BMO Financial Group Reports Fourth Quarter and Fiscal 2025 Results

Fourth Quarter 2025 Earnings Release

BMO's 2025 audited annual consolidated financial statements and accompanying Management Discussion and Analysis (MD&A) are available online at  www.bmo.com/investorrelations and at www.sedarplus.ca.

Financial Results Highlights

Fourth Quarter 2025 compared with Fourth Quarter 2024:

• Reported net income¹ of $2,295 million, compared with $2,304 million; adjusted net income¹ of $2,514 million, an increase of 63% from $1,542 million
• Reported earnings per share (EPS)² of $2.97, an increase of 1% from $2.94; adjusted EPS^{1, 2} of $3.28, an increase of 73% from $1.90
• Provision for credit losses (PCL) of $755 million, compared with $1,523 million
• Reported return on equity (ROE) of 10.7%, compared with 11.4%; adjusted ROE¹ of 11.8%, compared with 7.4%
• Common Equity Tier 1 (CET1) Ratio³ of 13.3%, compared with 13.6%
• Declared a quarterly dividend of $1.67 per common share, an increase of $0.04 or 2% from the prior quarter, and an increase of $0.08 or 5% from the prior year

Fiscal 2025 compared with Fiscal 2024:

• Reported net income¹ of $8,725 million, an increase of 19% from $7,327 million; adjusted net income¹ of $9,248 million, an increase of 24% from $7,449 million
• Reported EPS² of $11.44, an increase of 20% from $9.51; adjusted EPS^{1, 2} of $12.16, an increase of 26% from $9.68
• PCL of $3,617 million, compared with $3,761 million
• Reported ROE of 10.6%, compared with 9.7%; adjusted ROE¹ of 11.3%, compared with 9.8%

TORONTO, Dec. 4, 2025 /PRNewswire/ - BMO Financial Group (TSX:BMO) (NYSE:BMO) reported net income for fiscal 2025 was $8,725 million, compared with $7,327 million in the prior year, and EPS² of $11.44, compared with $9.51. Reported ROE was 10.6%, compared with 9.7% in fiscal 2024. Adjusted net income for fiscal 2025 was $9,248 million and adjusted EPS was $12.16, an increase from $7,449 million and $9.68, respectively, in the prior year. Adjusted ROE was 11.3%, compared with 9.8% in fiscal 2024.

Reported net income for the fourth quarter of 2025 was $2,295 million, compared with $2,304 million in the prior year, and reported EPS was $2.97, compared with $2.94. Adjusted net income for the fourth quarter was $2,514 million and adjusted EPS was $3.28, an increase from $1,542 million and $1.90, respectively, in the prior year.

"Fiscal 2025 was a strong year for BMO, with consistent execution and growing momentum to achieve our commitments to shareholders. We delivered both robust earnings growth and improved return on equity, driven by significant pre-provision, pre-tax earnings expansion, and sustained positive operating leverage. Revenue increased across all of our diversified businesses reflecting our success in delivering world-class client experiences and deepening relationships. We're deploying capital to drive future growth and higher shareholder returns," said Darryl White, CEO, BMO Financial Group.

"We enter 2026 in a position of financial strength, with a focused strategy and a winning culture that continues to grow and attract talent across the bank. At the same time, we're building on our investments in digital and AI-powered solutions to drive value for our clients. We're particularly excited to welcome the teams and clients of Burgundy Asset Management to BMO, as we continue to expand our private wealth solutions. These strengths position us to accelerate our performance and create long-term shareholder value, while continuing to support the clients and communities we serve," concluded Mr. White.

Concurrent with the release of results, BMO announced a first quarter 2026 dividend of $1.67 per common share, an increase of $0.04 or 2% from the prior quarter and an increase of $0.08 or 5% from the prior year. The quarterly dividend of $1.67 per common share is equivalent to an annual dividend of $6.68 per common share. During the quarter, we purchased for cancellation 8.0 million common shares under the normal course issuer bid.

Fourth Quarter 2025 Performance Review

Adjusted results and ratios in this section are on a non-GAAP basis. Refer to the Non-GAAP and Other Financial Measures section for further information on adjusting items. The order in which the impact on net income is discussed in this section follows the order of revenue, expenses and provision for credit losses, regardless of their relative impact.

Effective the fourth quarter of 2025, BMO combined its U.S. wealth management business, previously reported within Wealth Management, with U.S. Personal and Commercial Banking to form a unified U.S. Banking operating segment. BMO now reports financial results for four operating segments: Canadian Personal and Commercial Banking, U.S. Banking, Wealth Management and Capital Markets. Financial results for prior periods have been reclassified to conform with the current presentation.

Canadian P&C

Reported net income was $752 million, relatively unchanged from the prior year, and adjusted net income was $800 million, an increase of $35 million or 5%. Results reflected a 7% increase in revenue, primarily driven by higher net interest income due to both higher margins and balance growth, partially offset by higher expenses and a higher provision for credit losses.

U.S. Banking

Reported net income was $807 million, an increase of $526 million from the prior year, and adjusted net income was $871 million, an increase of $518 million.

On a U.S. dollar basis, reported net income was $582 million, an increase of $372 million from the prior year, and adjusted net income was $627 million, an increase of $365 million. Results reflected a 3% increase in revenue, driven by higher non-interest revenue and net interest income, lower expenses and a lower provision for credit losses.

Wealth Management

Reported net income was $383 million, an increase of $82 million or 27% from the prior year, and adjusted net income was $384 million, an increase of $83 million or 28%. Wealth and Asset Management reported net income was $304 million, an increase of $56 million or 23%, reflecting higher revenue due to the impact of stronger global markets and net sales, balance growth and higher brokerage transaction volumes, partially offset by higher expenses. Insurance net income was $79 million, an increase of $26 million or 48% from the prior year, primarily due to favourable market movements in the current year and business growth.

