Bank of Montreal (Symbol-BMO)

Discuss your favourite picks, broker, and trading or investment style.
MarkT
Contributor
Contributor
Posts: 42
Joined: 30 Oct 2009 00:47

Re: Bank of Montreal (Symbol-BMO)

Post by MarkT »

I have to admit, personally I wouldn''t invest in an unprofitable bank. But maybe BMO knows something.
User avatar
Descartes
Veteran Contributor
Veteran Contributor
Posts: 1856
Joined: 03 Nov 2008 09:59

Re: Bank of Montreal (Symbol-BMO)

Post by Descartes »

JaydoubleU wrote:What Bad Luck, one of your companies just made a big and dubious acquisition in a country with massive debt and record unemployment thereby diluting your holdings significantly and causing the stock price to plunge."
We are now about a buck away from the price BMO had before their "disastrous" decision to acquire Harris.
Almost an 8% recovery + a dividend: not bad for 2 months.

My question: are you BMO stockholders who complained about the deal at the time going to sell soon (the concerns about dilution and dubious American investments still stand, I would guess) or has your attitude changed now that the price is close to full restoration?

(I caught the knife back in December as mentioned upthread and will continue to hold).
"A dividend is a dictate of management. A capital gain is a whim of the market."
User avatar
AltaRed
Veteran Contributor
Veteran Contributor
Posts: 33398
Joined: 05 Mar 2005 20:04
Location: Ogopogo Land

Re: Bank of Montreal (Symbol-BMO)

Post by AltaRed »

I have held BMO for many years. Buy and hold type of guy that I am. No intention to ever sell although my executors might do so.
Imagefiniki, the Canadian financial wiki The go-to place to bolster your financial freedom
JaydoubleU
Veteran Contributor
Veteran Contributor
Posts: 3103
Joined: 13 Sep 2007 22:52

Re: Bank of Montreal (Symbol-BMO)

Post by JaydoubleU »

My question: are you BMO stockholders who complained about the deal at the time going to sell soon (the concerns about dilution and dubious American investments still stand, I would guess) or has your attitude changed now that the price is close to full restoration?
I'm still watching. Kind of riding the wave of general asset appreciation now, including BMO. May continue to hold and collect the roughly 5% dividend. Not a large enough holding to really worry about, although if it were over 5% of the portfolio I would certainly trim the position now.
j831robert
Contributor
Contributor
Posts: 752
Joined: 01 May 2005 14:12
Location: SW Ontario

Re: Bank of Montreal (Symbol-BMO)

Post by j831robert »

Must admit the thought of selling never occured to me. Like Alta Red I'm a buy and holder when it comes to this company and, with an ACB of $15.468 I can't really afford to sell anyway. I'll let my executor worry about the capital gains when it's his turn to dispose while in the meantime I'll enjoy the dividends, as I have for 25+ years now. :lol:
User avatar
Shakespeare
Veteran Contributor
Veteran Contributor
Posts: 23396
Joined: 15 Feb 2005 23:25
Location: Calgary, AB

Re: Bank of Montreal (Symbol-BMO)

Post by Shakespeare »

BMO's US holdings continue to be a girl that blows in your ear all evening and never kisses you.
Sic transit gloria mundi. Tuesday is usually worse. - Robert A. Heinlein, Starman Jones
User avatar
AltaRed
Veteran Contributor
Veteran Contributor
Posts: 33398
Joined: 05 Mar 2005 20:04
Location: Ogopogo Land

Re: Bank of Montreal (Symbol-BMO)

Post by AltaRed »

Interesting to see how one's perspective ajusts with time (my last post above in 2011) and perhaps more importantly market returns in the last 6 years. Today, I wouldn't be nearly as adverse to selling down some of that capital as part of a VPW withdrawal plan. I don't much care for big legacies.
Imagefiniki, the Canadian financial wiki The go-to place to bolster your financial freedom
Taggart
Veteran Contributor
Veteran Contributor
Posts: 6893
Joined: 05 Dec 2005 07:34

Re: Bank of Montreal (Symbol-BMO)

Post by Taggart »

All I know is BMO gave me a 5% raise yesterday. More than the recent inflation rate in Canada, so I'm content.
User avatar
ghariton
Veteran Contributor
Veteran Contributor
Posts: 15954
Joined: 18 Feb 2005 18:59
Location: Ottawa

Re: Bank of Montreal (Symbol-BMO)

Post by ghariton »

I'm glad I no longer pick individual securities.

