Investor Presentation February 2024
Non-GAAP and Other Financial Measures8
Q1 23
(1) Reported net income in Q1-2023 included losses of $1,461 million
4,021 ($2,011 million pre-tax) related to the acquisition of Bank of the West,
1,078 comprising $1,628 million of mark-to-market losses on certain interest
rate swaps recorded in non-interest trading revenue and $383 million of
losses on a portfolio of primarily U.S. treasuries and other balance sheet
(217) instruments recorded in net interest income.
5,099
(4,382) (2) Reported net income included the impact of a lawsuit associated with
500 a predecessor bank, M&I Marshall and Ilsley Bank: Q1-2024 included
$11 million ($15 million pre-tax), comprising $14 million interest
(367)
expense and non-interest expense of $1 million; Q4-2023 included
133
$12 million ($16 million pre-tax), comprising interest expense of
0.14 $14 million and non-interest expense of $2 million; and Q1-2023
included $6 million ($8 million pre-tax), comprising interest expense of
$6 million and a non-interest expense of $2 million. These amounts were
recorded in Corporate Services. For further information, refer to the
Provisions and Contingent Liabilities section in Note 24 of the audited
annual consolidated financial statements of BMO's 2023 Annual Report.
(3) Reported net income in Q1-2023 included a one-time tax expense of
$371 million related to certain tax measures enacted by the Canadian
government, recorded in Corporate Services.
(6)
(2,025)
(4) Reported net income included acquisition and integration costs,
recorded in non-interest expense. Costs related to the acquisition of Bank
of the West were recorded in Corporate Services: Q1-2024 included
$46 million ($61 million pre-tax); Q4-2023 included $434 million
($583 million pre-tax); and Q3-2023 included $363 million ($487 million
pre-tax). Costs related to the acquisitions of Radicle and Clearpool were
recorded in BMO Capital Markets: Q1-2024 included $10 million
($14 million pre-tax); Q4-2023 included a recovery of $2 million
($3 million pre-tax); and Q3-2023 included $1 million ($2 million pre-
tax). Costs related to the acquisition of AIR MILES were recorded in
Canadian P&C: Q1-2024 included $1 million ($1 million pre-tax); Q4-2023
included $1 million ($2 million pre-tax); and Q3-2023 included $6 million
($8 million pre-tax).
(5) Reported net income included amortization of acquisition-related
intangible assets recorded in non-interest expense in the related
operating group: Q1-2024 included $84 million ($112 million pre-tax);
Q4-2023 included $88 million ($119 million pre-tax); and Q3-2023
included $85 million ($115 million pre-tax).
(2.92) (6) Reported net income in Q1-2024 included a net accounting loss on
4,410 the sale of a portfolio of recreational vehicle loans related to balance
sheet optimization of $136 million ($164 million pre-tax), recorded in
Corporate Services.
(7) Reported net income in Q1-2024 included the impact of a U.S. Federal
(217) Deposit Insurance Corporation (FDIC) special assessment of $313 million
(4,133) ($417 million pre-tax), recorded in non-interest expense in Corporate
2,766 Services.
(8) For more information, refer to slide 56 and the Non-GAAP and Other
Financial Measures section of BMO's First Quarter 2024 MD&A
Reported
(Canadian $ in millions, except as noted)
Net interest income
Non-interest revenue
Revenue
Provision for credit losses
Non-interest expense
Q1 24
Q4 23
4,721
4,941
2,951
3,378
7,672
8,319
(627)
(446)
(5,389)
(5,679)
Results
Income before income taxes
1,656
2,194
Provision for income taxes
(364)
(484)
Net income
1,292
1,710
Diluted EPS ($)
1.73
2.19
Management of fair value changes on the purchase of Bank of the West (1)
(2,011)
Legal provision (recorded in revenue) (2)
(14)
(14)
Impact of loan portfolio sale (6)
(164)
Impact of adjusting items on revenue (pre-tax)
(178)
(14)
Adjusting
Acquisition and integration costs (4)
(76)
(582)
(2,017)
(239)
Items
(Pre-tax)
Amortization of acquisition-related intangible assets (5)
(112)
(119)
(8)
Legal provision (including legal fees) (2)
(1)
(2)
(2)
FDIC special assessment (7)
(417)
Impact of adjusting items on non-interest expense (pre-tax)
(606)
(703)
Impact of adjusting items on reported net income (pre-tax)
(784)
(717)
(249)
(2,266)
Management of fair value changes on the purchase of Bank of the West (1)
(1,461)
Legal provision (including related interest expense and legal fees) (2)
(10)
(10)
(5)
Impact of loan portfolio sale (6)
(136)
Impact of adjusting items on revenue (after-tax)
(10)
(10)
(5)
Acquisition and integration costs (4)
(57)
(433)
(181)
Adjusting
Amortization of acquisition-related intangible assets (5)
(84)
(88)
(6)
Items
(After-tax)
Legal provision (including related interest expense and legal fees) (2)
(1)
(2)
(1)
FDIC special assessment (7)
(313)
Impact of adjusting items on non-interest expense (after-tax)
(455)
(523)
(188)
Impact of Canadian tax measures (3)
(371)
Impact of adjusting items on reported net income (after-tax)
(601)
(533)
Impact on diluted EPS ($)
Net interest income
(0.83)
(0.75)
4,735
4,955
Non-interest revenue
3,115
3,378
2,706
Adjusted
Results
Net income
Revenue
Provision for credit losses
Non-interest expense
Income before income taxes
Provision for income taxes
Diluted EPS ($)
7,850
8,333
7,116
(627)
(446)
(4,783)
(4,976)
2,440
2,911
(547)
(668)
(608)
1,893
2,243
2,158
2.56
2.93
3.06
Prior period amounts have been reclassified to conform with the current period presentation, including the retrospective application of IFRS 17
BMO
Investor Presentation ⚫ February 2024
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