Bank of Montreal 2015 Annual Report Download - page 110

Supplemental Information
Table 4: Non-Interest Expense and Expense-to-Revenue Ratio
($ millions, except as noted)
For the year ended October 31 2015 2014 2013 2012 2011
5-year
CAGR
10-year
CAGR
Non-Interest Expense
Employee compensation
Salaries 3,910 3,388 3,259 3,148 2,646 11.3 7.5
Performance-based compensation 2,102 1,946 1,686 1,657 1,560 7.6 5.1
Employee benefits 1,069 908 897 808 621 11.4 6.5
Total employee compensation 7,081 6,242 5,842 5,613 4,827 10.2 6.6
Premises and equipment
Rental of real estate 462 415 416 400 360 7.7 8.9
Premises, furniture and fixtures 287 261 377 368 310 1.3 1.2
Property taxes 39 39 37 36 30 6.5 (1.5)
Computers and equipment (1) 1,349 1,193 1,003 1,071 878 13.2 5.8
Total premises and equipment (1) 2,137 1,908 1,833 1,875 1,578 9.7 nm
Other expenses
Amortization of intangible assets (1) 411 382 346 331 231 15.2 nm
Communications 314 289 291 301 259 6.5 10.0
Business and capital taxes 45 39 39 46 51 (3.1) (8.4)
Professional fees 595 622 527 593 624 8.2 9.4
Travel and business development 605 542 514 491 382 12.1 9.4
Other 994 897 834 885 789 7.8 7.0
Total other expenses 2,964 2,771 2,551 2,647 2,336 9.2 8.4
Total Non-Interest Expense 12,182 10,921 10,226 10,135 8,741 9.8 6.8
Year-over-year total non-interest expense growth (%) 11.5 6.8 0.9 15.9 14.7 na na
Total Adjusted Non-Interest Expense 11,819 10,761 9,755 9,410 8,453 9.3 6.6
Year-over-year total adjusted non-interest expense growth (%) 9.8 10.3 3.7 11.3 11.5 na na
Non-interest expense-to-revenue ratio (Efficiency ratio) (%) 62.8 59.9 60.8 59.3 58.0 na na
Adjusted non-interest expense-to-revenue ratio (Efficiency ratio) (%) 60.9 59.1 60.4 58.7 56.9 na na
Efficiency ratio, net of CCPB (2) 67.2 65.3 63.7 63.6 62.7 na na
Adjusted efficiency ratio, net of CCPB (2) 65.2 64.4 63.5 63.3 61.5 na na
Government Levies and Taxes (3)
Government levies other than income taxes
Payroll levies 312 252 249 250 203 12.3 7.5
Property taxes 39 39 37 36 30 6.5 (1.5)
Provincial capital taxes 33 27 30 37 44 (6.1) (10.5)
Business taxes 10 97977.4 3.3
Harmonized sales tax, GST and other sales taxes 319 273 262 249 235 16.9 9.7
Sundry taxes 22121
nm nm
Total government levies other than income taxes 715 602 586 583 520 12.2 5.2
Provision for income taxes 936 903 1,055 874 876 nm 0.7
Total Government Levies and Taxes 1,651 1,505 1,641 1,457 1,396 8.7 2.4
Total government levies and taxes as a % of income available to pay
government levies and taxes 23.1 25.0 28.7 26.6 31.0 na na
Effective income tax rate (%) 17.5 17.2 20.1 17.4 22.0 na na
Adjusted effective income tax rate (%) 18.0 17.5 19.7 18.6 21.7 na na
Five-year and ten-year CAGR based on CGAAP in 2010 and 2005, respectively, and on IFRS in 2015. 2011 growth rates based on CGAAP in 2010 and IFRS in 2011.
2011 has not been restated to reflect the new IFRS standards adopted in 2014. The adoption of new IFRS standards in 2015 only impacted our results prospectively.
(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, but not for years prior to 2007. As such, 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 6.5% over ten years. Together, total premises and equipment expense and the
amortization of intangible assets increased at a compound annual growth rate of 7.4% over ten years.
(2) This ratio is calculated excluding insurance claims, commissions and changes in policy benefit liabilities (CCPB).
(3) Government levies are included in various non-interest expense categories.
na – not applicable
nm – not meaningful
BMO Financial Group 198th Annual Report 2015 121