Bank of Montreal (TSX:BMO) on Thursday reported fourth-quarter earnings that surpassed analysts’ expectations, driven by stronger-than-anticipated results in its US operations and broad-based growth across its business segments.
The Canadian lender posted adjusted earnings per share of C$3.28, up 73% from the prior year, while revenue rose 12% to C$9.34 billion.
Adjusted net income for the quarter grew to C$2.51 billion, compared with C$1.54 billion a year earlier. The bank’s provision for credit losses fell by half to C$755 million, helping to support the sharp rise in profits.
Return on equity (ROE) improved to 11.8% from 7.4% in the previous year, while the efficiency ratio edged lower to 56.7%, indicating improved operational performance.
BMO also declared a quarterly dividend of C$1.67 per share, up 2% from the previous quarter and 5% from a year ago.
Management reiterated its medium-term financial objectives, noting adjusted EPS growth of 26% for fiscal 2025. above its 7% to 10% target, while ROE remained below the 15%+ medium-term goal.
Operating leverage also outperformed expectations, delivering 4.3% adjusted positive leverage versus a 2% target.
Despite the strong results, shares of BMO slipped 1.6% in Toronto trading, reflecting investor caution following broader credit concerns in the sector.