Capital Markets

Reported net income was $521 million, an increase of $270 million from the prior year, and adjusted net income was $532 million, an increase of $262 million or 97%. Results reflected higher revenue in both Global Markets and Investment and Corporate Banking, higher expenses and a lower provision for credit losses. 

Corporate Services

Reported net loss was $168 million, compared with reported net income of $721 million in the prior year, with the change reflecting a reversal of a legal provision in the prior year. Adjusted net loss was $73 million, compared with adjusted net loss of $147 million, with the change driven by higher treasury-related revenue, partially offset by higher expenses.

Capital

BMO's Common Equity Tier 1 (CET1) Ratio was 13.3% as at October 31, 2025, a decrease from 13.5% at the end of the third quarter of 2025, as internal capital generation was more than offset by the impact of the purchase of common shares for cancellation and higher source currency risk-weighted assets.

Regulatory Filings

BMO's continuous disclosure materials, including interim filings, annual Management's Discussion and Analysis and audited annual consolidated financial statements, Annual Information Form and Notice of Annual Meeting of Shareholders and Proxy Circular, are available on our website at www.bmo.com/investorrelations, on the Canadian Securities Administrators' website at www.sedarplus.ca, and on the EDGAR section of the U.S. Securities and Exchange Commission's website at www.sec.gov. Information contained in or otherwise accessible through our website (www.bmo.com), or any third-party websites mentioned herein, does not form part of this document.

Bank of Montreal uses a unified branding approach that links all of the organization's member companies. Bank of Montreal, together with its subsidiaries, is known as BMO Financial Group. In this document, the names BMO and BMO Financial Group, as well as the words "bank", "we" and "our", mean Bank of Montreal, together with its subsidiaries.

Caution Regarding Forward-Looking Statements 

Bank of Montreal's public communications often include written or oral forward-looking statements. Statements of this type are included in this document and may be included in other filings with Canadian securities regulators or the U.S. Securities and Exchange Commission, or in other communications. All such statements are made pursuant to the "safe harbor" provisions of, and are intended to be forward-looking statements under, the United States Private Securities Litigation Reform Act of 1995 and any applicable Canadian securities legislation. Forward-looking statements in this document may include, but are not limited to: statements with respect to our objectives and priorities for fiscal 2026 and beyond; our strategies or future actions; our targets and commitments (including with respect to net zero emissions); expectations for our financial condition, capital position, the regulatory environment in which we operate, the results of, or outlook for, our operations or the Canadian, U.S. and international economies; and include statements made by our management. Forward-looking statements are typically identified by words such as "will", "would", "should", "believe", "expect", "anticipate", "project", "intend", "estimate", "plan", "goal", "commit", "target", "may", "might", "schedule", "forecast", "outlook", "timeline", "suggest", "seek" and "could" or negative or grammatical variations thereof.

By their nature, forward-looking statements require us to make assumptions and are subject to inherent risks and uncertainties, both general and specific in nature. There is significant risk that predictions, forecasts, conclusions or projections will not prove to be accurate, that our assumptions may not be correct, and that actual results may differ materially from such predictions, forecasts, conclusions or projections. We caution readers of this document not to place undue reliance on our forward-looking statements, as a number of factors – many of which are beyond our control and the effects of which can be difficult to predict – could cause actual future results, conditions, actions or events to differ materially from the targets, expectations, estimates or intentions expressed in the forward-looking statements.

The future outcomes that relate to forward-looking statements may be influenced by many factors, including, but not limited to: general economic and market conditions in the countries in which we operate, including labour challenges and changes in foreign exchange and interest rates; political conditions, including changes relating to, or affecting, economic or trade matters, including tariffs, countermeasures and tariff mitigation policies; changes to our credit ratings; cyber and information security, including the threat of data breaches, hacking, identity theft and corporate espionage, as well as the possibility of denial of service resulting from efforts targeted at causing system failure and service disruption; technology resilience, innovation and competition; failure of third parties to comply with their obligations to us; disruptions of global supply chains; environmental and social risk, including climate change; the Canadian housing market and consumer leverage; inflationary pressures; changes in laws, including tax legislation and interpretation, or in supervisory expectations or requirements, including capital, interest rate and liquidity requirements and guidance, including if the bank were designated a global systemically important bank, and the effect of such changes on funding costs and capital requirements; changes in monetary, fiscal or economic policy; weak, volatile or illiquid capital or credit markets; the level of competition in the geographic and business areas in which we operate; exposure to, and the resolution of, significant litigation or regulatory matters, our ability to successfully appeal adverse outcomes of such matters and the timing, determination and recovery of amounts related to such matters; the accuracy and completeness of the information we obtain with respect to our customers and counterparties; our ability to successfully execute our strategic plans, complete acquisitions or dispositions and integrate acquisitions, including obtaining regulatory approvals, and realize any anticipated benefits from such plans and transactions; critical accounting estimates and judgments, and the effects of changes in accounting standards, rules and interpretations on these estimates; operational and infrastructure risks, including with respect to reliance on third parties; global capital markets activities; the emergence or continuation of widespread health emergencies or pandemics, and their impact on local, national or international economies, as well as their heightening of certain risks that may affect our future results; the possible effects on our business of war or terrorist activities; natural disasters, such as earthquakes or flooding, and disruptions to public infrastructure, such as transportation, communications, power or water supply; and our ability to anticipate and effectively manage risks arising from all of the foregoing factors.