George
The juice is worth the squeeze
User avatar
kcowan
Veteran Contributor
Veteran Contributor
Posts: 16033
Joined: 18 Apr 2006 20:33
Location: Pacific latitude 20/49

Re: Bank of Montreal (Symbol-BMO)

Post by kcowan »

ghariton wrote: 25 May 2017 17:33 I'm glad I no longer pick individual securities.

George
i am saddened that your mind is no longer open to alternative approaches!
For the fun of it...Keith
User avatar
Peculiar_Investor
Administrator
Administrator
Posts: 13271
Joined: 01 Mar 2005 14:52
Location: Calgary
Contact:

Re: Bank of Montreal (Symbol-BMO)

Post by Peculiar_Investor »

A major move announced this morning as they are spending USD 16.3 billion dollars on an acquisition.

BNP Paribas reached an agreement with BMO for the sale of Bank of the West
BNP Paribas press release wrote:BNP Paribas has reached an agreement with BMO Financial Group for the sale of 100% of its retail & commercial banking activities in the United States conducted through its subsidiary Bank of the West, Inc. for a total consideration of 16.3 billion US dollars in cash (the "Transaction")

The Transaction is expected to formally close during the course of 2022, upon customary condition precedents, including the approval of the relevant antitrust and regulatory authorities.
BMO's press release: BMO Financial Group accelerates North American growth with strategic acquisition of Bank of the West. What's in it for BMO? Their press release provides some insight,
BMO press release wrote:On closing, the acquisition will bring nearly 1.8 million customers to BMO and will further extend its banking presence through 514 additional branches and commercial and wealth offices in key U.S. growth markets. Post closing, BMO will have a strong position in 3 of the top 5 U.S. markets, a footprint in 32 states, expanded national specialty commercial businesses and a digital banking platform gathering deposits in all 50 states. With approximately 70% of Bank of the West's deposits in California, BMO is making a scaled entry to a market with a population of approximately 40 million people producing US$3.1 trillion of GDP – which, if considered as a country, would rank as the world's 5th largest economy.
Imagefiniki, the Canadian financial wiki New editors wanted and welcomed, please help collaborate and improve the wiki.

Normal people… believe that if it ain’t broke, don’t fix it. Engineers believe that if it ain’t broke, it doesn’t have enough features yet. – Scott Adams
SQRT
Veteran Contributor
Veteran Contributor
Posts: 5441
Joined: 01 Nov 2012 11:33
Location: Ontario/Arizona

Re: Bank of Montreal (Symbol-BMO)

Post by SQRT »

Peculiar_Investor wrote: 20 Dec 2021 06:52 A major move announced this morning as they are spending USD 16.3 billion dollars on an acquisition.

BNP Paribas reached an agreement with BMO for the sale of Bank of the West
BNP Paribas press release wrote:BNP Paribas has reached an agreement with BMO Financial Group for the sale of 100% of its retail & commercial banking activities in the United States conducted through its subsidiary Bank of the West, Inc. for a total consideration of 16.3 billion US dollars in cash (the "Transaction")

The Transaction is expected to formally close during the course of 2022, upon customary condition precedents, including the approval of the relevant antitrust and regulatory authorities.
BMO's press release: BMO Financial Group accelerates North American growth with strategic acquisition of Bank of the West. What's in it for BMO? Their press release provides some insight,
BMO press release wrote:On closing, the acquisition will bring nearly 1.8 million customers to BMO and will further extend its banking presence through 514 additional branches and commercial and wealth offices in key U.S. growth markets. Post closing, BMO will have a strong position in 3 of the top 5 U.S. markets, a footprint in 32 states, expanded national specialty commercial businesses and a digital banking platform gathering deposits in all 50 states. With approximately 70% of Bank of the West's deposits in California, BMO is making a scaled entry to a market with a population of approximately 40 million people producing US$3.1 trillion of GDP – which, if considered as a country, would rank as the world's 5th largest economy.
Huge move. Good for them.
Immediately accretive, uses current excess capital, including 2% discount for DRIP (will create another ( $2-3billion in capital). Estimated 14% IRR.

