Bank of Montreal posted a drop in fiscal second-quarter profit as it set aside a large provision for loan losses and trading revenue fell.
The bank’s provision for credit losses of C$1.02 billion (about $755 million) included an initial C$517 million (approximately $380.6 million) on the performing loan portfolio of Bank of the West, according to Bloomberg News. It’s the first time Bank of Montreal has reported results that include the Bank of the West, which it bought from BNP Paribas SA for $16.3 billion. The Bank of the West deal expanded the bank’s U.S. footprint to 32 states and makes its U.S. personal and commercial banking division, with C$2.6 billion (about $1.9 billion) in revenue during the quarter, slightly larger than its Canadian one.
Excluding some items, profit was C$2.93 (approximately $2.16) a share, missing the C$3.21 (approximately $2.36) average estimate of analysts in a Bloomberg survey.