We caution that the foregoing list is not exhaustive of all possible factors. Other factors and risks could adversely affect our results. For further information, please refer to the discussion in the Risks That May Affect Future Results section, and the sections related to credit and counterparty, market, liquidity and funding, operational non-financial, legal and regulatory compliance, strategic, environmental and social, and reputation risk in the Enterprise-Wide Risk Management section of BMO's 2025 Annual Report, all of which outline certain key factors and risks that may affect our future results. Investors and others should carefully consider these factors and risks, as well as other uncertainties and potential events, and the inherent uncertainty of forward-looking statements. We do not undertake to update any forward-looking statements, whether written or oral, that may be made from time to time by the organization or on its behalf, except as required by law. The forward-looking information contained in this document is presented for the purpose of assisting shareholders and analysts in understanding our financial position as at and for the periods ended on the dates presented, as well as our strategic priorities and objectives, and may not be appropriate for other purposes.

Material economic assumptions underlying the forward-looking statements contained in this document include those set out in the Economic Developments and Outlook section and the Allowance for Credit Losses section of BMO's 2025 Annual Report. Assumptions about the performance of the Canadian and U.S. economies, as well as overall market conditions and their combined effect on our business, are material factors we consider when determining our strategic priorities, objectives and expectations for our business. In determining our expectations for economic growth, we primarily consider historical economic data, past relationships between economic and financial variables, changes in government policies, and the risks to the domestic and global economy.

Financial Highlights

Non-GAAP and Other Financial Measures

Results and measures in this document are presented on a generally accepted accounting principles (GAAP) basis. Unless otherwise indicated, all amounts are in Canadian dollars and have been derived from our audited annual consolidated financial statements and our unaudited interim consolidated financial statements, prepared in accordance with International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board (IASB). References to GAAP mean IFRS. We use a number of financial measures to assess our performance, as well as the performance of our operating segments, including amounts, measures and ratios that are presented on a non‑GAAP basis, as described below. We believe that these non‑GAAP amounts, measures and ratios, read together with our GAAP results, provide readers with a better understanding of how management assesses results.

Non-GAAP amounts, measures and ratios do not have standardized meanings under GAAP. They are unlikely to be comparable to similar measures presented by other companies and should not be viewed in isolation from, or as a substitute for, GAAP results.

Certain information contained in BMO's 2025 Annual Management's Discussion and Analysis dated December 4, 2025 for the period ended October 31, 2025, is incorporated by reference into this document. For further details on the composition of supplementary financial measures, refer to the Glossary of Financial Terms section of BMO's 2025 Annual MD&A, which is available online at www.bmo.com/investorrelations and at www.sedarplus.ca.

Adjusted measures and ratios

Management considers both reported and adjusted results and measures to be useful in assessing underlying ongoing business performance. Adjusted results and measures remove certain specified items from revenue, non‑interest expense and income taxes, as detailed in the following table. Adjusted results and measures presented in this document are non‑GAAP. Presenting results on both a reported and an adjusted basis permits readers to assess the impact of certain items on results for the periods presented, and to better assess results excluding those items that may not reflect ongoing business performance. As such, the presentation may facilitate readers' analysis of underlying trends. Except as otherwise noted, management's discussion of changes in reported results in this document applies equally to changes in the corresponding adjusted results.

Tangible common equity and return on tangible common equity

Tangible common equity is calculated as common shareholders' equity, less goodwill and acquisition-related intangible assets, net of related deferred tax liabilities. Return on tangible common equity (ROTCE) is calculated as net income available to common shareholders, adjusted for the amortization of acquisition-related intangible assets and any impairments, as a percentage of average tangible common equity. ROTCE is commonly used in the North American banking industry and is meaningful as a consistent measure of the performance of businesses, whether they were acquired or developed organically.

Adjusting Items

Adjusted results in the current quarter and prior periods excluded the following items:

• Acquisition and integration costs of $3 million ($4 million pre-tax) in Q4-2025. Prior periods included expense of $4 million ($5 million pre-tax) in Q3-2025, a reversal of $1 million ($2 million pre-tax) in Q2-2025, and expenses of $7 million ($10 million pre-tax) in Q1-2025, $27 million ($35 million pre-tax) in Q4-2024, $19 million ($25 million pre-tax) in Q3-2024, $26 million ($36 million pre-tax) in Q2-2024, and $57 million ($76 million pre-tax) in Q1-2024. Amounts are recorded in non-interest expense in the related operating segment: Burgundy in Wealth Management; Bank of the West in Corporate Services; AIR MILES in Canadian P&C; and Clearpool and Radicle in Capital Markets.
• Amortization of acquisition-related intangible assets of $123 million ($168 million pre-tax) in Q4-2025, including a $64 million impairment related to AIR MILES. Prior periods included $69 million ($93 million pre-tax) in Q3-2025, $81 million ($109 million pre-tax) in Q2-2025, $79 million ($106 million pre-tax) in Q1-2025, $92 million ($124 million pre-tax) in Q4-2024, $79 million ($107 million pre-tax) in Q3-2024 and Q2-2024, and $84 million ($112 million pre-tax) in Q1-2024. Amounts are recorded in non-interest expense in the related operating segment.
• Impact of divestitures related to the announced sale of 138 branches in select U.S. markets resulting in a write-down of goodwill of $102 million (pre-tax and after-tax) in Q4-2025, recorded in non-interest expense in Corporate Services.
• Impact of a U.S. Federal Deposit Insurance Corporation (FDIC) special assessment recorded in non-interest expense in Corporate Services. Q4-2025 included a partial reversal of a prior charge of $9 million ($12 million pre-tax). Prior periods included a $4 million ($5 million pre-tax) partial reversal in Q3-2025, $4 million ($5 million pre-tax) expense in Q2-2025, a $5 million ($7 million pre-tax) partial reversal in Q1-2025, a $11 million ($14 million pre-tax) partial reversal in Q4-2024, a $5 million ($6 million pre-tax) expense in Q3-2024, a $50 million ($67 million pre-tax) expense in Q2-2024 and a $313 million ($417 million pre-tax) expense in Q1-2024.
• Impact of aligning accounting policies for employee vacation across legal entities of $70 million ($96 million pre-tax) in Q1-2025, recorded in non-interest expense in Corporate Services.
• Impact of a lawsuit associated with a predecessor bank, M&I Marshall and Ilsley Bank, recorded in Corporate Services in the prior year. Q4-2024 included a reversal of the fiscal 2022 legal provision of $870 million ($1,183 million pre-tax), comprising interest expense of $589 million and non-interest expense of $594 million. Prior periods also included $13 million ($18 million pre-tax) in Q3-2024, comprising interest expense of $14 million and non-interest expense of $4 million, and $12 million ($15 million pre-tax) in Q2-2024 and $11 million ($15 million pre-tax) in Q1-2024, both comprising interest expense of $14 million and non-interest expense of $1 million.
• Net accounting loss of $136 million ($164 million pre-tax) on the sale of a portfolio of recreational vehicle loans related to balance sheet optimization in Q1-2024, recorded in non-interest revenue in Corporate Services.

