 1,621 1,492
Available-for-sale securities 610 561 626
Held-to-maturity securities 47 1 –
Other securities 77 82 58
2,143 2,265 2,176
Non-Interest Revenue
Available-for-sale securities
Gross realized gains 90 153 223
Gross realized losses (3) (24) (85)
Unrealized gain on investment reclassified from equity method accounting to available-for-sale 191 – –
Other securities, net realized and unrealized gains (losses) 24 28 55
Impairment write-downs (17) (5) (4)
Securities gains (losses), other than trading (1) 285 152 189
Trading securities, net realized and unrealized gains (losses) (1) (2) 477 374 546
Total income from securities 2,905 2,791 2,911
(1) The following amounts of income related to our insurance operations were included in non- (2) The following amounts of trading securities, net realized and unrealized gains (losses) are
interest revenue, insurance income in our Consolidated Statement of Income: related to our insurance operations:
Interest, dividend and fee income of $263 million for the year ended October 31, 2013 Trading securities, net realized and unrealized gains (losses) of $(190) million for the year
($253 million in 2012 and $226 million in 2011). Securities gains (losses), other than trading ended October 31, 2013 ($286 million in 2012 and $6.5 million in 2011).
of $1 million for the year ended October 31, 2013 ($nil in 2012 and $15 million in 2011).
Note 4: Loans, Customers’ Liability under Acceptances
and Allowance for Credit Losses
Loans rate to the carrying amount of the loan. The effective interest rate is
Loans are initially measured at fair value plus directly attributable costs, defined as the rate that exactly discounts estimated future cash receipts
and are subsequently measured at amortized cost using the effective through the expected term of the loan to the net carrying amount
interest method. The effective interest method allocates interest income of the loan. The treatment of interest income for impaired loans is
over the expected term of the loan by applying the effective interest described below.
BMO Financial Group 196th Annual Report 2013 137
Notes