Bank of Montreal 2014 Annual Report Download - page 98

Supplemental Information
Table 4: Non-Interest Expense and Expense-to-Revenue Ratio ($ millions, except as noted)
For the year ended October 31 2014 2013 2012 2011 2010
5-year
CAGR
10-year
CAGR
Non-Interest Expense
Employee compensation
Salaries 3,388 3,259 3,148 2,646 2,285 7.2 6.0
Performance-based compensation 1,946 1,686 1,657 1,560 1,455 7.8 5.3
Employee benefits 908 897 808 621 624 6.9 4.5
Total employee compensation 6,242 5,842 5,613 4,827 4,364 7.3 5.5
Premises and equipment
Rental of real estate 415 416 400 360 319 6.2 8.6
Premises, furniture and fixtures 261 377 368 310 269 (0.8) (0.1)
Property taxes 39 37 36 30 28 5.9 (2.8)
Computers and equipment (1) 1,193 1,003 1,071 878 727 12.1 5.8
Total premises and equipment (1) 1,908 1,833 1,875 1,578 1,343 8.3 nm
Other expenses
Amortization of intangible assets (1) 382 346 331 231 203 13.6 nm
Communications 289 291 301 259 229 5.5 7.6
Business and capital taxes 39 39 46 51 52 (3.1) (9.0)
Professional fees 622 527 593 624 401 11.4 9.0
Travel and business development 542 514 491 382 343 11.9 8.5
Other 897 834 885 789 684 9.2 7.6
Total other expenses 2,771 2,551 2,647 2,336 1,912 10.1 8.6
Total Non-Interest Expense 10,921 10,226 10,135 8,741 7,619 8.1 5.9
Year-over-year total non-interest expense growth (%) 6.8 0.9 15.9 14.7 3.2 na na
Total Adjusted Non-Interest Expense 10,761 9,755 9,410 8,453 7,583 8.3 5.9
Year-over-year total adjusted non-interest expense growth (%) 10.3 3.7 11.3 11.5 5.0 na na
Non-interest expense-to-revenue ratio (Efficiency ratio) (%) 65.3 63.7 63.6 62.7 62.2 na na
Adjusted non-interest expense-to-revenue ratio (Efficiency ratio) (%) 64.4 63.5 63.3 61.5 62.0 na na
Efficiency ratio, excluding PBCAE (2) 59.9 60.8 59.3 – – na na
Adjusted efficiency ratio, excluding PBCAE (2) 59.1 60.4 58.7 – – na na
Government Levies and Taxes (3)
Government levies other than income taxes
Payroll levies 252 249 250 203 175 8.0 4.4
Property taxes 39 37 36 30 28 5.9 (2.8)
Provincial capital taxes 27 30 37 44 45 (5.3) (11.3)
Business taxes 97 9770.3 1.4
Harmonized sales tax, GST and other sales taxes 273 262 249 235 146 18.7 6.2
Sundry taxes 21 211
nm nm
Total government levies other than income taxes 602 586 583 520 402 10.6 2.6
Provision for income taxes 903 1,055 874 876 687 nm (0.7)
Total Government Levies and Taxes 1,505 1,641 1,457 1,396 1,089 20.9 0.5
Total government levies and taxes as a % of income available to pay
government levies and taxes 25.0 28.7 26.6 31.0 27.4 na na
Effective income tax rate (%) 17.2 20.1 17.4 22.0 19.2 na na
Adjusted effective income tax rate (%) 17.5 19.7 18.6 21.7 19.2 na na
2010 and prior based on CGAAP. Five-year and ten-year CAGR based on CGAAP in 2009 and 2004, respectively, and on IFRS in 2014. 2011 growth rates based on CGAAP in 2010 and IFRS in 2011.
2011 has not been restated to reflect the new IFRS standards adopted in 2014.
(1) In 2009, we adopted new accounting requirements for intangible assets and reclassified certain computer equipment from premises and equipment to intangible assets. Computer and equipment
expense and the amortization of intangible assets were restated, but not for years prior to 2007. As such, ten-year growth rates for these expense categories are not meaningful. Together, computer
and equipment expense and the amortization of intangible assets increased at a compound annual growth rate of 6.2% over ten years. Together, total premises and equipment expense and the
amortization of intangible assets increased at a compound annual growth rate of 5.4% over ten years.
(2) This ratio is calculated excluding insurance policyholder benefits, claims and acquisition expenses (PBCAE).
(3) Government levies are included in various non-interest expense categories.
na – not applicable
nm – not meaningful
BMO Financial Group 197th Annual Report 2014 109