Adjusting items in aggregate decreased net income by $219 million in the current quarter, compared with a $762 million increase in the prior year and a decrease of $69 million in the prior quarter. On a fiscal basis, adjusting items in aggregate decreased net income by $523 million, compared with a decrease of $122 million in the prior year.

Non-GAAP and Other Financial Measures ⁽¹⁾

Summary of Reported and Adjusted Results by Operating Segment

Summary of Reported and Adjusted Results by Operating Segment (Continued)

Return on Equity and Return on Tangible Common Equity

Return on Equity by Operating Segment ⁽¹⁾

Foreign Exchange

The table above indicates the relevant average Canadian/U.S. dollar exchange rates and the impact of changes in those rates on reported and adjusted results in BMO's U.S. operations, comprising U.S. Banking and the U.S. operations in Capital Markets and Corporate Services.

The Canadian dollar equivalents of BMO's U.S. operations results that are denominated in U.S. dollars increased in the fourth quarter of fiscal 2025, relative to the third quarter of fiscal 2025 and increased relative to the fourth quarter of fiscal 2024, due to changes in the Canadian/U.S. dollar exchange rate. References in this document to the impact of the U.S. dollar do not include U.S. dollar-denominated amounts recorded outside of BMO's U.S. operations.

Economically, our U.S. dollar income stream was not hedged against the risk of changes in foreign exchange rates during fiscal 2025 and fiscal 2024. Changes in exchange rates will affect future results measured in Canadian dollars, and the impact on those results is a function of the periods in which revenue, expenses and provisions for (or recoveries of) credit losses and income taxes arise.

Refer to the Enterprise-Wide Capital Management section of BMO's 2025 Annual MD&A for a discussion of the impact that changes in foreign exchange rates can have on BMO's capital position.

Net Income

Q4 2025 vs. Q4 2024

Reported net income was $2,295 million, a decrease of $9 million from the prior year, and adjusted net income was $2,514 million, an increase of $972 million or 63%. Reported earnings per share (EPS) was $2.97, an increase of $0.03 from the prior year, and adjusted EPS was $3.28, an increase of $1.38.

Reported results decreased, primarily due to the reversal of a legal provision in the prior year, the write-down of goodwill related to the announced sale of branches in certain U.S. markets in the current year and higher amortization of acquisition-related intangible assets.

The increase in adjusted net income reflected higher revenue and a lower provision for credit losses, partially offset by higher expenses. Reported and adjusted net income increased across all operating segments. On a reported basis, Corporate Services recorded a net loss in the current year, compared with net income in the prior year, primarily due to the items noted above, and a lower net loss on an adjusted basis.

Q4 2025 vs. Q3 2025

Reported net income decreased $35 million or 1% from the prior quarter, and adjusted net income increased $115 million or 5%. Reported EPS decreased $0.17 from the prior quarter, and adjusted EPS increased $0.05, including the impact of higher dividends on preferred shares and distributions on other equity instruments.

The decrease in reported net income was primarily due to the specified items noted above. The increase in adjusted net income reflected higher revenue and a lower provision for credit losses, partially offset by higher expenses. Reported and adjusted net income increased in Capital Markets, U.S. Banking and Wealth Management, and decreased in Canadian P&C. On a reported basis, Corporate Services recorded a higher net loss compared with the prior quarter, and a lower net loss on an adjusted basis.

Revenue  

Q4 2025 vs. Q4 2024

Reported and adjusted revenue was $9,341 million, an increase of $384 million or 4% from the prior year on a reported basis, and an increase of $973 million or 12% on an adjusted basis. Growth in reported revenue was impacted by the reversal of accrued interest related to a legal provision in the prior year. Reported and adjusted revenue increased across all operating segments. Revenue decreased in Corporate Services on a reported basis and increased on an adjusted basis.

Reported and adjusted net interest income was $5,496 million, relatively unchanged from the prior year on a reported basis due to the item noted above, and increased $647 million or 13% on an adjusted basis, driven by higher net interest margin, higher net interest income in Corporate Services, higher trading-related net interest income and balance growth in Canadian P&C and Wealth Management. Trading-related net interest income was $124 million, an increase of $179 million from the prior year.

BMO's overall reported net interest margin of 1.67% decreased 3 basis points from the prior year. Adjusted net interest margin, excluding trading-related net interest income and trading and insurance assets was 2.06%, an increase of 15 basis points, primarily due to higher deposit margins and higher net interest income in Corporate Services.

