Bank of Montreal (NYSE:BMO) Q4 2019 Earnings Conference Call - Final Transcript

Dec 03, 2019 • 08:00 am ET


Bank of Montreal (NYSE:BMO) Q4 2019 Earnings Conference Call - Final Transcript


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Please be advised that this conference call is being recorded. Good morning and welcome to the BMO Financial Group's Q4 2019 Earnings Release and Conference Call for December 3rd 2019.

Your host for today is Ms. Jill Homenuk, Head of Investor Relations. Ms. Homenuk, please go ahead.

Jill Homenuk

Thank you. Good morning and thanks for joining us today. Our agenda for today's investor presentation is as follows. We will begin the call with remarks from Darryl White, BMO's CEO, followed by presentations from Tom Flynn, the Bank's Chief Financial Officer; and Pat Cronin, our Chief Risk Officer. Darryl will then provide some outlook comments before we move on to the question-and-answer period.

We have with us today Cam Fowler from Canadian P&C and Dave Casper from US P&C. Dan Barclay is here for BMO Capital Markets and Joanna Rotenberg is here for BMO Wealth Management. During the question-and-answer period, we will take questions from pre-qualified analysts. To give everyone an opportunity to participate, please keep it to one question.

On behalf of those speaking today, I note that forward-looking statements may be made during this call. Actual results could differ materially from forecasts, projections or conclusions in these statements.

I would also remind listeners that the Bank uses non-GAAP financial measures to arrive at adjusted results to assess and measure performance by business and the overall Bank. Management assesses performance on a reported and adjusted basis and considers both to be useful in assessing underlying business performance. Darryl and Tom will be referring to adjusted results in their remarks, unless otherwise noted as reported. Additional information on adjusting items, the Bank's reported results and factors and assumptions related to forward-looking information can be found in our 2019 Annual Report and our Fourth Quarter 2019 Earnings Release.

With that said, I will hand things over to Darryl.

Darryl White

Thanks, Jill. Good morning everyone and thanks for joining us today. This morning, we announced earnings for the fourth quarter of CAD1.6 billion and earnings per share of CAD2.43, both up 5% from last year. We delivered bank-wide pre-provision pretax earnings growth of 11% in the quarter with positive operating leverage in every operating group. Earnings per share for the year of CAD9.43 were up 5%, reflecting good revenue and income growth across our North American platform.

2019 was a year of strong and consistent delivery across our businesses with significant progress made against our strategic priorities. Revenue grew 6%, PPPT earnings were up 7%, and expenses were well managed. As expected, expense growth in the second half of the year moderated significantly with expenses growing at just 2.6%. All of our businesses are working hard to achieve their priorities.

Canadian P&C ended the year with a particularly strong quarter with excellent loan and deposit growth in both our personal and commercial franchises. In commercial, we're maintaining a dominant position with a strategic focus having added targeted capacity that is driving incremental return. We're winning on value through expertise and understanding of our clients' needs without