Edit to add. While not as transformational as the TD purchase of Canada Trust in 1999. This is quite a big move. It represents about 20% of BMO’s market cap. The CT purchase represented about 38% of TD’s market cap at the time but was an in market deal that transformed TD’s position within the Canadian banking market. Looks like most of the 10% accretion comes mostly from the deployment of excess capital. Cost synergies (projected at $860 million) seem pretty high given they won’t be closing any branches.
Last edited by SQRT on 21 Dec 2021 08:15, edited 1 time in total.
peter
Contributor
Contributor
Posts: 662
Joined: 10 Oct 2005 21:37
Location: Alberta

Re: Bank of Montreal (Symbol-BMO)

Post by peter »

Also not quite as bizarre as my original interpretation of a terse headline from Interactive Brokers that I took to mean BNP Paribas was buying BMO.
User avatar
AltaRed
Veteran Contributor
Veteran Contributor
Posts: 33398
Joined: 05 Mar 2005 20:04
Location: Ogopogo Land

Re: Bank of Montreal (Symbol-BMO)

Post by AltaRed »

I think this is a good move for BMO. There is nowhere much left to go in Canada to bulk up and California as the world's 5th largest economy (if CA was a country) compared to Canada at #10 offers an unlimited growth opportunity, potentially on a national basis. BMO already has experience in the Midwest with BMO Harris so it is not like they don't know how to operate in the USA. I am (will be) a happy shareholder.....finally!
Imagefiniki, the Canadian financial wiki The go-to place to bolster your financial freedom
SQRT
Veteran Contributor
Veteran Contributor
Posts: 5441
Joined: 01 Nov 2012 11:33
Location: Ontario/Arizona

Re: Bank of Montreal (Symbol-BMO)

Post by SQRT »

I’ve owned BMO for about 15 years (ACB about $71). Was under water for a long time but my total GAGR is about 12.5% at this point. Not bad. I also think this is good move for them, although execution is always the key. Probably makes more sense than returning capital to shareholders through buy backs. Solves the excess capital problem quite nicely.

Pressure now on TD?
User avatar
Descartes
Veteran Contributor
Veteran Contributor
Posts: 1856
Joined: 03 Nov 2008 09:59

Re: Bank of Montreal (Symbol-BMO)

Post by Descartes »

I started a position in BMO since 2010. Oddly my ACB is the same as SQRT: ~$71. I didn't realize BMO was in the doldrums for so long.
This is maybe a benefit of maniacally obsessing over dividends rather than just capital gains. :P

I must admit, I have never heard of the Bank of the West before this announcement.
Based solely on number of customers, it is about 1/6 the size of BMO.
I can't find financials on this thing since it is a private bank but maybe the info is in BNP Paripas financials.
Anyone take a look?
"A dividend is a dictate of management. A capital gain is a whim of the market."
User avatar
Shakespeare
Veteran Contributor
Veteran Contributor
Posts: 23396
Joined: 15 Feb 2005 23:25
Location: Calgary, AB

Re: Bank of Montreal (Symbol-BMO)

Post by Shakespeare »

So my earliest BMO (it has moved between non-registered and registered accounts) is 12.375 (1994).

