UPDATE 1-BMO sees US opportunites but plays it cautious

* BMO CEO says bank to take advantage of distracted rivals

* Says Harris Bank ready for acquisitions, organic growth

* Says excess capital will weigh on ROE

TORONTO, Feb 3 (Reuters) - Bank of Montreal (BMO.TO) plans to increase its U.S. market share by expanding its existing businesses and making acquisitions, but it will proceed carefully while the global regulatory environment remains uncertain, its chief executive said on Wednesday.

BMO, North America's ninth-largest bank, plans to use its strong balance sheet to build up Harris Bank, CEO Bill Downe said at a Morgan Stanley conference in New York.

Harris Bank is a Chicago-based subsidiary that provides financing, investing and cash management services.

"The competitive dynamic is shifting as a result of a number of regulator initiated consolidations, and as a result, we have an opportunity to increase Harris's size and momentum in the market," he said.

"We intend to leverage our established platform to take advantage of a market where many traditional competitors are sidelined or distracted."

BMO's Tier 1 capital ratio was 12.24 percent in fiscal 2009, in line with Canadian peers and well above that of most global rivals. The cash gives the bank the flexibility to invest or make acquisitions, but impending changes in global regulatory requirements have made executives cautious about depleting their capital stockpiles.

"Until there is regulatory certainty with respect to global capital standards, excess capital will weigh on our ROE (return on equity)," said Downe.

"That said, we wouldn't apologize for building levels of capital that we consider prudent, given the uncertainty of the markets in the past couple of years." (Reporting by Andrea Hopkins and John McCrank)