Jake Miller
The Bank of Montreal, commonly abbreviated as BMO, is a Canadian multinational investment bank and financial services company. Founded in 1817, it is the oldest bank in Canada. BMO has over 900 branches in Canada and more than 1000 in the United States, serving over 13 million customers worldwide. In addition to its traditional banking services, BMO has been serving auto dealerships for nearly 40 years, offering floor plan financing, facility upgrades, and deposit and treasury solutions. However, in 2023, BMO announced it would wind down its indirect retail auto finance business, shifting its focus to other areas. This move was likely influenced by increasing bad debt provisions and delinquency rates in consumer vehicle loans.
| Characteristics | Values |
|---|---|
| Date of founding | 1817 |
| Location of founding | Montreal, Quebec, Canada |
| Current headquarters | Montreal, Quebec, Canada |
| Operational headquarters | Toronto, Ontario, Canada |
| Number of branches in Canada | 900+ |
| Number of branches in the United States | 1000+ |
| Number of customers served globally | 13 million+ |
| Services | Retail banking, investment banking, wealth management, private banking, credit cards, loans, insurance |
| Dealer finance services | Floorplan financing, facility upgrades, deposit and treasury solutions, acquisition financing, succession financing, electrification support, carbon footprint reduction support |
| Number of years serving dealerships | Nearly 40 |
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What You'll Learn
BMO's indirect retail auto finance business
The Bank of Montreal (BMO), Canada's oldest bank, was founded in 1817 and is headquartered in Montreal, Quebec. BMO is divided into three "client groups": Personal and Commercial Client Group (retail banking), Investment Banking Group, and Private Client Group (wealth management).
One of BMO's business areas has been its indirect retail auto finance business, where the bank works with car dealerships in Canada and the United States to arrange financing for buyers, who then make monthly payments to the lender.
However, in September 2023, BMO announced it would be winding down this indirect retail auto finance business and shifting its focus to other areas. This decision was made due to a surge in bad debt provisions, with BMO's bad debt provisions for the quarter ended July 31, 2023, tripling to $492 million compared to the previous year. This rise in bad debt is a sign of the growing financial stress faced by consumers due to the rapid increase in borrowing costs and interest rates.
The move to exit the indirect auto financing business is intended to allow BMO to focus its resources on areas where it believes it has stronger competitive positioning and to mitigate risks in a challenging economic environment. While this decision may result in an unspecified number of job losses, the bank has stated that it is working closely with affected employees to provide support.
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BMO's investment and corporate banking division
The Bank of Montreal (BMO), founded in 1817, is a Canadian multinational investment bank and financial services company. BMO's investment and corporate banking division is called BMO Capital Markets. In the United States, BMO operates as BMO Financial Group, with significant operations in Chicago and other areas.
BMO Capital Markets was formed in 2006 when BMO Financial Group's Canadian, U.S., and international wholesale banking capabilities were merged. The BMO brand was added to Nesbitt Burns (formed by the merger of Nesbitt Thomson and Burns Fry in 1994) in 2000 to associate the firm with BMO Financial Group. In 2003, BMO Financial Group acquired Gerard Klauer Mattison (GKM), providing Harris Nesbitt with U.S.-based equity research and institutional sales and trading capabilities.
BMO Nesbitt Burns is the wealth management division of BMO, offering full-service investing in Canada. BMO Nesbitt Burns was formed through the acquisition of Nesbitt Thomson, one of Canada's oldest investment houses, and Burns Fry, a dealer of Canadian equities and debt securities. BMO InvestorLine and BMO Harris Investor Services provide self-service and advisory investing services in Canada and the United States, respectively.
BMO also offers private banking services through BMO Private Banking in both Canada and the United States. This includes affiliates such as Harris myCFO and Cedar Street Advisors. BMO Life is the bank's life insurance division, and mbanx was its former virtual bank division.
BMO has expanded its operations over the years through acquisitions and mergers. In 2006, BMO acquired BCPBank, the Canadian division of Banco Comercial Português. In 2009, BMO purchased AIG's Canadian life insurance business, becoming the second-largest life insurer among Canadian banks. In 2021, BMO announced the acquisition of Bank of the West for US$16.3 billion.
BMO has a presence in both the United States and Canada, with over 900 branches in Canada and more than 1000 branches in the United States, serving over 13 million customers worldwide. BMO's US operations, BMO Bank, are a member of the Federal Reserve System and the Federal Deposit Insurance Corporation.
