Bank of Montreal

Good morning and welcome to BMO Financial Group's Q4 2023 earnings release and conference call for December 1st, 2023. Your host for today is Christine Viau. Please go ahead. Thank you and good morning. We will begin the call with remarks from Daryl White, BMO CEO, followed by Typhoon Tizen, our Chief Financial Officer, and Piyush Agrawal, our Chief Risk Officer. Also present to take questions today are Ernie Johanson, head of BMO North American Personal and Business Banking, Nadeem Herji, head of BMO Commercial Banking, Alan Tenenbaum and Dan Barkley are representing BMO Capital Markets, Dallin Kamenga from BMO Wealth Management, and Daryl Hackett, BMO U.S. CEO. As noted on slide two, forward-looking statements may be made during this call, which involve assumptions that have inherent risks and uncertainties. Actual results could differ materially from these statements. I would also remind listeners that the bank uses non-GAAP financial measures to arrive at adjusted results. Management measures performance on a reported and adjusted basis and considers both to be useful in assessing underlying business performance. Daryl and Typhoon will be referring to adjusted results in their remarks unless otherwise noted. I will now turn the call over to Daryl.

Thank you, Christina, and good morning, everyone. Our results this year reflect the fundamental strengths and diversification of our businesses. Driven by record revenue and ongoing momentum in Canadian personal and commercial banking and the contribution of the Bank of the West, we delivered good performance in a challenging economic backdrop with net income of $8.7 billion in fiscal 2023. Adjusted earnings per share were $2.81 for the fourth quarter and $11.73 for the year. Pre-provision pre-tax earnings grew 5% for the year, driven by 16% growth in revenue, reflecting both organic growth across our businesses and the benefit of acquisitions. Revenue was up 10% in Canadian P&C, 43% in U.S. P&C, and 5% in each of wealth management and capital markets. We continue to have a strong capital position with a CET1 ratio of 12.5%. For the year, return on equity was 12.3% and return on tangible common equity was 15.8%. And this morning, we announced a dividend increase of 4 cents to $1.51 per share, a 6% increase over last year. This year, we made significant progress against our consistent strategic priorities to continue to grow and strengthen our bank. enhance customer service, and invest in communities. We closed and integrated strategic acquisitions, advanced our digital first capabilities, and increased our focus on delivering interconnected one client experiences. With the successful conversion of Bank of the West, which I'll expand upon in a moment, BMO is the most integrated north-south bank on the continent. For our customers joining from Bank of the West, this means an upgrade to the strength and breadth of their bank, with access to new capabilities, products, and services to help them make financial progress. When we enter a new market, we commit to making progress for our clients and communities. Our BMO Empower 2.0 plan is set to deliver more than $40 billion to support underrepresented communities and organizations across our US footprint, including loans to minority-owned small businesses, community reinvestment in real estate, affordable housing, and neighborhood revitalization. We also completed the acquisition of air miles with nearly 10 million active collectors who will benefit from the stability and rejuvenation of the most recognized loyalty program in Canada. Since we closed in June, we've added already 50 new partners and introduced robust new features including an updated travel booking platform and a mobile app leading to four consecutive months of new collector growth and increased engagement. Our relentless focus on putting customers first and supporting their financial goals with innovative digital experiences and expert guidance continues to be recognized, including being ranked first by JD Power in both its 2023 Canada Retail Banking and