BMO Financial Group accelerates North American growth with strategic acquisition of Bank of the West
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Expansion to major new U.S. geographies, including highly attractive California market, a natural next step in BMO's North American growth strategy
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Financially compelling; funded primarily with existing capital in BMO and Bank of the West; transaction is immediately accretive at closing to adjusted earnings per share and drives long term growth
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Combination with Bank of the West will provide a highly complementary footprint and capabilities to help more consumers and businesses make real financial progress and break down barriers to economic inclusion
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BMO is committed to retaining front-line branch employees with no planned closure of Bank of the West branches in connection with the transaction
TORONTO and CHICAGO, Dec. 20, 2021 /CNW/ - BMO Financial Group (TSX: BMO) (NYSE: BMO), and its indirect wholly-owned Chicago-based subsidiary BMO Harris Bank N.A. (together, "BMO"), today announced the signing of a definitive agreement with BNP Paribas (XPAR: BNP) to acquire Bank of the West and its subsidiaries, with assets as of September 30, 2021 of approximately C$135 billion (US$105 billion). This acquisition aligns with BMO's strategic, financial and cultural objectives.
Under the terms of the agreement, BMO will acquire Bank of the West for a cash purchase price of US$16.3 billion, or US$13.4 billion net of estimated US$2.9 billion of excess capital (at closing) at Bank of the West. BMO will fund the transaction primarily with excess capital reflecting its strong capital position and anticipated capital generation.
Founded in 1874, Bank of the West has a strong track record of serving retail, small business, commercial and wealth clients. With the combination of two highly complementary geographies and building upon BMO's digital, data and analytics capabilities, this acquisition enables contiguous market extension, the acceleration of BMO's commercial banking expansion, and highly competitive scaled entry into California.
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.
"With the strength of our performance and our integrated North American foundation, we have never been better positioned to take this next step in our growth strategy and to deliver for the new customers and colleagues we look forward to welcoming to BMO. This acquisition will add meaningful scale, expansion in attractive markets, and capabilities that will enable us to drive greater growth, returns and efficiencies," said Darryl White, Chief Executive Officer, BMO Financial Group.
"We will deliver a highly competitive offering to new growth markets, combining the strength of our digital banking platform and a strong team of bankers to generate leading customer growth."
"Breaking down barriers to inclusion is a driving force for both banks – it's a commitment central to BMO's Purpose, to Boldly Grow the Good in business and life. Both BMO and Bank of the West have achieved "Outstanding" Community Reinvestment Act ratings, supported by robust commitments to investing in our communities. We'll be well positioned to support the communities we serve and to help our customers make real financial progress," concluded Mr. White.
"Bank of the West is a well-run and well-respected organization that will bring complementary capabilities, products and segment expertise to BMO, all of which are accretive to our existing franchise," said David Casper, Group Head, North American Commercial Banking and U.S. Chief Executive Officer, BMO Financial Group. "Combining these strengths with BMO's proven track record of executing and integrating acquisitions will position us to leverage our capabilities to serve more personal, business, commercial and wealth customers. It's also a great opportunity to build upon our strong track record of engaging with communities where we operate."
"On behalf of all of my colleagues at Bank of the West, I am excited for what this new opportunity will bring for our customers, our employees and our longstanding community partners. Bank of the West's presence in many of the largest and fastest growing markets in the U.S. provides an ideal and complementary commercial and retail banking platform to fuel BMO's growth. Combined with BMO's suite of products and capabilities we'll be able to help even more customers achieve real financial progress. Our team of dedicated commercial and business bankers will be a great fit with BMO, working on creative solutions to match individual needs," said Bank of the West CEO Nandita Bakhshi.
Transaction Highlights
The transaction is expected to be immediately accretive on closing to BMO's adjusted earnings per share and over 10% accretive in 2024, including estimated cost synergies. The estimated internal rate of return is approximately 14%. The purchase price is estimated at 1.5 times Bank of the West's expected tangible common book value based on the estimated balance sheet at close. BMO expects to incur pre-tax merger and integration costs of approximately C$1.7 billion and achieve pre-tax cost savings of approximately C$860 million, or 35% of Bank of the West's non-interest expenses, through operational efficiency improvements with 100% of the cost savings executed by the end of the first year after closing.
The acquisition adds approximately US$56 billion of loans and US$89 billion of deposits based on Bank of the West's September 30, 2021 balance sheet. BMO expects to take a gross credit mark of C$992 million, or 126 bps of loans and reflect a C$218 million fair value mark (write-down of equity), both of which will be accreted into adjusted earnings.