Reported and adjusted non-interest revenue was $3,845 million, an increase of $326 million or 9% from the prior year, with increases across most categories, primarily driven by higher wealth management fees, underwriting and advisory fee revenue, securities gains, excluding trading, and lower mark-downs on fair value loans, partially offset by lower trading revenue. Trading non-interest revenue of $557 million decreased $139 million from the prior year, offset in net interest income.

Q4 2025 vs. Q3 2025

Reported and adjusted revenue increased $353 million or 4% from the prior quarter. Revenue increased across all operating segments, and in Corporate Services.

Net interest income was unchanged from the prior quarter, with higher non-trading net interest income in each operating segment and in Corporate Services, offset by lower trading-related net interest income. Trading-related net interest income decreased $201 million from the prior quarter, partially offset in non-interest revenue.

BMO's overall reported net interest margin decreased 2 basis points from the prior quarter, due to lower trading net interest income. Adjusted net interest margin, excluding trading-related net interest income and trading and insurance assets increased 7 basis points, primarily due to higher net interest income and lower low-yielding assets in Corporate Services, and higher deposit margins.

Reported and adjusted non-interest revenue increased $353 million or 10% from the prior quarter, due to higher trading revenue, wealth management fees, securities commission revenue, and higher net gains on investments compared with the prior quarter. The prior quarter benefitted from the gain on the sale of a non-strategic portfolio of insurance contracts. Trading non-interest revenue increased $151 million from the prior quarter.

Change in Net Interest Income, Average Earning Assets and Net Interest Margin ⁽¹⁾

Total Provision for Credit Losses

Q4 2025 vs. Q4 2024

Total provision for credit losses was $755 million, compared with a provision of $1,523 million in the prior year. Total provision for credit losses as a percentage of average net loans and acceptances was 44 basis points, compared with 91 basis points in the prior year. The provision for credit losses on impaired loans was $750 million, a decrease of $357 million, primarily due to lower provisions in U.S. Commercial Banking and Capital Markets, partially offset by higher provisions in Canadian unsecured consumer lending. The provision for credit losses on impaired loans as a percentage of average net loans and acceptances was 44 basis points, compared with 66 basis points in the prior year. There was a $5 million provision for credit losses on performing loans, compared with a $416 million provision in the prior year. The provision for credit losses on performing loans in the current quarter primarily reflected an improvement in the macroeconomic scenarios, as well as lower balances in certain portfolios, largely offset by uncertainty in credit conditions. The provision in the prior year reflected portfolio credit migration and a higher level of uncertainty.

Q4 2025 vs. Q3 2025

Total provision for credit losses decreased $42 million from the prior quarter, due to lower provisions on impaired and performing loans. The provision for credit losses on impaired loans decreased $23 million, largely due to lower provisions in U.S. Banking. The provision for credit losses on impaired loans as a percentage of average net loans and acceptances was 44 basis points, compared with 45 basis points in the prior quarter. There was a $5 million provision for credit losses on performing loans, compared with a $24 million provision in the prior quarter.

Impaired Loans 

Total gross impaired loans and acceptances (GIL) were $7,091 million, an increase from $6,951 million in the prior quarter, driven by higher impaired loans in Canadian Commercial Banking. GIL as a percentage of gross loans and acceptances increased to 1.04% from 1.02% in the prior quarter.

Loans classified as impaired during the quarter were $1,835 million, an increase from $1,796 million in the prior quarter, reflecting higher formations in consumer lending.

Non-Interest Expense 

Q4 2025 vs. Q4 2024

Reported non‑interest expense was $5,556 million, an increase of $1,129 million or 26% from the prior year, and adjusted non‑interest expense was $5,294 million, an increase of $418 million or 9%. 

The increase in reported results reflected the reversal of the legal provision in the prior year, the impact of the write-down of goodwill in the current year, and higher amortization of acquisition-related intangible assets, partially offset by lower acquisition and integration costs. Adjusted non-interest expense increased, primarily due to higher employee-related expenses, including performance-based compensation, higher computer and equipment costs and higher premises costs.

Reported efficiency ratio was 59.5%, compared with 49.4% in the prior year, and adjusted efficiency ratio was 56.7%, compared with 58.3%. Reported operating leverage was negative 21.2% and adjusted operating leverage was positive 3.0%.

Q4 2025 vs. Q3 2025

Reported non-interest expense increased $451 million or 9% from the prior quarter, and adjusted non-interest expense increased $282 million or 6%.

Reported non-interest expense included the items noted above. The increase in adjusted non-interest expense was primarily due to higher computer and equipment costs, professional fees and premises costs. 

Provision for Income Taxes

The reported provision for income taxes was $735 million, an increase of $32 million from the prior year, and a decrease of $21 million from the prior quarter. The reported effective tax rate was 24.2%, compared with 23.4% in the prior year and 24.5% in the prior quarter. The adjusted provision for income taxes was $778 million, an increase of $351 million from the prior year, and a decrease of $2 million from the prior quarter. The adjusted effective tax rate was 23.6%, compared with 21.7% in the prior year and 24.5% in the prior quarter.

The change in the reported effective tax rate relative to the prior year was primarily due to the impact of the Global Minimum Tax Act (GMTA) in the current year. The change in the adjusted effective tax rate relative to the prior year was primarily due to earnings mix, including the impact of lower income in the prior year and the impact of the GMTA in the current year. The change in the adjusted effective tax rate relative to the prior quarter was primarily due to earnings mix.

Refer to the Non-GAAP and Other Financial Measures section for further information on non-GAAP amounts, measures and ratios, including adjusting items in this Provision for Income Taxes section.

Capital Management

BMO's Common Equity Tier 1 (CET1) Ratio was 13.3% as at October 31, 2025, a decrease from 13.5% at the end of the third quarter of 2025, as internal capital generation was more than offset by the impact of the purchase of common shares for cancellation and higher source currency risk‑weighted assets.

