Financial Data and Key Metrics Changes - Third quarter earnings per share increased by 22% to $3.23, with net income of $2.4 billion, marking the second highest quarter on record [5] - Pre-provision pre-tax earnings rose by 13% to $4 billion, with a return on equity improving to 12% for the quarter [6][7] - Year-to-date revenue growth was 12%, and pre-provision pre-tax earnings increased by 19%, achieving positive operating leverage of 4.7% for six consecutive quarters [7][21] Business Line Data and Key Metrics Changes - Canadian Personal Banking saw strong customer growth, with checking account growth nearly double the industry benchmark, and deposits in the savings amplifier account surpassed $12 billion [12] - Canadian Commercial Banking experienced broad-based loan and deposit growth, with fee revenue from integrated treasury and payment solutions up 23% year-to-date [13] - U.S. Personal and Commercial Banking reported a 42% increase in net income, driven by strong pre-provision pre-tax earnings growth of 10% [31] - BMO Wealth Management achieved a 21% increase in net income, supported by strong revenue growth in wealth and asset management [35] - BMO Capital Markets net income rose by 12%, with revenue up 7% due to strong performance in global markets and higher trading revenue [36] Market Data and Key Metrics Changes - Average loans grew by 2% year-over-year, driven by residential mortgages and commercial loans in Canada, while U.S. commercial loans declined due to muted loan demand [25] - Customer deposits increased by 3% from last year, with growth in Canadian everyday banking and commercial operating balances [26] - Net interest income (excluding trading) was up 9% year-over-year, with net interest margin expanding by 16 basis points [27] Company Strategy and Development Direction - The company is focused on executing its ROE rebuild strategies, with a medium-term target of 15% for BMO and 12% for U.S. Personal and Commercial Banking [23] - Recent organizational changes in U.S. Banking aim to enhance performance by integrating personal, commercial, and wealth management businesses [10] - The acquisition of Burgundy Asset Management is expected to expand BMO's wealth management capabilities [17] Management's Comments on Operating Environment and Future Outlook - Management noted that while trade-related risks have eased, geopolitical challenges persist, and the Canadian economy is experiencing modest growth [8] - The U.S. economy remains resilient, supported by strong corporate earnings and consumer spending, which should aid growth in 2026 [9] - Management expressed confidence in achieving targets despite uncertainties in the economic environment, particularly in Canada [72] Other Important Information - The CET1 ratio remained strong at 13.5%, with share buybacks ongoing to return excess capital to shareholders [6][30] - The company is investing in digital and AI capabilities to enhance client services and operational efficiency [19] Q&A Session Summary Question: U.S. Loan and Revenue Growth Outlook - Management indicated that while there are macro factors affecting loan growth, they remain comfortable with their position and expect to grow at or above market rates [50][52] Question: Recovery on Performing Loans - Management noted that the recovery in performing loans is driven by improved macroeconomic forecasts and stabilization in portfolio quality, particularly in the U.S. [61][62] Question: Canadian Economic Outlook - Management described the Canadian economy as experiencing modest growth, with expectations of 1% to 1.5% growth in the latter half of the year [70][71] Question: Operating Leverage Expectations - Management confirmed their commitment to achieving positive operating leverage and efficiency improvements, aiming for a continued positive trend [100][101] Question: Credit Migration Speed - Management highlighted that improvements in credit migration are due to strong risk management practices and a favorable economic environment, particularly in the U.S. [102][105]