BMO expects to fund the transaction primarily through excess capital on the combined entities balance sheet at closing, including an estimated C$3.8 billion from Bank of the West and C$13.5 billion from BMO, which includes the benefit from the sale of BMO's EMEA asset management business and internal capital generation to the estimated closing date. In addition, BMO intends to introduce a 2% discount on shares issued under its dividend reinvestment plan (DRIP) and expects to raise approximately C$2.7 billion of common equity prior to the closing date. BMO is committed to maintaining its target capital ratios and regular dividends within its target payout range. BMO will not proceed with establishing a normal course issuer bid and does not expect to repurchase shares prior to close.
A signature strength of the Bank of the West is the deep relationships formed between their employees, their customers and the communities they have served for over 100 years. As part of this transaction, BMO does not plan to close Bank of the West branches, is committed to retaining front-line Bank of the West branch employees, and enabling career development opportunities throughout BMO's North American footprint.
BMO and BNP Paribas will enter into a long-term distribution agreement for the provision of Equipment Finance and Cash Management solutions to BNP Paribas' customers in North America.
The transaction, which has been approved by the BMO and BNP Paribas Boards of Directors, is expected to close by the end of calendar 2022, subject to customary closing conditions, including regulatory approvals. Upon closing, BMO intends to merge Bank of the West into BMO Harris Bank N.A.
Shared Commitment to Employees, Consumers, Small Businesses, Underserved Communities and the Environment
BMO's Purpose, to Boldly Grow the Good in business and life, including commitments to a Thriving Economy, a Sustainable Future and Eliminating Barriers to Inclusion drives everything we do. It shapes our business strategies, product development, customer relationships and community engagement. Through BMO EMpower, BMO has committed US$5B over five years to address key barriers faced by minority businesses, communities and families in the U.S. by lending, investing, giving and engaging with communities it serves. BMO is also helping its customers make real financial progress through its offerings including new products like Bank On-certified Smart Money, a low-fee checking account with no overdraft or NSF fees. BMO looks forward to continuing the robust community engagement it's well known for.
With BMO's recognition as one of the world's most sustainably managed companies and Bank of the West's impressive sustainability platform and ESG track record, the transaction provides significant opportunities for collaboration in ESG investing and product innovation. Both companies have been named as leading U.S. employers by Forbes and are committed to creating purpose-driven workplace cultures motivated to win and support the communities they serve.
Advisors
BMO Capital Markets and Morgan Stanley & Co. LLC acted as financial advisors and Wachtell, Lipton, Rosen & Katz and Osler, Hoskin & Harcourt LLP acted as legal counsel to BMO.
Investor Call
An investor call will take place December 20, 2021 at 8:00 am ET. BMO executives will discuss the transaction, followed by Q&A. The call can be accessed via webcast at www.bmo.com/investorrelations. Alternatively, there will be a listen-only number at 1 (800) 898-3989 or (416) 406-0743 (6578095#). Presentation material referenced during the conference call will be available at www.bmo.com/investorrelations.
A rebroadcast of this presentation will be available until midnight ET, January 14, 2022, by calling 1 (800) 408-3053 or (905) 694-9451 and entering passcode 7155620#.
About BMO Financial Group
Serving customers for 200 years and counting, BMO is a highly diversified financial services provider - the 8th largest bank, by assets, in North America. With total assets of $988 billion as of October 31, 2021, and a team of diverse and highly engaged employees, BMO provides a broad range of personal and commercial banking, wealth management and investment banking products and services to more than 12 million customers and conducts business through three operating groups: Personal and Commercial Banking, BMO Wealth Management and BMO Capital Markets.
About Bank of the West
Headquartered in San Francisco, Bank of the West operates more than 500 branches and offices in 24 states (primarily in the Western and Midwestern parts of the United States), employs more than 9,000 team members, and serves nearly 1.8 million customers. Bank of the West has a total balance sheet size of US$105 billion in assets and US$89 billion in deposits as of end September 30, 2021.
As of June 2021, Bank of the West has a deposit market share of approximately 3% in the top three states (California, Colorado, and Oregon), which account for over 80% of its deposits. Bank of the West markets a very broad range of retail banking products and services to individuals, small businesses and corporate clients. It also has strong positions across the United States in several specialised financing activities, such as marine, recreational vehicles, and agribusiness. To learn more about Bank of the West, visit About Us via BankoftheWest.com.
