Bank of Montreal 2003 Annual Report Download - page 45

BMO Financial Group 186th Annual Report 2003 41
Summary Balance Sheet ($ millions)
As at October 31 2003 2002 2001 2000 1999
Assets
Cash resources 19,860 19,305 17,656 18,508 24,036
Securities 54,790 43,715 37,676 46,463 43,273
Net loans and acceptances 146,156 149,596 144,765 142,447 144,754
Other assets 35,688 40,248 39,312 25,978 18,552
Total 256,494 252,864 239,409 233,396 230,615
Liabilities and
Shareholders’ Equity
Deposits 171,551 161,838 154,290 156,697 156,874
Other liabilities 69,605 75,338 69,763 59,847 58,048
Subordinated debt 2,856 3,794 4,674 4,911 4,712
Share capital
Preferred 1,446 1,517 1,050 1,681 1,668
Common 3,662 3,459 3,375 3,173 3,190
Contributed surplus 3 ––––
Retained earnings 7,371 6,918 6,257 7,087 6,123
Total 256,494 252,864 239,409 233,396 230,615
Total assets increased $3.6 billion or 1% from last year to $256.5
billion at October 31, 2003, even though the lower Canadian/U.S.
dollar exchange rate reduced assets by $16.4 billion. There was
an $11.1 billion increase in securities, which was partially offset
by a $3.4 billion reduction in net loans and acceptances. Other
assets declined $4.6 billion, primarily due to lower amounts due
from clients, dealers and brokers and lower fair values of deriv-
ative financial instruments. The comparable elements in other
liabilities declined by similar amounts.
Note 9 on page 83 of the financial statements provides details
on fair values of derivative financial assets and liabilities.
Securities ($ millions)
As at October 31 2003 2002 2001 2000 1999
Investment securities 19,660 21,271 21,470 24,469 26,027
Trading securities 35,119 22,427 16,200 21,994 17,246
Loan substitute securities 11 17 6 ––
Total 54,790 43,715 37,676 46,463 43,273
Trading secur ities increased $12.7 billion to $35.1 billion, as
corporate equity investments grew by $9.1 billion in response
to growth in equity and credit derivatives businesses and other
market opportunities. Corporate debt investments increased
$2.8 billion.
Investment securities decreased $1.6 billion to $19.7 billion,
largely due to lower holdings of U.S. government securities. Net
unrealized gains on investment securities were $312 million,
compared with $321 million a year ago. Unrealized gains
increased on corporate debt and equity but declined on govern-
ment debt.
Note 3 on page 75 of the financial statements provides further
details on securities.
Net Loans and Acceptances ($ millions)
As at October 31 2003 2002 2001 2000 1999
Residential mortgages 52,095 47,569 41,941 39,485 38,189
Consumer instalment
and other personal loans 22,103 21,168 19,107 18,038 16,912
Credit cards 2,967 2,280 1,527 1,407 1,160
Businesses and governments* 51,889 57,963 61,249 60,176 58,027
Acceptances 5,611 6,901 7,936 8,630 6,753
Securities purchased under
resale agreements 13,276 15,664 14,954 16,308 25,090
Gross loans and acceptances 147,941 151,545 146,714 144,044 146,131
Allowance for credit losses (1,785) (1,949) (1,949) (1,597) (1,348)
Net loans and acceptances 146,156 149,596 144,765 142,447 144,783
*Amounts for 1999 include loan substitute securities classified as securities.
Net loans and acceptances decreased $3.4 billion to $146.2 bil-
lion. Loans to businesses and governments declined $6.1 billion,
reflecting weak demand. Related acceptances fell by $1.3 bil-
lion. Securities purchased under resale agreements fell by
$2.4 billion, reflecting market opportunities and foreign ex-
change rates. These decreases were partially offset by a $4.5 bil-
lion increase in residential mortgages, reflecting strong market
demand in the low interest rate environment. Credit cards
and consumer instalment and other personal loans increased
$1.6 billion in total, also reflecting healthy personal lending
markets. The portfolio remains well diversified, with a higher
proportion of Canadian loans due to the growth in residential
mortgages in Canada in 2003 and the impact of the weaker U.S.
dollar. The appreciation of the Canadian dollar, particularly in
relation to the U.S. dollar, reduced allowances for credit losses
related to foreign-currency-denominated loans by $119 million.
Table 10 on page 60 provides a comparative summary of loans
by geographic location and product. Table 12 on page 61 pro-
vides a comparative summary of net loans in Canada by province
and industry. Loan quality is discussed on page 24 and further
details on loans are provided in Notes 4, 5 and 7 to the financial
statements starting on page 76.
Financial Condition Review
Balance Sheet
112.9
117.5
121.9
127.0 127.3
20032002200120001999
Net Loans – Excluding
Securities Purchased under
Resale Agreements ($ billions)
Portfolio Diversification –
Gross Loans and Acceptances
Corporate 21%
Residential
mortgages 36%
Consumer 19%
Commercial 24%