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BMO's wealth management division
The Bank of Montreal, commonly abbreviated as BMO, is a Canadian multinational investment bank and financial services company. It is the country's oldest bank, founded in Montreal, Quebec, in 1817. BMO is divided into three "client groups": Personal and Commercial Client Group (retail banking), Investment Banking Group, and Private Client Group (wealth management).
BMO Nesbitt Burns is an integrated wealth management provider, serving clients through various subsidiaries and affiliates. These include BMO Private Wealth, led by Chief Market Strategist Carol Schleif, and BMO Investment Services, headed by Wallace, who leads the financial advisor team.
The wealth management group also includes BMO Private Banking, which offers private banking services in Canada and the United States. BMO Harris Investor Services provides advisory services in the United States, while BMO Harris Bank affiliates, Harris myCFO and Cedar Street Advisors, offer specialised financial advice.
In addition to its Canadian operations, BMO's wealth management division extends to the United States, where it operates as BMO Financial Group, with a strong presence in the Chicago area. The division's focus on wealth management is evident through its range of services aimed at protecting and growing clients' wealth, including insurance policies and business succession planning.
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BMO's presence in the US
The Bank of Montreal (BMO) has a long history of operations in the United States, dating back to its early days as a Canadian bank. Within months of its founding in Montreal in 1817, BMO opened an office in New York City, marking its first international presence. This initial expansion set the tone for BMO's continued growth and presence in the US market.
In 1861, BMO established a permanent agency in Chicago at the invitation of local grain merchants, solidifying its presence in the Midwest. The bank's network continued to expand across the US, and by 1864, BMO had a presence in California through the acquisition of the Bank of British North America. This expansion positioned BMO as a significant facilitator of cross-border economic activity between the US and Canada.
Today, BMO has a significant presence in the US with over 1000 branches, serving a diverse range of customers. The bank continues to grow and evolve, adapting to market changes and customer needs. In 2023, BMO completed the acquisition of Bank of the West, adding 1.8 million new customers and further expanding its footprint in the US market. BMO's presence in the US is an integral part of its overall operations, contributing to its position as a top-ten North American bank.
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BMO's history and establishment
BMO Bank, N.A. (colloquially BMO) is a US national bank headquartered in Chicago, Illinois. It is a subsidiary of the Canadian multinational investment bank and financial services company Bank of Montreal, which owns it through the holding company BMO Financial Corporation.
BMO was founded in Chicago in 1882 as N.W. Harris & Co. by Norman Wait Harris. In 1907, the company changed its name to Harris Trust and Savings Bank, and then to Harris Bank in 1972. In 1984, the Bank of Montreal acquired Harris Bank, marking the first acquisition of an American bank by a Canadian financial institution. Following the acquisition, the company began to operate under the name BMO Harris Bank.
Under the ownership of the Bank of Montreal, BMO expanded its presence in the US through a series of acquisitions of other banks. Notable acquisitions include Suburban Bancorp in 1994, Marshall & Ilsley in 2011, and Bank of the West in 2023. In 2011, the company restructured as BMO Bankcorp, and in 2023, it completed the acquisition of Bank of the West, bringing 1.8 million new customers to BMO.
Throughout its history, BMO has placed significant importance on branding and advertising. In 1957, the cartoon character "Hubert the Harris Lion" was created for an advertising campaign, becoming a well-recognized symbol in Chicago banking. The "M-Bar" logo was launched in 1967, and the vibrant blue colour adopted by the bank became known as "First Bank Blue". BMO's use of Bob Dylan's "The Times They Are a-Changin'" in a television campaign caused some controversy, setting the bank apart from its competitors.
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Frequently asked questions
The Bank of Montreal (BMO) is a Canadian multinational investment bank and financial services company. It is the oldest bank in Canada, founded in Montreal, Quebec, in 1817.
Yes, the Bank of Montreal has a dedicated team of bankers serving dealerships. They provide services such as floor plan financing, facility upgrades, and deposit and treasury solutions. BMO has nearly 40 years of experience in the industry.
BMO's investment and corporate banking division is called BMO Capital Markets.
Yes, BMO operates in the United States under the name BMO Financial Group, with a strong presence in the Chicago area and elsewhere in the country.
The Bank of Montreal's swift code is BOFMCAM2.