CET1 Capital was $58.3 billion as at October 31, 2025, an increase from $57.9 billion as at July 31, 2025, with internal capital generation and a net positive impact from other items largely offset by the purchase of common shares for cancellation.

RWA were $437.9 billion as at October 31, 2025, an increase from $430.1 billion as at July 31, 2025. RWA increased due to higher credit risk and the impact of foreign exchange movements. The increase in credit risk primarily reflected an increase in asset size, changes in asset quality and methodology changes.

In calculating regulatory capital ratios, total RWA must be increased when a capital floor amount calculated under the standardized approaches, multiplied by a capital floor adjustment factor, is higher than a similar calculation using more risk-sensitive internal modelled approaches, where applicable. The capital floor was not operative as at October 31, 2025, unchanged from July 31, 2025.

The bank's Tier 1 and Total Capital Ratios were 15.0% and 17.3%, respectively, as at October 31, 2025, compared with 15.5% and 17.8%, respectively, as at July 31, 2025. The Tier 1 and Total Capital Ratios were lower, due to the same factors noted above for the CET1 Ratio, as well as the announced redemption of $1,250 million LRCNs, Series 1 (NVCC).

BMO's investments in foreign operations are primarily denominated in U.S. dollars, and the foreign exchange impact of U.S. dollar-denominated RWA and capital deductions may result in variability in the bank's capital ratios. We manage the impact of foreign exchange movements on RWA and capital deductions on our capital ratios, and during the current quarter this impact was largely offset.

Our Leverage Ratio was 4.3% as at October 31, 2025, a decrease from 4.5% at the end of the third quarter of 2025, due to higher leverage exposures and lower Tier 1 Capital.

The bank's risk-based Total Loss Absorbing Capacity (TLAC) Ratio and TLAC Leverage Ratio were 29.7% and 8.5%, respectively, as at October 31, 2025, compared with 29.5% and 8.5%, respectively, as at July 31, 2025.

Operating Segments Performance Review

BMO reports financial results for its four operating segments, Canadian Personal and Commercial Banking, U.S. Banking, Wealth Management and Capital Markets, all of which are supported by Corporate Units and Technology and Operations (T&O) within Corporate Services. Further information on how BMO reports operating segments results are outlined in the 2025 Operating Segments Performance Review section of BMO's 2025 Annual MD&A.

Canadian Personal and Commercial Banking (Canadian P&C) ⁽¹⁾

Q4 2025 vs. Q4 2024

Canadian P&C reported net income was $752 million, relatively unchanged from the prior year, as revenue growth was offset by higher expenses and a higher provision for credit losses.

Total revenue was $3,125 million, an increase of $191 million or 7% from the prior year. Net interest income increased $160 million or 7%, due to both higher net interest margin and higher balances. Non-interest revenue increased $31 million or 5%, primarily due to higher mutual fund distribution fee revenue, as well as higher gains on investments and deposit fee revenue in our commercial business. Net interest margin of 2.84% increased 10 basis points from the prior year, primarily due to higher deposit and loan margins, partially offset by a change in product mix.

Personal and Business Banking revenue increased $105 million or 5% and Commercial Banking revenue increased $86 million or 11%, both due to higher net interest income and non-interest revenue.

Total provision for credit losses was $649 million, an increase of $71 million from the prior year. Total provision for credit losses as a percentage of average net loans and acceptances was 76 basis points, compared with 69 basis points. The provision for credit losses on impaired loans was $496 million, an increase of $56 million, primarily due to higher provisions in Canadian unsecured consumer lending, partially offset by lower provisions in Commercial Banking. The provision for credit losses on impaired loans as a percentage of average net loans and acceptances was 58 basis points, compared with 53 basis points. There was a $153 million provision for credit losses on performing loans in the current quarter, compared with a $138 million provision in the prior year.

Non-interest expense was $1,442 million, an increase of $123 million or 9% from the prior year, primarily driven by higher technology costs and employee-related expenses, as well as higher amortization of acquisition-related intangible assets reflecting an impairment related to AIR MILES.

Average gross loans and acceptances increased $9.7 billion or 3% from the prior year to $342.7 billion. Personal and Business Banking balances increased 3%, primarily reflecting growth in residential mortgages. Commercial Banking balances increased 4% and credit card balances decreased 4%. Average deposits were $312.3 billion, relatively unchanged from the prior year as strong growth in operating deposits was offset by lower term deposits. Personal and Business Banking deposits decreased 2%, and Commercial Banking deposits increased 3%.

Q4 2025 vs. Q3 2025

Reported net income decreased $115 million or 13% from the prior quarter.

Total revenue increased $27 million or 1% from the prior quarter. Net interest income increased $5 million, due to higher deposit balances. Non-interest revenue increased $22 million from the prior quarter, due to higher gains on investments and mutual fund distribution fee revenue, partially offset by lower card-related revenue. Net interest margin of 2.84% was relatively unchanged from the prior quarter, with higher deposit margins offset by a change in product mix.

Personal and Business Banking revenue decreased $14 million or 1%, primarily due to lower net interest income. Commercial Banking revenue increased $41 million or 5%, due to higher non-interest revenue and higher net interest income.

Total provision for credit losses increased $84 million from the prior quarter. Total provision for credit losses as a percentage of average net loans and acceptances was 76 basis points, compared with 66 basis points. The provision for credit losses on impaired loans increased $7 million, largely due to higher provisions in Personal and Business Banking. The provision for credit losses on impaired loans as a percentage of average net loans and acceptances was 58 basis points, compared with 57 basis points. There was a $153 million provision for credit losses on performing loans in the current quarter, primarily due to uncertainty in credit conditions, compared with a $76 million provision in the prior quarter.

