Bank of Montreal 2008 Annual Report Download - page 59

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MD&A
BMO Financial Group 191st Annual Report 2008 | 55
BMO Capital Markets (BMO CM)
“We excel at using our
knowledge, skills and ideas
to clarify financial matters
and develop and deliver
solutions that help our clients
realize their ambitions.”
Who We Are
BMO Capital Markets combines all of our businesses serving a broad range of corporate, institutional and government clients
domestically and internationally. We serve clients from our offices in Canada, the United States, the United Kingdom, Europe,
Australia, Asia and South America. We offer complete financial solutions, drawing upon our expertise in areas including
equity and debt underwriting, corporate lending and project financing, mergers and acquisitions (M&A) advisory services,
merchant banking, securitization, treasury and market risk management, foreign exchange, derivatives, debt and equity
research and institutional sales and trading.
TOM MILROY
CHIEF EXECUTIVE OFFICER
BMO CAPITAL MARKETS
Investment and Corporate Banking services include strategic advice
on mergers and acquisitions, restructurings and recapitalizations, as well
as providing valuation and fairness opinions. We provide capital-raising services
through debt and equity underwriting. We also provide a full range of loan
and debt products, balance sheet management solutions and treasury manage-
ment services. In support of our clients’ international business activities,
we provide trade finance and risk mitigation services. We also offer a wide
range of banking and other operating services to international and domestic
financial institutions.
Trading Products services include sales, trading and research activities.
We provide integrated debt, foreign exchange, interest rate, credit, equity,
securitization and commodities solutions to wholesale, commercial and
retail clients. In addition, we provide efficient funding and liquidity management
to BMO Financial Group and its clients, as well as new product development,
proprietary trading and origination.
Strengths and Value Drivers
•Well-established franchise with a leadership position in certain
industries and products and a reputation for quality advice.
•Top-tier equity research, sales and trading capabilities.
•Significant investment and corporate banking presence in the
U.S. Midwest.
•Cross-border capabilities with the ability to leverage North
American expertise.
Challenges
•Continuation of the volatility and distress in the global credit markets.
•Slowing of the global economy due to a recession and the
uncertainty of the financial system restructuring.
•Mature and competitive Canadian financial markets.
•Highly competitive landscape of the U.S. and international markets.
Our Major Lines of Business
To be the investment and corporate bank that defines
great customer experience by enabling our clients
to fulfill their ambitions.
VISION
PATH TO DIFFERENTIATION
•Increase focus on core clients by emphasizing our areas of strength
in niche North American and global markets.
•Maintain a diversified, dynamic portfolio of businesses that serves
the evolving needs of our core clients.
•Better serve clients by creating a more focused and integrated
North American capital markets business.
•Continue to optimize our businesses to generate appropriate
risk-adjusted returns.
•Build strong risk management capabilities through solid partnerships
and enhanced risk transparency.
STRATEGIES
•Ability to serve a broad range of core Canadian issuer and investor client
needs with an integrated capital markets offering.
•Successful, stable and trustworthy universal North American banking model.
•Ability to serve U.S. mid-market clients with an integrated offer, given
the restructuring of the U.S. financial market.
•Ability to leverage capabilities to be a leading competitor in niche markets
in North America and globally.
•Nimble and responsive execution, with an ability to react quickly to evolving
market and client needs.
Key Performance Metrics and Drivers 2008 2007 2006
Trading products revenue ($ millions) 993 281 1,370
Equity block trading dollar value ($ billions) 118 116 92
Investment and Corporate Banking
and other revenue ($ millions) 1,419 1,688 1,410
Equity underwriting participation (deals) (1) 140 276 267
Debt underwriting participation (deals) (1) 121 110 143
Average loans and acceptances ($ billions) 85.0 69.6 55.0
Canadian equity research ranking (2) #1 #1 #1
(1) Canadian issuers in North America.
(2) Brendan Wood International survey.