Bank of Montreal 2004 Annual Report Download - page 40

BMO Financial Group Annual Report 200436
MD&A
Management’s Discussion and Analysis
Personal and Commercial Client Group – Canada
Group Description
Personal and Commercial Client Group (P&C), working together with BMO’s other
businesses, assists more than seven and a half million Canadians with their finan-
cial services needs. We offer a full range of products and services through almost
1,000 BMO Bank of Montreal traditional and instore branches, telephone banking, online
banking at bmo.com, and our network of 2,000 automated banking machines.
Our personal and commercial banking business is among the five largest in Canada,
operating in a business environment that is increasingly competitive, particularly
with the recent growth in the number of small players operating in niche segments.
Vision
Our goal is to be the only financial services provider our personal and commercial
customers will ever need. We will reach this goal by providing exceptional transactional
sales and service, and by delivering a buying experience that is proactive and
advice-based. Our comprehensive and customized products and services will help
our customers better manage all aspects of their financial affairs.
Strategies
•Continue to improve customer loyalty in both the personal and
commercial segments by proactively providing value-added products
and services to customers.
•Maintain market share in the increasingly competitive personal segment
by providing competitive products and pricing, enhanced distribution
capabilities and exceptional customer service.
•Be a leading provider of financial services to the commercial market-
place by providing a full suite of products and services tailored to
customer needs.
•Further improve the alignment and capability of sales and service
resources to better meet customers’ needs.
•Continue to simplify sales and fulfilment processes to improve our
customer experience, increase frontline capacity, and improve operational
and sales effectiveness.
Commercial Banking includes both business and commercial
mid-market clients. We provide our business clients – inde-
pendent businesses, small and medium-sized enterprises, and
lower mid-market banking clients – with a full range of banking
products and services. These include cash management, loans
and deposits provided through our branches and direct banking
channels. For our commercial mid-market clients, our special-
ized sales force delivers a full suite of integrated commercial
and capital markets products and financial advisory services.
Through Moneris Solutions, we provide merchants with credit
and debit card transaction processing services.
Challenges
•Customer alternatives are expanding due to a growing num-
ber of competitors and easier access to competitors’ products.
•Traditional competitors are refocusing their strategies
on personal and commercial banking.
•Pressure on margins is increasing due to heightened
price-based competition.
•Regulatory bodies are introducing new governance require-
ments that place greater demands on our resources.
Our Lines of Business
Personal Banking provides solutions for customers’ every-
day banking, financing, investing and insurance needs.
We serve more than 20% of Canadian households.
Our national, fully coordinated, multi-channel distribution
system offers customers convenience and choice in where,
when and how they do their banking. We offer a full array
of services at competitive prices and an exclusive Air Miles
rewards program.
Strengths
•Top-tier organizational effectiveness supported by our sales
and service delivery model, with competitive multi-channel
distribution capabilities.
•Solid customer data management capabilities and tailored
offerings, including strong referrals both within the group and
to Private Client Group and Investment Banking Group.
•Sound technology platform facilitating efficient sales and
service across all channels.
•Ability to adapt to a challenging competitive environment
through competitive pricing and continuous improvement
to our services.
•Strong employee engagement, with a large and effective sales
force and disciplined sales and service management processes.
•Superior risk management capabilities that utilize a consis-
tent approach in all economic conditions.
Key Performance Drivers (%) 2004 2003 2002
Deposit growth 9.1 8.1 21.4
Loan growth*7.0 6.7 7.6
Cash productivity ratio 60.1 61.0 62.3
Revenue growth 1.5 7.1 2.6
*Includes acceptances and securitized loans
Robert W. Pearce
President and Chief Executive Officer,
Personal and Commercial Client Group – Canada