Bank of Montreal 2010 Annual Report Download - page 101

Supplemental Information
BMO Financial Group 193rd Annual Report 2010 99
Table 8: Non-Interest Expense and Expense-to-Revenue Ratio ($ millions, except as noted)
5-year 10-year
For the year ended October 31 2010 2009 2008 2007 2006 CAGR CAGR
Non-Interest Expense
Employee compensation
Salaries
2,285 2,395 2,149 1,964 1,903 3.7 2.4
Performance-based compensation 1,455 1,338 1,297 1,275 1,322 2.7 3.9
Employee benefits 624 652 530 586 599 1.8 8.9
Total employee compensation 4,364 4,385 3,976 3,825 3,824 3.1 3.6
Premises and equipment
Rental of real estate 319 306 279 257 246 10.1 9.4
Premises, furniture and fixtures 269 272 255 242 230 1.2 (0.1)
Property taxes 28 30 29 28 26 (8.8) (5.0)
Computers and equipment 727 673 678 634 709 (1)
Total premises and equipment 1,343 1,281 1,241 1,161 1,211 (1)
Other expenses
Communications
229 221 202 149 131 13.5 (1.2)
Business and capital taxes 52 44 42 47 94 (13.5) (7.3)
Professional fees 372 362 384 301 287 8.9 1.1
Travel and business development 343 309 328 287 253 6.8 3.8
Other 684 586 546 484 509 6.3 13.0
Total other expenses 1,680 1,522 1,502 1,268 1,274 6.6 3.9
Amortization of intangible assets 203 203 183 188 44 (1)
Restructuring charge (reversal) – (10) (8) 159 – nm nm
Total Non-Interest Expense 7,590 7,381 6,894 6,601 6,353 3.7 3.7
Year-over-year growth (%) 2.8 7.1 4.4 3.9 0.3 na na
Non-interest expense-to-revenue ratio (Productivity ratio) (%) 62.2 66.7 67.6 70.6 63.6 na na
Government Levies and Taxes (2)
Government levies other than income taxes
Payroll levies
175 171 164 165 162 2.9 2.8
Property taxes 28 30 29 28 26 (8.8) (5.0)
Provincial capital taxes 45 35 32 37 86 (14.8) (7.7)
Business taxes 7 9 10 10 8 (0.6) (3.9)
Harmonized sales tax, GST and other sales taxes (3) 146 116 142 122 128 2.9 1.6
Sundry taxes 1 3 3 3 2 nm nm
Total government levies other than income taxes 402 364 380 365 412 (1.4) (0.3)
Provision for (recovery of) income taxes 687 217 (71) 189 717 (4.7) (3.6)
Total Government Levies and Taxes 1,089 581 309 554 1,129 (3.6) (2.5)
Total government levies and taxes as a % of income
available to pay government levies and taxes 27.4 23.8 13.1 20.1 29.2 na na
Effective income tax rate 19.2 10.5 (3.6) 7.9 20.7 na na
(1) In 2009, we adopted new accounting requirements for intangible assets and reclassified
certain computer equipment from premises and equipment to intangible assets.
Computer and equipment expense and the amortization of intangible assets were restated
for 2007 and 2008. As such, five-year and ten-year growth rates for these expense categories
are not meaningful. Together, computer and equipment expense and the amortization of
intangible assets increased at a compound annual growth rate of 1.5% over five years and
3.7% over ten years. Together, total premises and equipment expense and the amortization
of intangible assets increased at a compound annual growth rate of 2.6% over five years
and 3.5% over ten years.
(2) Government levies are included in various non-interest expense categories.
(3) On July 1, 2010, the harmonized sales tax was implemented in both Ontario and British
Columbia. This has increased the sales tax paid in these two jurisdictions.
na – not applicable
nm – not meaningful