TORONTO (Reuters) - Bank of Montreal (BMO.TO) on Wednesday reported second quarter results which were ahead of market expectations, helped by strong performances at its retail and wealth management businesses in Canada and the United States.
The results mean that all of Canada’s biggest five banks have reported earnings which were ahead of expectations during the latest quarter. The banks have benefited from improved profit margins as a result of the Bank of Canada raising interest rates three times since July, offsetting slower mortgage growth after Canada’s banking regulator introduced stricter lending rules in January.
Canada’s fourth biggest lender said earnings per share, excluding exceptional items, rose by 15 percent to C$2.20 in the quarter to March 31. Analysts had on average forecast earnings of C$2.12 per share, according to Thomson Reuters I/B/E/S data.
Bank of Montreal’s net income, excluding one-off items, rose 13 percent to C$1.5 billion ($1.15 billion).
The bank said net income, excluding one-off items, at its Canadian retail business increased by 11 percent to C$591 million and net income, excluding one-off items, at its U.S. retail business increased by 43 percent to C$359 million.
Net income at the bank’s investment banking business fell by 8 percent to C$286 million.
Bank of Montreal said it took a charge of C$192 million during the period, primarily relating to severance pay resulting from job cuts which are part of a drive by new Chief Executive Darryl White to improve efficiency at the bank.
White said in April that he wanted a “lighter structure” at the bank.
National Bank of Canada (NA.TO), Canada’s sixth biggest lender, on Wednesday reported earnings per share of C$1.44 in the second quarter, up 13 percent on the year before.
Reporting by Matt Scuffham; editing by David Evans