Added later: split adjusted (2:1)
Sic transit gloria mundi. Tuesday is usually worse. - Robert A. Heinlein, Starman Jones
User avatar
adrian2
Veteran Contributor
Veteran Contributor
Posts: 13333
Joined: 19 Feb 2005 08:42
Location: Greater Toronto Area

Re: Bank of Montreal (Symbol-BMO)

Post by adrian2 »

The so-called 5th Slam in tennis is the tournament in Indian Wells, CA, whose main sponsors are Oracle and BNP Paribas.
Maybe now we're going to see BMO's name plastered all over those walls? :P
Imagefiniki, the Canadian financial wiki
“It doesn't matter how beautiful your theory is, it doesn't matter how smart you are. If it doesn't agree with experiment, it's wrong.” [Richard P. Feynman, Nobel prize winner]
User avatar
AltaRed
Veteran Contributor
Veteran Contributor
Posts: 33398
Joined: 05 Mar 2005 20:04
Location: Ogopogo Land

Re: Bank of Montreal (Symbol-BMO)

Post by AltaRed »

One would think so in some way like they do BMO Harris but only after closing.
Imagefiniki, the Canadian financial wiki The go-to place to bolster your financial freedom
newin96
Contributor
Contributor
Posts: 272
Joined: 31 Mar 2013 16:47

Re: Bank of Montreal (Symbol-BMO)

Post by newin96 »

Bank of Montreal Announces CAD$2.70 Billion Public Offering of Common Shares
https://seekingalpha.com/pr/18719929?source=ansh $BMO
To help fund acquisition...
User avatar
AltaRed
Veteran Contributor
Veteran Contributor
Posts: 33398
Joined: 05 Mar 2005 20:04
Location: Ogopogo Land

Re: Bank of Montreal (Symbol-BMO)

Post by AltaRed »

About a $5 haircut to closing today. I think BMO said early on it was going to fund some of the acquisition through an equity offering.
Imagefiniki, the Canadian financial wiki The go-to place to bolster your financial freedom
SQRT
Veteran Contributor
Veteran Contributor
Posts: 5441
Joined: 01 Nov 2012 11:33
Location: Ontario/Arizona

Re: Bank of Montreal (Symbol-BMO)

Post by SQRT »

AltaRed wrote: 22 Mar 2022 22:30 About a $5 haircut to closing today. I think BMO said early on it was going to fund some of the acquisition through an equity offering.
Yes, they disclosed a $2.7 billion equity issue in their original press release about the deal. Still it’s a big equity issue. So far this year, BMO has been the best performing of the big 6 banks though.

Edit to add. BMO trading slightly above the issue price of $149 so looks like the market has absorbed it in stride.
User avatar
Peculiar_Investor
Administrator
Administrator
Posts: 13271
Joined: 01 Mar 2005 14:52
Location: Calgary
Contact:

Re: Bank of Montreal (Symbol-BMO)

Post by Peculiar_Investor »

One hurdle completed, BMO’s $16.3 Billion Bank of the West Deal Wins US Regulatory Nod - Bloomberg
Bloomberg wrote:The Office of the Comptroller of the Currency also said it green-lit the merger. Bank of Montreal said it expects the deal will be completed on Feb. 1.
No idea if there are any other regulatory approvals required. If they expect the deal to complete by Feb. 1 that would seem to imply not much left to complete the deal.
Imagefiniki, the Canadian financial wiki New editors wanted and welcomed, please help collaborate and improve the wiki.

Normal people… believe that if it ain’t broke, don’t fix it. Engineers believe that if it ain’t broke, it doesn’t have enough features yet. – Scott Adams
User avatar
AltaRed
Veteran Contributor
Veteran Contributor
Posts: 33398
Joined: 05 Mar 2005 20:04
Location: Ogopogo Land

Re: Bank of Montreal (Symbol-BMO)

Post by AltaRed »

I received notice today from BMO Harris that BMO Harris is re-branding from bmoharris.com to simply being BMO effective Feb 25th. Apparently this is exactly what BMO is also doing with Bank of the West on the same time frame perhaps?

It will be curious what the home page of BMO.com will look like as of that weekend.
Imagefiniki, the Canadian financial wiki The go-to place to bolster your financial freedom
User avatar
poedin
Veteran Contributor
Veteran Contributor
Posts: 2614
Joined: 27 Nov 2008 13:20

Re: Bank of Montreal (Symbol-BMO)

Post by poedin »

Financial Post news banner
Live news: BMO closing retail auto finance business as borrowers' bad debt mounts
The details, it's their indirect auto loans department that is shutting down, which
works with car dealerships to arrange financing for car buyers, who in turn make monthly payments to the lender — the bank.
Post Reply