Cautionary statement regarding forward-looking information
Certain statements in this press release are forward-looking statements. All such statements are made pursuant to the "safe harbor" provisions of, and are intended to be forward-looking statements under, the United States Private Securities Litigation Reform Act of 1995 and any applicable Canadian securities legislation. Forward-looking statements in this document may include, but are not limited to, statements with respect to the expected closing of the proposed transaction, plans for the combined operations of BMO and Bank of the West, the financing of the proposed transaction, the financial, operational and capital impacts of the proposed transaction, our strategies or future actions, our targets and commitments, expectations for our financial condition, capital position, the regulatory environment in which we operate, the results of, or outlook for, our operations or for the Canadian and U.S. economies, and include statements made by our management. Forward-looking statements are typically identified by words such as "will", "would", "should", "believe", "expect", "anticipate", "project", "intend", "estimate", "plan", "goal", "commit", "target", "may", "might", "schedule", "forecast" and "could" or negative or grammatical variations thereof.
By their nature, forward-looking statements require us to make assumptions and are subject to inherent risks and uncertainties, both general and specific in nature. There is significant risk that predictions, forecasts, conclusions or projections will not prove to be accurate, that our assumptions may not be correct, and that actual results may differ materially from such predictions, forecasts, conclusions or projections. The uncertainty created by the COVID-19 pandemic has heightened this risk, given the increased challenge in making assumptions, predictions, forecasts, conclusions or projections. We caution readers of this document not to place undue reliance on our forward-looking statements, as a number of factors – many of which are beyond our control and the effects of which can be difficult to predict – could cause actual future results, conditions, actions or events to differ materially from the targets, expectations, estimates or intentions expressed in the forward-looking statements.
The future outcomes that relate to forward-looking statements may be influenced by many factors, including, but not limited to: the possibility that the proposed transaction does not close when expected or at all because required regulatory approvals and other conditions to closing are not received or satisfied on a timely basis or at all or are received subject to adverse conditions or requirements; the anticipated benefits from the proposed transaction, such as it being accretive to adjusted earnings per share, ("EPS"), creating synergy opportunities and growing our U.S. operations are not realized in the time frame anticipated or at all as a result of changes in general economic and market conditions, interest and exchange rates, monetary policy, laws and regulations (including changes to capital requirements) and their enforcement, and the degree of competition in the geographic and business areas in which Bank of the West currently operates; the business of Bank of the West may not perform as expected or in a manner consistent with historical performance; the ability to promptly and effectively integrate Bank of the West; the ability to fund the proposed transaction from existing excess capital and anticipated capital generation and financing transactions on terms acceptable to BMO; BMO's ability to achieve it's capital targets; BMO's ability to cross-sell more products to customers; reputational risks and the reaction of Bank of the West's customers and employees to the transaction; diversion of management time on transaction-related issues; increased exposure to exchange rate fluctuations; and those other factors discussed in the Risks That May Affect Future Results section, and the sections related to credit and counterparty, market, insurance, liquidity and funding, operational non-financial, legal and regulatory, strategic, environmental and social, and reputation risk, in the Enterprise-Wide Risk Management section of BMO's 2021 Annual Report, all of which outline certain key factors and risks that may affect our future results and our ability to anticipate and effectively manage risks arising from all of the foregoing factors. We caution that the foregoing list is not exhaustive of all possible factors. Other factors and risks could adversely affect our results. Investors and others should carefully consider these factors and risks, as well as other uncertainties and potential events, and the inherent uncertainty of forward-looking statements.
Assumptions about BMO and Bank of the West's current and expected financial performance (including balance sheet, income statement and regulatory capital figures), expected financing for the proposed transaction (including participation in BMO's DRIP), expected closing date of the proposed transaction, expected synergies (and timing to achieve), integration and restructuring costs, assumed purchase price accounting (including fair value marks), costs of financing, foreign exchange rates, our assumed terminal value multiple, and future regulatory capital requirements, including the Office of the Superintendent of Financial Institutions' announced Basel III reforms effective in the second quarter of fiscal 2023, were considered in estimating the internal rate of return to BMO, adjusted EPS accretion and /or BMO's expected regulatory capital ratios.
Assumptions about our integration plan, the efficiency and duration of integration and the alignment of organizational responsibilities were material factors we considered in estimating transaction and integration costs.