Non-interest expense increased $103 million or 8% from the prior quarter, primarily due to higher amortization of acquisition-related intangible assets as noted above, and higher employee-related expenses.

Average gross loans and acceptances increased $0.6 billion from the prior quarter. Personal and Business Banking balances increased 1% and credit card balances decreased 3%, with Commercial Banking balances relatively unchanged from the prior quarter. Average deposits increased $1.8 billion from the prior quarter. Personal and Business Banking deposits decreased 1% and Commercial Banking deposits increased 5%.

U.S. Banking ⁽¹⁾

Q4 2025 vs. Q4 2024

U.S. Banking ⁽¹⁾ reported net income was $807 million, an increase of $526 million from $281 million in the prior year. The impact of the stronger U.S. dollar increased net income by 5%, and revenue and expenses by 2%, respectively. All amounts in the remainder of this section are presented on a U.S. dollar basis.

Reported net income was $582 million, an increase of $372 million from $210 million in the prior year.

Total revenue was $2,072 million, an increase of $66 million or 3% from the prior year. Net interest income increased $24 million or 2%, due to higher net interest margin, partially offset by lower balances. Non-interest revenue increased $42 million or 10% from the prior year, primarily due to higher deposit fee revenue and wealth management fees. Net interest margin of 3.87% increased 15 basis points, primarily due to higher deposit margins driven by deposit optimization, partially offset by lower deposit balances.

Personal and Business Banking revenue increased $57 million or 9%, primarily due to higher net interest income. Commercial Banking revenue decreased $14 million or 1%, due to lower net interest income, partially offset by higher non-interest revenue. Private Wealth revenue increased $23 million or 12%.

Total provision for credit losses was $86 million, a decrease of $440 million from the prior year. Total provision for credit losses as a percentage of average net loans and acceptances was 22 basis points, compared with 131 basis points. The provision for credit losses on impaired loans was $151 million, a decrease of $177 million, largely due to lower provisions in Commercial Banking. The provision for credit losses on impaired loans as a percentage of average net loans and acceptances was 38 basis points, compared with 82 basis points. There was a $65 million recovery on performing loans in the current quarter, compared with a $198 million provision in the prior year.

Non-interest expense was $1,238 million, a decrease of $14 million or 1% from the prior year, reflecting lower technology and other operating costs, partially offset by higher employee-related expenses.

Average gross loans and acceptances decreased $3.5 billion or 2% from the prior year to $157.7 billion. Commercial Banking balances decreased 5% reflecting balance sheet optimization initiatives, Personal and Business Banking balances increased 3% and Private Wealth balances increased 14%. Average total deposits decreased $8.5 billion or 5% from the prior year to $170.3 billion, driven by lower term deposits. Commercial Banking deposits decreased 4%, Personal and Business Banking deposits decreased 6% and Private Wealth deposits decreased 2%.

Assets under management increased $13.5 billion or 19% from the prior year to $83.0 billion, driven by stronger global markets and higher client assets. Assets under administration increased $20.9 billion or 25% to $104.4 billion, primarily driven by stronger global markets.

Q4 2025 vs. Q3 2025

Reported net income increased $40 million or 5% from the prior quarter. The impact of the stronger U.S. dollar increased revenue, expenses and net income by 1%, respectively. All amounts in the remainder of this section are presented on a U.S. dollar basis.

Reported net income increased $24 million or 4% from the prior quarter.

Total revenue was relatively unchanged from the prior quarter. Net interest income decreased $8 million or 1%, due to lower balances, partially offset by higher net interest margin. Non-interest revenue increased $21 million or 4%, primarily due to higher wealth management fees and card-related revenue. Net interest margin increased 5 basis points, primarily due to higher deposit margins, partially offset by lower deposit balances.

Personal and Business Banking revenue increased $10 million or 1% from the prior quarter, due to higher net interest income, partially offset by lower non-interest revenue. Commercial Banking revenue decreased $7 million or 1%, due to lower net interest income, partially offset by higher non-interest revenue. Private Wealth revenue increased $10 million or 4%, due to higher non-interest revenue.

Total provision for credit losses decreased $39 million from the prior quarter. Total provision for credit losses as a percentage of average net loans and acceptances was 22 basis points, compared with 31 basis points. The provision for credit losses on impaired loans decreased $24 million, due to lower provisions in both Personal and Business Banking and Commercial Banking. The provision for credit losses on impaired loans as a percentage of average net loans and acceptances was 38 basis points, compared with 44 basis points. There was a $65 million recovery on performing loans in the current quarter, compared with a $50 million recovery in the prior quarter.

Non-interest expense increased $21 million or 2% from the prior quarter, primarily due to higher operating and technology costs.

Average gross loans and acceptances decreased $2.9 billion or 2% from the prior quarter. Commercial Banking balances decreased 3%, Personal and Business Banking balances increased 1% and Private Wealth balances increased 2%. Average total deposits decreased $2.5 billion or 1% from the prior quarter. Commercial Banking deposits decreased 1%, Personal and Business Banking deposits decreased 2%, with Private Wealth deposit balances relatively unchanged. 

Assets under management increased $7.2 billion or 9% from the prior quarter, driven by stronger global markets and higher client assets. Assets under administration increased $0.5 billion or 1% from the prior quarter.

Wealth Management ⁽¹⁾

Q4 2025 vs. Q4 2024

Wealth Management ⁽¹⁾ reported net income was $383 million, an increase of $82 million or 27% from the prior year. Wealth and Asset Management reported net income was $304 million, an increase of $56 million or 23%, and Insurance net income was $79 million, an increase of $26 million or 48%.

