TORONTO — BMO Financial Group reported a second-quarter profit of $689 million, down from $1.5 billion a year ago, as it increased the amount set aside for bad loans due to the pandemic.
The bank said Wednesday its total provision for credit losses for the quarter was $1.11 billion, up from $176 million in the same quarter last year.
However, BMO still reported a profit of $1.00 per share for the quarter ended April 30 compared with a profit of $2.26 per share a year earlier.
BMO chief executive Darryl White said the full scope and scale of the of the pandemic remains uncertain, but the bank is well positioned to face the challenges.
"For the second quarter, we demonstrated the resilience of our earnings power as we earned through the impact of market volatility and prudent loan loss provisioning," White said.
"As we transition to the reopening of our economies, we will sustain and adapt operations to support our customers, employees, communities and the broader economic recovery, and together emerge from this crisis even stronger."
On an adjusted basis, BMO says it had a profit of $1.04 per share for the quarter compared with an adjusted profit of $2.30 per share a year ago.
Analysts on average had expected an adjusted profit of $1.22 per share for the quarter, according to financial markets data firm Refinitiv.
BMO said its provision for credit losses on impaired loans was $413 million, up from $150 million a year ago, while the provision for credit losses on performing loans totalled $705 million due to the weaker economic outlook.
The bank said it Canadian personal and commercial banking business earned $361 million for the quarter, down from $616 million a year ago due to the higher provisions for credit losses, while higher revenue was partially offset by higher expenses.
In the U.S., the bank's personal and commercial banking operations earned $339 million, compared with $406 million in same quarter a year ago.
BMO's wealth management division earned $144 million, compared with $305 million a year ago, while its capital markets operations lost $74 million, compared a profit of $250 million in the same quarter last year.
Results at the bank's corporate services group was relatively unchanged at a loss of $81 million, compared a loss of $80 million a year ago.
This report by The Canadian Press was first published May 27, 2020.
Companies in this story: (TSX:BMO)
The Canadian Press
