TLDR
- BMO stock traded at $118.21, up 3.90%, after reporting stronger-than-expected Q3 earnings.
- Adjusted EPS came in at C$3.23 versus analyst estimates of C$2.96.
- U.S. personal and commercial banking income rose 51% year over year to C$709 million.
- Provisions for credit losses totaled C$797 million, below forecasts of C$931 million.
- BMO announced a new share buyback plan for up to 30 million shares.
On August 27, 2025, Bank of Montreal (NYSE: BMO) shares traded at $118.21, up 3.90%, after the Canadian bank delivered fiscal third-quarter results that topped analyst expectations.
Adjusted earnings reached C$3.23 per share, beating the consensus estimate of C$2.96. Net income rose to C$2.33 billion from C$1.87 billion a year earlier, reflecting a 21% profit increase. Reported revenue advanced 9.7% year over year to C$8.99 billion.
U.S. Operations Drive Growth
A major highlight of the quarter was the performance of BMO’s U.S. division, which has been a focus since the 2023 acquisition of Bank of the West. The U.S. personal and commercial banking unit earned C$709 million, up 51% from C$470 million last year and ahead of analyst forecasts. CEO Darryl White credited disciplined execution of return-on-equity strategies and emphasized that the U.S. operations were key to strengthening overall profitability.
Loan-Loss Provisions and Credit Trends
Provisions for credit losses came in at C$797 million, lower than both the prior year’s C$906 million and the C$931 million forecast by analysts. This helped boost quarterly performance, though analysts noted that much of the earnings beat was due to lighter-than-expected provisioning. Credit conditions, which had deteriorated through 2024, have begun to stabilize, easing some concerns about exposure to commercial lending.
Segment Performance Overview
While U.S. operations provided the biggest lift, other business segments also showed improvement. Canadian personal and commercial banking earned C$867 million, down from C$914 million last year, as higher expenses weighed on results. Wealth management delivered C$436 million compared to C$362 million a year earlier, while capital markets earned C$438 million, up from C$389 million. The corporate services division reported a narrower loss of C$120 million versus C$270 million in the prior year.
Strategic Moves and Share Buyback
BMO continues to optimize its balance sheet by selling non-core, lower-return loan portfolios. In the second quarter, it sold a U.S. credit card portfolio, and reports suggest the bank may also divest its transportation finance unit for about $1 billion. The bank announced a new share repurchase program of up to 30 million shares, replacing the prior 20 million authorization under which 15.7 million shares were already bought back. BMO also highlighted its acquisition of Burgundy Asset Management, which will add investment talent and expand digital and AI-driven capabilities.
Outlook
As the first of Canada’s major banks to report quarterly earnings, BMO set a positive tone with results that exceeded expectations. While investors welcomed the strong U.S. momentum and lower provisions, analysts cautioned that sustaining earnings growth will depend on credit quality trends and continued execution in the U.S. division. For now, with shares rallying on the day, BMO’s progress toward improving return on equity is drawing investor approval.
