Bank of Montreal 2007 Annual Report Download - page 92

Supplemental Information
Supplemental Information
88 BMO Financial Group 190th Annual Report 2007
Table 20 • Capital Adequacy ($ millions, except as noted)
As at October 31 2007 2006 2005 2004 2003
Tier 1 capital
Common shareholders’ equity 14,233 14,465 13,246 12,120 11,036
Non-cumulative preferred shares (1) 1,446 1,046 1,046 1,046 1,446
Innovative Tier 1 capital instruments (1) (2) 2,422 2,192 2,192 1,745 1,150
Non-controlling interest in subsidiaries 33 36 37 44 39
Goodwill and excess intangible assets (3) (1,140) (1,098) (1,091) (1,507) (1,334)
Total Tier 1 capital 16,994 16,641 15,430 13,448 12,337
Tier 2 capital
Preferred shares of a subsidiary (2)
– 273 287 296 320
Subordinated debt 3,335 2,306 2,130 1,783 1,981
Trust subordinated notes 800 ––––
Accumulated unrealized gain from Available-For-Sale Equity Securities 26 ––––
General allowance for credit losses (4) 898 905 958 1,010 1,130
Total Tier 2 capital 5,059 3,484 3,375 3,089 3,431
First loss protection (85) (44) (123) (128) (149)
Investment in non-consolidated subsidiaries/substantial investments (994) (937) (963) (901) –
Total capital 20,974 19,144 17,719 15,508 15,619
Risk-weighted assets 178,687 162,794 149,855 136,661 129,163
Capital ratios (%)
Tier 1 Capital Ratio 9.51 10.22 10.30 9.84 9.55
Total Capital Ratio 11.74 11.76 11.82 11.35 12.09
Assets-to-capital multiple 17.2 16.1 16.3 16.8 16.4
Table 21 • Risk-Weighted Assets ($ millions, except as noted)
As at October 31 2007 2006
Credit Risk Risk- Risk-
risk weighting weighted weighted
Balance equivalent (%) balance balance
Balance sheet items
Cash resources 22,890 22,890 0
– 20 4,324 3,747
Securities 98,277 98,277 0
– 100 5,236 4,324
Mortgages 58,372 58,372 0
– 100 16,652 25,625
Other loans and acceptances 142,816 142,816 0
– 100 96,661 84,299
Other assets 44,169 44,169 0 – 100 7,706 6,986
Total balance sheet items 366,524 366,524 130,579 124,981
Off-balance sheet items
Guarantees and standby letters of credit 12,395 10,663 0
– 100 7,270 7,542
Securities lending 1,834 298 0
– 100 59 21
Documentary and commercial letters of credit 1,301 260 0
– 100 116 207
Commitments to extend credit:
Original maturity of one year and under 66,126 3,531 0
– 100 3,531 –
Original maturity of over one year 28,372 14,186 0 – 100 13,066 13,543
Derivative financial instruments 2,694,284 32,592 0 – 50 8,913 7,542
Total off-balance sheet items 2,804,312 61,530 32,955 28,855
Total risk-weighted assets –credit risk 163,534 153,836
Total risk-weighted assets –market risk 15,153 8,958
Total risk-weighted assets 178,687 162,794
(1) Non-cumulative preferred shares and Innovative Tier 1 capital instruments include amounts
that were reclassified to liabilities on the consolidated balance sheet, but are eligible for
inclusion in the capital calculation for regulatory purposes.
(2) In the fourth quarter of 2007, OSFI approved the reclassification of preferred shares issued by
a subsidiary from Tier 2 capital to Innovative Tier 1 capital under a new OSFI Advisory
released in the third quarter of 2007.
(3) In addition to goodwill, intangible assets in excess of 5% of gross Tier 1 capital are deducted
from Tier 1 capital as required by OSFI guidelines.
(4) OSFI permits the inclusion of the lesser of the balance of our general allowance for credit losses
and 0.875% of risk-weighted assets.