Bank of Montreal profits fall and brace for bad debts
The Bank of Montreal said on Wednesday that its profits fell sharply in the last quarter after setting aside nearly an additional C $ 1 billion to fortify itself against borrowers affected by the coronavirus pandemic.
The Montreal, Canada-based bank reported second quarter profit of C $ 689 million ($ 501 million), or C $ 1.00 per share, from C $ 1.5 billion, or 2 , C $ 26 per share, a year ago.
Adjusted earnings were C $ 1.04 per share, below the C $ 1.22 analysts polled by FactSet were expecting.
The bank reported revenues of C $ 5.26 billion in the quarter, down sharply from C $ 6.21 billion a year earlier. This was lower than analysts’ forecast of C $ 5.95 billion.
The lender said it set aside C $ 1.12 billion to cover loan losses, an increase of more than six times from C $ 176 million a year ago.
“We have demonstrated the resilience of our earning capacity through the impact of market volatility and prudent provisioning for loan losses,” said Darryl White, CEO of BMO Financial Group, in prepared remarks.
The bank said it remained “very uncertain” to what extent the coronavirus pandemic would affect its future profits.
Write to Dieter Holger at [email protected]; @dieterholger