Total revenue was $1,419 million, an increase of $200 million or 16% from the prior year. Revenue in Wealth and Asset Management was $1,290 million, an increase of $158 million or 14%, primarily due to the impact of stronger global markets and net sales, strong growth in loan and deposit balances and higher brokerage transaction volumes. Insurance revenue was $129 million, an increase of $42 million or 48%, due to favourable market movements in the current quarter and business growth. 

Total provision for credit losses was $4 million, a decrease of $6 million from the prior year.

Non-interest expense was $907 million, an increase of $93 million or 11%, primarily due to higher employee-related expenses, including higher revenue-based costs.

Assets under management increased $64.3 billion or 20% from the prior year to $390.3 billion, and assets under administration increased $37.1 billion or 15% to $282.3 billion, both driven by stronger global markets and higher client assets. Average gross loans increased 4% and average deposits increased 16%.

Q4 2025 vs. Q3 2025

Reported net income increased by $5 million or 2% from the prior quarter. Wealth and Asset Management reported net income increased $21 million or 8% from the prior quarter, and Insurance net income decreased $16 million or 17%.

Total revenue increased $76 million or 6% from the prior quarter. Revenue in Wealth and Asset Management increased $92 million or 8%, primarily due to the impact of stronger global markets and net sales, higher brokerage transaction volumes and good growth in loan and deposit balances. Insurance revenue decreased $16 million or 11%, primarily due to a gain on sale of a portfolio of insurance contracts in the prior quarter, partially offset by more favourable market movements in the quarter. 

Total provision for credit losses increased $1 million from the prior quarter.

Non-interest expense increased $68 million or 8%, primarily due to higher employee-related expenses, including higher revenue-based costs.

Assets under management increased $31.2 billion or 9% and assets under administration increased $19.9 billion or 8%, both driven by stronger global markets and higher client assets. Average gross loans increased by 1% and average deposits increased by 3%.

Capital Markets ⁽¹⁾

Q4 2025 vs. Q4 2024

Capital Markets reported net income was $521 million, an increase of $270 million or 108% from the prior year.

Total revenue was $1,819 million, an increase of $219 million or 14% from the prior year. Global Markets revenue increased $97 million or 10%, primarily due to higher equities trading revenue and higher debt and equity issuances, partially offset by lower interest rate trading revenue. Investment and Corporate Banking revenue increased $122 million or 18%, primarily due to higher Canadian underwriting and advisory fee revenue and lower markdowns on fair value loans.

Total recovery of the provision for credit losses was $2 million, compared with a $211 million provision in the prior year. The provision for credit losses on impaired loans was $37 million, a decrease of $166 million from the prior year. There was a $39 million recovery on performing loans in the current quarter, compared with a $8 million provision in the prior year.

Non-interest expense was $1,122 million, an increase of $35 million or 3% from the prior year, primarily driven by higher performance-based compensation.

Average gross loans and acceptances of $85.6 billion increased $3.2 billion or 4% from the prior year.

Q4 2025 vs. Q3 2025

Reported net income increased $83 million or 19% from the prior quarter.

Total revenue increased $43 million or 2% from the prior quarter. Global Markets revenue decreased $18 million or 2%, primarily due to lower interest rate and commodities trading revenue, partially offset by higher equities trading revenue. Investment and Corporate Banking revenue increased $61 million or 8%, primarily due to higher underwriting revenue and higher gains on investments.

Total recovery of the provision for credit losses was $2 million, compared with a $56 million provision in the prior quarter. The provision for credit losses on impaired loans was $37 million, an increase of $4 million from the prior quarter. There was a $39 million recovery on performing loans in the current quarter, compared with a $23 million provision in the prior quarter.

Non-interest expense decreased $17 million or 1% from the prior quarter, driven by lower employee-related expenses, including the impact of timing on performance-based compensation, partially offset by higher operating costs.

Average gross loans and acceptances increased $2.9 billion or 4% from the prior quarter.

Corporate Services ⁽¹⁾

Q4 2025 vs. Q4 2024

Corporate Services reported net loss was $168 million, compared with reported net income of $721 million in the prior year, with the change reflecting a reversal of legal provision in the prior year and a write-down of goodwill related to the announced sale of branches in certain U.S. markets. 

Adjusted net loss was $73 million, compared with adjusted net loss of $147 million in the prior year, with the change driven by higher treasury-related revenue, partially offset by higher expenses.

Q4 2025 vs. Q3 2025

Reported net loss was $168 million, compared with reported net loss of $120 million in the prior quarter, and adjusted net loss was $73 million, compared with adjusted net loss of $123 million in the prior quarter.

The increase in reported net loss included the write-down of goodwill noted above. The lower adjusted net loss reflected higher treasury-related revenue, partially offset by higher expenses.

Consolidated Statement of Income

Consolidated Statement of Comprehensive Income

Consolidated Balance Sheet

Consolidated Statement of Changes in Equity

Investor and Media Information

Investor Presentation Materials

Interested parties are invited to visit BMO's website at www.bmo.com/investorrelations to review the 2025 Annual MD&A and audited annual consolidated financial statements, quarterly presentation materials and supplementary financial and regulatory information package.

Quarterly Conference Call and Webcast Presentations

Interested parties are also invited to listen to our quarterly conference call on Thursday, December 4, 2025, at 8:30 a.m. (ET). The call may be accessed by telephone at 647-495-7514 (from within Toronto) or 1-888-596-4144 (toll-free outside Toronto), entering Passcode: 89709#. A replay of the conference call can be accessed until January 4, 2026, by calling 647-362-9199 (from within Toronto) or 1-800-770-2030 (toll-free outside Toronto) and entering Passcode: 89709#.

A live webcast of the call can be accessed on our website at www.bmo.com/investorrelations. A replay can also be accessed on the website.

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SOURCE BMO Financial Group