We do not undertake to update any forward-looking statements, whether written or oral, that may be made from time to time by the organization or on its behalf, except as required by law. The forward-looking information contained in this document is presented for the purpose of assisting shareholders and analysts in understanding the proposed transaction and may not be appropriate for other purposes.
SOURCE BMO Financial Group
For further information: Media Contacts: Paul Gammal, Toronto, paul.gammal@bmo.com, (416) 867-3996; Investor Relations Contacts: Christine Viau, Toronto, christine.viau@bmo.com, (416) 867-6956; Bill Anderson, Toronto, bill2.anderson@bmo.com, (416) 867-7834; Internet: www.bmo.com; Twitter: @BMOmedia
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Expansion to major new U.S. geographies, including highly attractive California market, a natural next step in BMO's North American growth strategy
-
Financially compelling; funded primarily with existing capital in BMO and Bank of the West; transaction is immediately accretive at closing to adjusted earnings per share and drives long term growth
-
Combination with Bank of the West will provide a highly complementary footprint and capabilities to help more consumers and businesses make real financial progress and break down barriers to economic inclusion
-
BMO is committed to retaining front-line branch employees with no planned closure of Bank of the West branches in connection with the transaction
TORONTO and CHICAGO, Dec. 20, 2021 /CNW/ - BMO Financial Group (TSX: BMO) (NYSE: BMO), and its indirect wholly-owned Chicago-based subsidiary BMO Harris Bank N.A. (together, "BMO"), today announced the signing of a definitive agreement with BNP Paribas (XPAR: BNP) to acquire Bank of the West and its subsidiaries, with assets as of September 30, 2021 of approximately C$135 billion (US$105 billion). This acquisition aligns with BMO's strategic, financial and cultural objectives.
Under the terms of the agreement, BMO will acquire Bank of the West for a cash purchase price of US$16.3 billion, or US$13.4 billion net of estimated US$2.9 billion of excess capital (at closing) at Bank of the West. BMO will fund the transaction primarily with excess capital reflecting its strong capital position and anticipated capital generation.
Founded in 1874, Bank of the West has a strong track record of serving retail, small business, commercial and wealth clients. With the combination of two highly complementary geographies and building upon BMO's digital, data and analytics capabilities, this acquisition enables contiguous market extension, the acceleration of BMO's commercial banking expansion, and highly competitive scaled entry into California.
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.
"With the strength of our performance and our integrated North American foundation, we have never been better positioned to take this next step in our growth strategy and to deliver for the new customers and colleagues we look forward to welcoming to BMO. This acquisition will add meaningful scale, expansion in attractive markets, and capabilities that will enable us to drive greater growth, returns and efficiencies," said Darryl White, Chief Executive Officer, BMO Financial Group.
"We will deliver a highly competitive offering to new growth markets, combining the strength of our digital banking platform and a strong team of bankers to generate leading customer growth."
"Breaking down barriers to inclusion is a driving force for both banks – it's a commitment central to BMO's Purpose, to Boldly Grow the Good in business and life. Both BMO and Bank of the West have achieved "Outstanding" Community Reinvestment Act ratings, supported by robust commitments to investing in our communities. We'll be well positioned to support the communities we serve and to help our customers make real financial progress," concluded Mr. White.
"Bank of the West is a well-run and well-respected organization that will bring complementary capabilities, products and segment expertise to BMO, all of which are accretive to our existing franchise," said David Casper, Group Head, North American Commercial Banking and U.S. Chief Executive Officer, BMO Financial Group. "Combining these strengths with BMO's proven track record of executing and integrating acquisitions will position us to leverage our capabilities to serve more personal, business, commercial and wealth customers. It's also a great opportunity to build upon our strong track record of engaging with communities where we operate."
"On behalf of all of my colleagues at Bank of the West, I am excited for what this new opportunity will bring for our customers, our employees and our longstanding community partners. Bank of the West's presence in many of the largest and fastest growing markets in the U.S. provides an ideal and complementary commercial and retail banking platform to fuel BMO's growth. Combined with BMO's suite of products and capabilities we'll be able to help even more customers achieve real financial progress. Our team of dedicated commercial and business bankers will be a great fit with BMO, working on creative solutions to match individual needs," said Bank of the West CEO Nandita Bakhshi.
