Bank of Montreal at Scotiabank Financials Summit Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : Very good. Thanks for joining us, Darryl. Maybe just to start with -- just your high-level outlook on some of the macroeconomic headwinds. And it seems that it's been a very volatile period for all the banks. And how are you feeling right now in terms of your outlook?

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : Okay, thank you for that. So it dovetails into the ROE question, obviously. The PCL environment was challenging for BMO and the industry more broadly. It tends to be volatile from quarter to quarter. Things have gotten a lot better there. Your outlook doesn't seem to be -- it seems to be better than it was a quarter ago, which I'm guessing gives you more confidence in your ROE trajectory at the all-bank level. Maybe just remind investors the pathway of getting to that 15% level. And obviously, there's still more room to go, but you've made some strides --

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : Got it. Maybe on the credit. You might hate this question. I know sometimes you've gotten this question before on the calls. Given the headwinds that you saw on the credit side, did it change how you saw it operate -- ?

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : You don't hate this? Okay, perfect.

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : Maybe it's an opportunity to sort of remind investors why nothing changes, that it was in fact a blip. It's in the past, and it doesn't really impact your -- either your ability to grow the commercial loan book, particularly the US, that's where the question usually emanates from. And why you're still excited about your --

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : Okay, thanks for that. Maybe moving on to some of the business lines, starting with the US. Just with the new leadership. So Aron Levine coming in and running the business. Is there -- are there any changes that investors should expect to see or?

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : Okay. Also you sort of touched on my next question, which was around the connectivity, US P&C, wealth, capital markets. How does that sort of all tie in from your perspective? And where do you see opportunities on that client outreach and deeper relationships and doing more for the same? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 03, 2025 / 2:40PM, BMO.TO - Bank of Montreal at Scotiabank Financials Summit

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : Okay. One more follow up on the US. Just want to talk a little bit about Bank of the West, that deal, obviously very big transformational deal for BMO. Now that you look at the US market, has anything changed versus when you purchase Bank of the West from a competitive perspective? Has it become more competitive less? I know you were excited about -- probably still are excited about the California market, which has a GDP bigger than Canada's. A lot of opportunity there. Maybe talk about the dynamics of the competitive environment if anything has in fact changed post-COVID and pre-COVID?

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : Okay, and then maybe switching over to Canada and staying on that theme of the landscape -- the competitive landscape. How do you see Canada evolving going forward? It's fair to say it's less competitive than the US --

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : You mentioned the lag with the US, so you would expect candidates to sort of catch up with something?

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : What about the cost side in Canada? We hear banks talk a lot about optimization of the branch network. I'm guessing that you're also actively doing that. You mentioned that you've talked about that in the past as well. Maybe just remind investors where your priorities are on whether it's branch count or not necessarily the number of branches, but how you're looking to cut costs within your physical infrastructure?

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : In retail banking.

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : Okay. Awesome. Any comments on the mortgage business? I know that's always topical for investors, not from a direct loss perspective. I think, people are comfortable with the risk side, but what about on the growth side? We've seen sales volumes come in relatively weak this entire spring, summer lending season. It hasn't really been the rebound that many were expecting.

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : Okay. Maybe switching over to cap markets. Your pre-tax, pre-provision guidance of $625 million, you sort of crushed that number the last three quarters. I think, there is obviously an expectation that trading, which has been a big part of that.

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : Well, it's certainly been a very, very good setup for BMO as well as your peers. Just wondering as that maybe moderates, perhaps volatility comes down the market, we get a bit less client activity. How do you look at that $625 million?

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : How about on the advisory side in the US? I think, it's clear that BMO has been very focused on how it's invested in cap markets in the US, very, very structured, not looking to be all things to everyone. If we do get an M&A rebound in the US, how are you positioned for that or are you looking to deploy more? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 03, 2025 / 2:40PM, BMO.TO - Bank of Montreal at Scotiabank Financials Summit

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : What about the cross-border dynamic in terms of transactions? Has that been still being impacted by the geopolitical uncertainty?

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : Okay. Thanks for that. Maybe switching over to capital, obviously BMO has been a very acquisitive bank over time, some sizable transactions in the past. And you've got a pretty good track record of making them work over time. Just given that we're now well past the closing of Bank of the West, are you starting to think about that now that your capital level is so strong and you're accreting capital quarter over quarter?

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : How do you sort of think about M&A from the perspective of whether it's size, business line, or geography? Any thoughts?

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : Okay. And then on buybacks, obviously the NCIB, I think it's about 4% now, gives you a lot of optionality. And maybe in the context of getting to that ultimate destination CET1, I'm not going to ask you for a timeline, but I know you've been very vocal about -- 12.5% is a really solid number where BMO could operate at very comfortably. You'd be good with 12.5%. You're about 100 basis points above that right now so --

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : Okay. As we get to the end here, any key messages you want to convey to investors in the room today --?

Question: Mike Rizvanovic - Scotiabank GBM - Analyst : Okay. With that, we'll end the conversation. Thank you very much, Darryl, for your insights. Thanks for joining us today. Very, very happy to have you join us and --