BMO investment bank looks to build European sales

Thu Oct 15, 2009 2:07pm EDT

* Opens Paris office with sales team ex-UBS

* Hopes commodities sales opens door to broader equities

By Andrea Hopkins

TORONTO, Oct 15 (Reuters) - As global rivals retrench, the investment banking arm of Bank of Montreal (BMO.TO) is pushing further into Europe, hoping Canada's commodities cachet will lure institutional investors into BMO's equities sales net.

Boasting a sales team recently snatched from troubled Swiss bank UBS (UBSN.VX), Canada's fourth-largest bank opened a capital markets office in Paris this week in a bid to get a foot in the door with investors looking to diversify their holdings of mining and energy companies.

Like its domestic rivals, Bank of Montreal has emerged from the financial crisis relatively unscathed and eager to snap up market share in Europe and the United States while global rivals are regrouping.

"We don't like to talk specifically about our competitors but the fact that we're opening up the Paris branch is indicative of (our relative strength)," Eric Tripp, president of BMO Capital Markets, said in an interview on Thursday.

The Paris office is BMO's 27th global office and the latest notch in the bank's strategy to broaden its institutional equity sales and trading services for global clients.

While the bank has capital markets expertise in North America beyond commodities, Tripp said leveraging Canada's reputation as the country of mines and oilfields -- and BMO as a bank that has long covered those industries -- is a way of getting the bank front-and-center with investors who might not otherwise look to Canadian brokerages for advice.

Then, once they build trust and relationships, BMO hopes to expand sales beyond hard commodities.

"We have a knowledge base of the Canadian market that is very strong relative to the global investment banks that we might compete with in Europe for the minds of the institutional investors," Tripp said.

"They'll give us the time to discuss things because they know we're the experts on the market, versus if JPMorgan shows up to talk about Canadian companies. A European investor is less likely to listen to them than they would to us, because they know that's our focus. That's the sweet spot of our business."

But the opening of the Paris bureau -- BMO's fourth European office after London, Zurich and Lugano -- does not herald an imminent move to buy up bank assets from rivals looking to trim their capital markets business.

BMO has consistently said it is focusing its acquisition strategies on assets that fit its Canadian and U.S. Midwest geographic footprint -- not European banks.

"That would not be our strategy at this time," Tripp said. "The assets for us are people, and then just expanding our market share with the clients through the team that we have."

The Paris bureau will be run by Matthieu Debost and a six equity salesmen, all of whom came over from UBS in recent months. Debost spent 19 years at UBS, where he was head of Canadian equity sales in Europe since 2002, BMO said. (Reporting by Andrea Hopkins; editing by Janet Guttsman)

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