Transaction Highlights
The transaction is expected to be immediately accretive on closing to BMO's adjusted earnings per share and over 10% accretive in 2024, including estimated cost synergies. The estimated internal rate of return is approximately 14%. The purchase price is estimated at 1.5 times Bank of the West's expected tangible common book value based on the estimated balance sheet at close. BMO expects to incur pre-tax merger and integration costs of approximately C$1.7 billion and achieve pre-tax cost savings of approximately C$860 million, or 35% of Bank of the West's non-interest expenses, through operational efficiency improvements with 100% of the cost savings executed by the end of the first year after closing.
The acquisition adds approximately US$56 billion of loans and US$89 billion of deposits based on Bank of the West's September 30, 2021 balance sheet. BMO expects to take a gross credit mark of C$992 million, or 126 bps of loans and reflect a C$218 million fair value mark (write-down of equity), both of which will be accreted into adjusted earnings.
BMO expects to fund the transaction primarily through excess capital on the combined entities balance sheet at closing, including an estimated C$3.8 billion from Bank of the West and C$13.5 billion from BMO, which includes the benefit from the sale of BMO's EMEA asset management business and internal capital generation to the estimated closing date. In addition, BMO intends to introduce a 2% discount on shares issued under its dividend reinvestment plan (DRIP) and expects to raise approximately C$2.7 billion of common equity prior to the closing date. BMO is committed to maintaining its target capital ratios and regular dividends within its target payout range. BMO will not proceed with establishing a normal course issuer bid and does not expect to repurchase shares prior to close.
A signature strength of the Bank of the West is the deep relationships formed between their employees, their customers and the communities they have served for over 100 years. As part of this transaction, BMO does not plan to close Bank of the West branches, is committed to retaining front-line Bank of the West branch employees, and enabling career development opportunities throughout BMO's North American footprint.
BMO and BNP Paribas will enter into a long-term distribution agreement for the provision of Equipment Finance and Cash Management solutions to BNP Paribas' customers in North America.
The transaction, which has been approved by the BMO and BNP Paribas Boards of Directors, is expected to close by the end of calendar 2022, subject to customary closing conditions, including regulatory approvals. Upon closing, BMO intends to merge Bank of the West into BMO Harris Bank N.A.
Shared Commitment to Employees, Consumers, Small Businesses, Underserved Communities and the Environment
BMO's Purpose, to Boldly Grow the Good in business and life, including commitments to a Thriving Economy, a Sustainable Future and Eliminating Barriers to Inclusion drives everything we do. It shapes our business strategies, product development, customer relationships and community engagement. Through BMO EMpower, BMO has committed US$5B over five years to address key barriers faced by minority businesses, communities and families in the U.S. by lending, investing, giving and engaging with communities it serves. BMO is also helping its customers make real financial progress through its offerings including new products like Bank On-certified Smart Money, a low-fee checking account with no overdraft or NSF fees. BMO looks forward to continuing the robust community engagement it's well known for.
With BMO's recognition as one of the world's most sustainably managed companies and Bank of the West's impressive sustainability platform and ESG track record, the transaction provides significant opportunities for collaboration in ESG investing and product innovation. Both companies have been named as leading U.S. employers by Forbes and are committed to creating purpose-driven workplace cultures motivated to win and support the communities they serve.
Advisors
BMO Capital Markets and Morgan Stanley & Co. LLC acted as financial advisors and Wachtell, Lipton, Rosen & Katz and Osler, Hoskin & Harcourt LLP acted as legal counsel to BMO.
Investor Call
An investor call will take place December 20, 2021 at 8:00 am ET. BMO executives will discuss the transaction, followed by Q&A. The call can be accessed via webcast at www.bmo.com/investorrelations. Alternatively, there will be a listen-only number at 1 (800) 898-3989 or (416) 406-0743 (6578095#). Presentation material referenced during the conference call will be available at www.bmo.com/investorrelations.
A rebroadcast of this presentation will be available until midnight ET, January 14, 2022, by calling 1 (800) 408-3053 or (905) 694-9451 and entering passcode 7155620#.
About BMO Financial Group
Serving customers for 200 years and counting, BMO is a highly diversified financial services provider - the 8th largest bank, by assets, in North America. With total assets of $988 billion as of October 31, 2021, and a team of diverse and highly engaged employees, BMO provides a broad range of personal and commercial banking, wealth management and investment banking products and services to more than 12 million customers and conducts business through three operating groups: Personal and Commercial Banking, BMO Wealth Management and BMO Capital Markets.
