Shares of Bank of Montreal (BMO – Free Report) jumped 4.4% on the NYSE in response to the release of its first quarter fiscal 2025 (ended Jan. 31) results. Adjusted earnings per share of C$3.04 grew 18.8% year over year.
Find the latest earnings estimates and surprises on the Zacks Earnings Calendar.
Results benefited from higher revenues and a solid growth in loans and deposit balance. However, a significant jump in provision for credit losses and higher non-interest expenses acted as headwinds.
After considering non-recurring items, net income was C$2.13 billion ($1.5 billion), which surged 65.5% from the year-ago quarter.
BMO’s Revenues Rise, Expenses Up
Total revenues (on an adjusted basis), net of insurance claims, commissions and changes in policy benefit liabilities (CCPB), were C$9.27 billion ($6.52 billion), up 18% year over year.
NII rose 14% year over year to C$5.4 billion ($3.8 billion). Also, non-interest income came in at C$3.87 billion ($2.72 billion), up 24.2%.
Adjusted non-interest expenses increased 9.2% to C$5.22 billion ($3.67 billion).
The adjusted efficiency ratio (net of CCPB) was 56.3%, down from 60.9% as of Jan. 31, 2024.
Provision for credit losses (adjusted) was C$1.01 billion ($0.7 billion) in the reported quarter, surging 61.2% from the year-ago quarter.
Loans & Deposits Rise for Bank of Montreal
As of Jan. 31, 2025, total assets were C$1.47 trillion ($1 trillion), up 4.1% from the prior-quarter end.
Total net loans grew 1.6% sequentially to C$688.7 billion ($475.4 billion). Total deposits increased 1.5% to C$996.8 billion ($688 billion).
BMO’s Profitability Ratios & Capital Ratios Improve
Bank of Montreal’s return on common equity (as adjusted) was 11.3% in the fiscal first quarter compared with 10.6% on Jan. 31, 2024. Adjusted return on tangible common equity was 14.9% compared with 14.3% in the year-ago quarter.
As of Jan. 31, 2025, the Common Equity Tier-I ratio was 13.6%, up from 12.8% a year ago. The Tier-I capital ratio was 15.4% compared with the previous year’s 14.4%.
Our Take on Bank of Montreal
Bank of Montreal’s focus and efforts align with its organic and business restructuring strategies and are anticipated to support revenues in the upcoming period. However, elevated expenses and an uncertain macroeconomic backdrop stemming from tariffs are headwinds.
Bank Of Montreal Price, Consensus and EPS Surprise
Bank Of Montreal price-consensus-eps-surprise-chart | Bank Of Montreal Quote
Currently, BMO carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Release Dates of BMO’s Peers
Toronto-Dominion Bank (TD – Free Report) and Canadian Imperial Bank of Commerce (CM – Free Report) are slated to report first-quarter fiscal 2025 results on Feb. 27.
At present, CM carries a Zacks Rank #3, while TD has a Zacks Rank of 4 (Sell).
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