Bank of Montreal 2008 Annual Report Download - page 92

MANAGEMENT’S DISCUSSION AND ANALYSIS
MD&A
88 | BMO Financial Group 191st Annual Report 2008
Summarized Statement of Income and Quarterly Financial Measures
Oct. 31 July 31 April 30 Jan. 31 Oct. 31 July 31 April 30 Jan. 31
($ millions) 2008 2008 2008 2008 2007 2007 2007 2007 2008 2007 2006
Net interest income 1,413 1,286 1,174 1,214 1,196 1,247 1,204 1,196 5,087 4,843 4,744
Non-interest revenue 1,400 1,460 1,446 812 1,004 1,308 1,324 870 5,118 4,506 5,241
Total revenue 2,813 2,746 2,620 2,026 2,200 2,555 2,528 2,066 10,205 9,349 9,985
Provision for credit losses –specific 315 434 151 170 101 91 59 52 1,070 303 211
Provision for credit losses –general 150 50 – 60 50–––260 50 (35)
Non-interest expense 1,826 1,782 1,680 1,614 1,631 1,659 1,614 1,538 6,902 6,442 6,353
Restructuring charge (reversal) (8)–––24 – – 135 (8) 159 –
Income before provision for income taxes and
non-controlling interest in subsidiaries 530 480 789 182 394 805 855 341 1,981 2,395 3,456
Provision for income taxes (49) (59) 128 (91) (77) 127 165 (26) (71) 189 717
Non-controlling interest in subsidiaries 19 18 19 18 19 18 19 19 74 75 76
Net income 560 521 642 255 452 660 671 348 1,978 2,131 2,663
Amortization of intangible assets,
net of income taxes 1098891010 935 38 36
Cash net income 570 530 650 263 461 670 681 357 2,013 2,169 2,699
Operating group net income:
Personal and Commercial Banking 356 371 361 328 320 381 356 326 1,416 1,383 1,277
Private Client Group 78 110 109 98 103 102 99 91 395 395 341
BMO Capital Markets 285 259 182 (34) 46 194 197 (20) 692 417 852
Corporate Services, including T&O (159) (219) (10) (137) (17) (17) 19 (49) (525) (64) 193
BMO Financial Group net income 560 521 642 255 452 660 671 348 1,978 2,131 2,663
Information per Common Share ($)
Dividends declared 0.70 0.70 0.70 0.70 0.70 0.68 0.68 0.65 2.80 2.71 2.26
Earnings
Basic 1.06 1.00 1.25 0.48 0.89 1.30 1.31 0.68 3.79 4.18 5.25
Diluted 1.06 0.98 1.25 0.47 0.87 1.28 1.29 0.67 3.76 4.11 5.15
Cash earnings
Basic 1.08 1.01 1.27 0.50 0.90 1.32 1.33 0.70 3.86 4.25 5.33
Diluted 1.08 1.00 1.26 0.49 0.89 1.30 1.31 0.68 3.83 4.18 5.23
Book value 32.02 30.15 29.71 28.64 28.29 28.81 28.95 28.90 32.02 28.29 28.89
Market price
High 51.74 52.31 58.78 63.44 67.17 71.35 72.75 72.22 63.44 72.75 70.24
Low 35.65 37.60 38.00 51.35 60.21 66.59 68.29 67.75 35.65 60.21 56.86
Close 43.02 47.94 50.10 56.75 63.00 66.59 69.46 70.01 43.02 63.00 69.45
Financial Measures (%)
Five-year average annual total shareholder return 0.9 5.1 8.2 10.1 14.2 17.2 16.6 17.8 0.9 14.2 19.1
Dividend yield 6.5 5.8 5.6 4.9 4.4 4.1 3.9 3.7 6.5 4.3 3.3
Diluted earnings per share growth 21.8 (23.4) (3.1) (29.9) (35.6) (7.2) 3.2 (42.7) (8.5) (20.2) 11.2
Diluted cash earnings per share growth 21.3 (23.1) (3.8) (27.9) (35.0) (7.1) 3.1 (42.9) (8.4) (20.1) 9.4
Return on equity 14.0 13.5 17.9 6.7 12.2 18.0 18.3 9.2 13.0 14.4 19.2
Cash return on equity 14.3 13.7 18.1 6.9 12.5 18.2 18.5 9.5 13.3 14.7 19.5
Net economic profit growth 103.4 (56.5) (7.9) (242.7) (78.1) (19.8) (4.2) (114.6) (32.8) (51.0) 10.3
Net income growth 23.9 (21.1) (4.3) (26.8) (35.0) (7.1) 3.1 (42.5) (7.2) (20.0) 11.2
Revenue growth 27.9 7.5 3.6 (2.0) (10.6) (0.6) 2.3 (16.7) 9.2 (6.4) 1.5
Net interest margin 1.71 1.59 1.48 1.45 1.47 1.61 1.65 1.64 1.56 1.59 1.81
Productivity ratio 64.6 64.9 64.1 79.7 75.2 64.9 63.8 81.0 67.6 70.6 63.6
Provision for credit losses as a % of average
net loans and acceptances 0.81 0.89 0.28 0.42 0.29 0.18 0.12 0.10 0.60 0.17 0.09
Effective tax rate (9.2) (12.2) 16.3 (50.3) (19.3) 15.7 19.4 (7.8) (3.6) 7.9 20.7
Canadian/U.S. dollar average exchange rate ($) 1.111 1.012 1.007 0.998 0.999 1.067 1.144 1.162 1.032 1.093 1.132
Gross impaired loans and acceptances as a %
of equity and allowance for credit losses 11.34 9.09 9.54 7.46 4.07 3.49 3.86 4.19 11.34 4.07 3.81
Cash and securities-to-total assets 29.1 29.6 29.6 30.7 33.1 31.0 28.6 28.4 29.1 33.1 27.2
Tier 1 Capital Ratio (1) 9.77 9.90 9.42 9.48 9.51 9.29 9.67 9.76 9.77 9.51 10.22
(1) A new framework, Basel II, was adopted in 2008. Basel II and Basel I methodologies are not comparable.
In the opinion of BMO’s management, information that is derived from unaudited financial information, including information as at and for interim periods, includes all adjustments
necessary for a fair presentation of such information. All such adjustments are of a normal and recurring nature. Financial ratios for interim periods are stated on an annualized basis where
appropriate, and all growth rates represent year-over-year growth. Ratios, as well as interim operating results, are not necessarily indicative of actual results for the full fiscal year.