About Bank of the West
Headquartered in San Francisco, Bank of the West operates more than 500 branches and offices in 24 states (primarily in the Western and Midwestern parts of the United States), employs more than 9,000 team members, and serves nearly 1.8 million customers. Bank of the West has a total balance sheet size of US$105 billion in assets and US$89 billion in deposits as of end September 30, 2021.
As of June 2021, Bank of the West has a deposit market share of approximately 3% in the top three states (California, Colorado, and Oregon), which account for over 80% of its deposits. Bank of the West markets a very broad range of retail banking products and services to individuals, small businesses and corporate clients. It also has strong positions across the United States in several specialised financing activities, such as marine, recreational vehicles, and agribusiness. To learn more about Bank of the West, visit About Us via BankoftheWest.com.
Cautionary statement regarding forward-looking information
Certain statements in this press release are forward-looking statements. All such statements are made pursuant to the "safe harbor" provisions of, and are intended to be forward-looking statements under, the United States Private Securities Litigation Reform Act of 1995 and any applicable Canadian securities legislation. Forward-looking statements in this document may include, but are not limited to, statements with respect to the expected closing of the proposed transaction, plans for the combined operations of BMO and Bank of the West, the financing of the proposed transaction, the financial, operational and capital impacts of the proposed transaction, our strategies or future actions, our targets and commitments, expectations for our financial condition, capital position, the regulatory environment in which we operate, the results of, or outlook for, our operations or for the Canadian and U.S. economies, and include statements made by our management. Forward-looking statements are typically identified by words such as "will", "would", "should", "believe", "expect", "anticipate", "project", "intend", "estimate", "plan", "goal", "commit", "target", "may", "might", "schedule", "forecast" and "could" or negative or grammatical variations thereof.
By their nature, forward-looking statements require us to make assumptions and are subject to inherent risks and uncertainties, both general and specific in nature. There is significant risk that predictions, forecasts, conclusions or projections will not prove to be accurate, that our assumptions may not be correct, and that actual results may differ materially from such predictions, forecasts, conclusions or projections. The uncertainty created by the COVID-19 pandemic has heightened this risk, given the increased challenge in making assumptions, predictions, forecasts, conclusions or projections. We caution readers of this document not to place undue reliance on our forward-looking statements, as a number of factors – many of which are beyond our control and the effects of which can be difficult to predict – could cause actual future results, conditions, actions or events to differ materially from the targets, expectations, estimates or intentions expressed in the forward-looking statements.
The future outcomes that relate to forward-looking statements may be influenced by many factors, including, but not limited to: the possibility that the proposed transaction does not close when expected or at all because required regulatory approvals and other conditions to closing are not received or satisfied on a timely basis or at all or are received subject to adverse conditions or requirements; the anticipated benefits from the proposed transaction, such as it being accretive to adjusted earnings per share, ("EPS"), creating synergy opportunities and growing our U.S. operations are not realized in the time frame anticipated or at all as a result of changes in general economic and market conditions, interest and exchange rates, monetary policy, laws and regulations (including changes to capital requirements) and their enforcement, and the degree of competition in the geographic and business areas in which Bank of the West currently operates; the business of Bank of the West may not perform as expected or in a manner consistent with historical performance; the ability to promptly and effectively integrate Bank of the West; the ability to fund the proposed transaction from existing excess capital and anticipated capital generation and financing transactions on terms acceptable to BMO; BMO's ability to achieve it's capital targets; BMO's ability to cross-sell more products to customers; reputational risks and the reaction of Bank of the West's customers and employees to the transaction; diversion of management time on transaction-related issues; increased exposure to exchange rate fluctuations; and those other factors discussed in the Risks That May Affect Future Results section, and the sections related to credit and counterparty, market, insurance, liquidity and funding, operational non-financial, legal and regulatory, strategic, environmental and social, and reputation risk, in the Enterprise-Wide Risk Management section of BMO's 2021 Annual Report, all of which outline certain key factors and risks that may affect our future results and our ability to anticipate and effectively manage risks arising from all of the foregoing factors. We caution that the foregoing list is not exhaustive of all possible factors. Other factors and risks could adversely affect our results. Investors and others should carefully consider these factors and risks, as well as other uncertainties and potential events, and the inherent uncertainty of forward-looking statements.
