BMO Surpasses Expectations: Record Profits and Reduced Credit Loss Provisions in Q3

Bank of Montreal Exceeds Expectations, Lowers Provisions for Credit Losses in Q3

August 26, 2025 — By Naimul Karim

BMO beats forecasts. BMO lowers credit loss reserves. BMO shows strong earnings. Each word links closely to the next.

Financial Performance Overview

BMO earns $2.33 billion. This is more than $1.86 billion from last year. Net income rises. Earnings per share reach $3.14. Adjusted net income grows to $2.39 billion from $1.98 billion before. Adjusted earnings per share then come in at $3.23. These numbers beat the expected $2.97 per share.

Segment Highlights

The bank earns strong results in U.S. operations, capital markets, and wealth management. In the U.S. sector, adjusted net income hits $769 million. This marks a 42% jump year-over-year. Wealth management and capital markets rise by 21% and 12% as well.

BMO’s Canadian business weakens. Its adjusted income falls by 5%. This drop equals a $50 million decrease to $870 million.

Provisions for Credit Losses Decline

Credit loss reserves matter. They show funds set aside for loan defaults. Many banks raised these reserves due to economic risks. BMO, however, lowers them to $797 million. This is down from $906 million one year ago.

The fall comes from U.S. and capital market operations. Canadian commercial banking and unsecured personal loans see higher reserves.

Management Commentary and Market Reaction

CEO Darryl White praises “disciplined execution.” He credits clear credit improvements. U.S. operations lead in profit.

Analyst John Aiken of Jefferies Inc. says U.S. retail is strong. He warns that most divisions barely meet forecasts. He notes that lower credit loss reserves drive the gains. He worries about negative U.S. loan growth. He expects that some banks could soon do better than BMO.

Analyst Mike Rizvanovic of Bank of Nova Scotia suggests that these results may lift earnings forecasts for 2026. Dividend Announcement

BMO declares a quarterly dividend of $1.63 per common share. It stays consistent with past quarters.

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BMO’s report acts as an early sign of economic trends. Its results often guide ideas about Canada’s broader economy, especially with trade issues and other uncertainties.

For more information and detailed financial updates, readers are encouraged to subscribe to the Financial Post.

Contact: nkarim@postmedia.com

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