BMO's first quarter profit climbs 7 per cent to $1.07 billion

The bank grew revenue in its personal and commercial banking segments on both sides of the border

TORONTO – The Bank of Montreal saw its first-quarter profit rise seven per cent to $1.07 billion as it grew revenue in its personal and commercial banking segments on both sides of the border.

That’s compared to net income of $1 billion during the same quarter last year.

The earnings amounted to $1.58 per common share, an increase of eight per cent from the $1.46 per share that BMO reported a year ago.

On an adjusted basis, the bank earned $1.18 billion, or $1.75 per share, up from $1.04 billion, or $1.53 per share, during the same quarter last year.

Its revenue amounted to $5.08 billion for the quarter ended Jan. 31, up from $5.06 billion a year ago.

Provisions for credit losses rose to $183 million, compared with $163 million during the same quarter last year.

Loans to oil-and-gas companies that are unlikely to be repaid in full rose to $162 million during the quarter _ an increase of nearly 60 per cent from the previous quarter.

Barclays analyst John Aiken says that despite the increase, impaired loans to the energy sector were still modest, representing only 2.2 per cent of the bank’s oil and gas loans.

“While weakness continues to permeate through BMO’s energy portfolio, it is still not showing any cracks,” Aiken said in a note to clients.

BMO’s Canadian personal and commercial banking business saw its profits climb by five per cent from a year ago to $529 million.

South of the border, the bank’s personal and commercial banking division increased its net income by 31 per cent to $251 million, boosted by the purchase of General Electric Co.’s transportation-finance business.

Meanwhile, weak market conditions caused net income at BMO’s wealth management division to slip roughly seven per cent to $148 million, from $159 million a year ago.

“Our results this quarter reinforce our confidence that successfully executing on our strategy will enable us to meet customers’ changing expectations and continue to perform well in an unsettled environment,” BMO’s chief executive Bill Downe said in a statement.