Assumptions about BMO and Bank of the West's current and expected financial performance (including balance sheet, income statement and regulatory capital figures), expected financing for the proposed transaction (including participation in BMO's DRIP), expected closing date of the proposed transaction, expected synergies (and timing to achieve), integration and restructuring costs, assumed purchase price accounting (including fair value marks), costs of financing, foreign exchange rates, our assumed terminal value multiple, and future regulatory capital requirements, including the Office of the Superintendent of Financial Institutions' announced Basel III reforms effective in the second quarter of fiscal 2023, were considered in estimating the internal rate of return to BMO, adjusted EPS accretion and /or BMO's expected regulatory capital ratios.
Assumptions about our integration plan, the efficiency and duration of integration and the alignment of organizational responsibilities were material factors we considered in estimating transaction and integration costs.
We do not undertake to update any forward-looking statements, whether written or oral, that may be made from time to time by the organization or on its behalf, except as required by law. The forward-looking information contained in this document is presented for the purpose of assisting shareholders and analysts in understanding the proposed transaction and may not be appropriate for other purposes.
SOURCE BMO Financial Group
For further information: Media Contacts: Paul Gammal, Toronto, paul.gammal@bmo.com, (416) 867-3996; Investor Relations Contacts: Christine Viau, Toronto, christine.viau@bmo.com, (416) 867-6956; Bill Anderson, Toronto, bill2.anderson@bmo.com, (416) 867-7834; Internet: www.bmo.com; Twitter: @BMOmedia
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BMO Financial Group Increases Common Share Dividend by 4 cents from the prior quarter, up 6 per cent from the prior year
BMO Named to UN-Convened Group Providing Guidance to Global Banks on Nature Target Setting
Global Food and Agriculture Trends and Outlook: BMO Hosts 18th Farm to Market | Chemicals Conference in New York
BMO Celebrates Earth Day with 3rd Annual Trees from Trades Day on its Global Trading Floors
BMO Capital Markets CEO Dan Barclay named Male Ally of the Year by Financial Women's Association
BMO Ranked North America's Most Sustainable Bank by Corporate Knights for Fourth Consecutive Year
BMO ranked one of the most sustainable companies in North America on the Dow Jones Sustainability Indices
Top Rankings for BMO Capital Markets' FICC Macro Strategy Group in Institutional Investor Client Survey
BMO Climate Institute Survey Shows Costs and Competing Priorities Slowing Climate Action for Small and Mid-Sized Businesses
BMO Financial Group Increases Common Share Dividend by 4 cents from the prior quarter, up 8 per cent from the prior year
BMO the Top Ranked Financial Institution on New Global Sustainability Benchmark Announced at COP 27
The Government of Canada announces the issuance of a Ukraine Sovereignty Bond
BMO to Invest in Innovative Carbon Offsets from CarbonCure to Permanently Store CO2
The Financial Women's Association Underscores Its Commitment to the Back2Business™ Return-to-Work Program
A Canadian First: BMO and Concordia University Partner for a Sustainable Future with Innovative Sustainability-Linked Loan
BMO's 18th Global Equity Through Education Trading Day Raises C$1.65 Million for Education and Development of Students in Need
BMO Capital Markets Trading Floors in Toronto, New York and London Promote Equity Through Education for 18th Year to Provide Financial Aid to Students
BMO to Acquire Calgary-based Radicle Group Inc., a Leader in Environmental Services
BMO Financial Group Increases Common Share Dividend by 6 cents from the prior quarter, up 31 per cent from the prior year
BMO Expands Electronic Trading Operations for Institutions and Broker Dealers to EMEA Markets
BMO and EDC Announce Collaboration to Introduce Sustainable Finance Solutions for Canadian Businesses
BMO joins leading US banks in support of Ownership Works, to help create wealth for working families through employee ownership programs
BMO proud to support first Government of Canada Green Bond transaction as joint-lead manager
BMO Supports Women Entrepreneurs in Canada with $5 Billion in Capital to Mark International Women’s Day 2022
BMO Launches Business Within Reach: BMO for Black Entrepreneurs and Commits $100 million in loans to Help Black-led Businesses Start up, Scale up, and Grow
BMO Announces Plan to Partner with Breakthrough Energy Catalyst to Accelerate Climate Innovation
