Bank of Montreal Reports Strong Adjusted Earnings Growth Amid Decline in Reported Income Due to Finance-Business Sale
Bank of Montreal reported a significant drop in its third-quarter net income by 25% year-over-year, falling to C$1.75 billion due primarily to the announced sale of its Transportation and Vendor Finance businesses. However, adjusted non-GAAP earnings rose sharply by 19%, reaching C$2.86 billion, highlighting strong performance from core operations. The finance-business divestiture led to a pretax charge of C$1.09 billion or an after-tax cost of C$962 million due mainly to goodwill reduction. The bank plans to retain a 19.9% equity stake in the sold businesses, and the transaction is expected to close by Q4 2026 pending regulatory approvals. Despite these adjustments, BMO's operating segments showed robust growth with record pre-provision earnings across all divisions. Adjusted return on equity improved from 12.0% to 14.0%, while credit costs declined overall.
Topics: adjusted income growth Bank of Montreal divestiture impact finance business sale