BMO Financial Group Named North America's Most Sustainable Bank for Third Consecutive Year
BMO Capital Markets Named Best Canadian Bank for USD/CAD for 11th Consecutive Year
BMO Financial Group Announces Intention to Repurchase Up to 22.5 Million of its Common Shares
BMO Financial Group Increases Common Share Dividend by 27 cents from the prior quarter, up 25 per cent from the prior quarter and prior year
BMO Helps Boralex Go Beyond Renewable Energy, with the Transition of its Credit Facility to a Sustainability-Linked Loan
BMO Capital Markets' Fixed Income Strategy Group Earns Top Rankings in Institutional Investor Survey
BMO First Bank to Pre-Purchase Direct Air Capture Carbon Removals using Carbon Engineering technology
A Global First: BMO Supports Bruce Power with World's First Nuclear Green Financing Framework
BMO ranked one of the most sustainable companies in the world according to Dow Jones Sustainability Indices
BMO Celebrates International Day of the Girl 2021 - Participates in New Sustainability Innovation Hub to Inspire Young Women
North American Metals & Mining first: BMO helps Sandstorm Gold Royalties achieve ESG goals with Sustainability-Linked Loan
BMO marks National Day for Truth and Reconciliation with $600,000 in donations to Indigenous organizations across Canada
Education, Employment and Economic Empowerment: BMO Releases Wîcihitowin ᐑᒋᐦᐃᑐᐏᐣ- First Annual Indigenous Partnerships and Progress Report
BMO's 17th Annual Equity Through Education Trading Day Raises C$1.6 Million to Promote Diversity, Equity and Inclusion
Media Advisory - BMO Celebrates 17 Years of Promoting Diversity and Inclusion Through BMO Capital Markets' Equity Through Education Trading Day
BMO Harnesses AI Technology for Capital Markets Structured Note Pricing and Scenario Analysis
BMO Announces $12 Billion Financing Commitment towards Affordable Housing in Canada
BMO supports Canada's bid to host the headquarters of the International Sustainability Standards Board
BMO Named to Canada's Best 50 Corporate Citizens Ranking by Corporate Knights
Bringing Indigenous Perspectives to Canadians: First Nations University of Canada, Reconciliation Education and BMO launch new eLearning to mark National Indigenous History Month
The Future of Food & Agriculture: BMO Hosts World-Leading Farm to Market Conference for 16th Consecutive Year
Rush University System for Health and BMO Financial Group Announce $10 Million Donation to Create the Rush BMO Institute for Health Equity
BMO Shares Progress on IFC led Operating Principles for Impact Management in First Disclosure Statement
BMO Announces $250,000 Donation to Organizations Supporting Global Emergency COVID-19 Relief Efforts
A North American First: BMO Helps Gibson Energy Fully Transition Credit Facility to a Sustainability-Linked Loan
Forbes names BMO Harris Bank one of the Best Employers for Diversity 2021 for the third year in a row
BMO Issues C$750 million Women in Business Bond In Support of Women-Owned Businesses
BMO Commits $1.2 Million to SheEO Programs Helping Women-Led Venture Companies Access Financing
BMO Named One of the World's Most Ethical Companies by the Ethisphere Institute for the Fourth Year in a Row
BMO Financial Group among first Canadian banks to sign United Nations Principles for Responsible Banking
BMO Financial Group ranked top bank in North America on Corporate Knights' 2021 Global 100 Most Sustainable Corporations in the World
BMO Financial Group 2020 Sustainability Report and Public Accountability Statement Now Available Online
BMO Capital Markets Named Best Canadian Bank for USD/CAD for 10th Consecutive Year
BMO Ranked Among Most Sustainable Companies on Dow Jones Sustainability Index - North America
BMO Financial Group Reaches Key Milestone in Matching 100 Per Cent of Electricity Usage with Renewables
BMO Financial Group Recognized as One of the World's Most Sustainably Managed Companies in New Wall Street Journal Ranking
BMO Capital Markets to Donate C$1.6 Million Following 16th Annual Equity Through Education Trading Day
Media Advisory - BMO Capital Markets Celebrates 16 Years of the Equity Through Education Trading Day
Forbes ranks BMO Harris Bank as one of America’s Best Employers for Women in 2020
Tracking the Recovery: BMO Economics Introduces Canadian Business Activity Index
BMO Capital Markets to host 2020 Prescriptions for Success Healthcare Virtual Conference
BMO Financial Group to Source 100 Per Cent of Electricity Usage From Renewables
Media Advisory - BMO Expert Podcast on COVID-19 and the Future of the Global Economy
Canada's Six Biggest Banks Take Decisive Action To Help Customers Impacted by COVID-19
Maple Leaf Foods and BMO Capital Markets enter into First Sustainability-Linked Loan in Canada