BMO Reports Strong Profit and Revenue Growth in Q3 2025

BMO (BMO.US) reported adjusted net income of C$2,399 million and adjusted EPS of C$3.23 for Q3 2025. This represents an increase of 21% in adjusted net income and 22% in adjusted EPS compared to the prior year. The adjusted EPS of C$3.23 for Q3 2025 significantly exceeded the analyst estimate of C$2.12.

Total revenue was C$8,988 million, marking a 10% increase from the prior year. This performance was driven by solid revenue growth across all operating segments and in Corporate Services.

Strong Revenue Performance

BMO's revenue surged to C$8,988 million in Q3 2025, an increase of C$796 million or 10% from the prior year. This growth was largely due to an increase in net interest income of C$702 million or 15%, driven by higher net interest margin and balance growth in Canadian P&C and BMO Wealth Management. Non-interest revenue also saw a 3% increase, benefiting from higher underwriting and advisory fees, wealth management fees, and deposit fee revenue.

The bank's overall reported net interest margin improved by 17 basis points to 1.69%. This was primarily attributed to higher deposit and loan margins and increased net interest income in Corporate Services. Adjusted net interest margin, excluding trading-related net interest income and trading and insurance assets, rose by 16 basis points to 1.99%.

Improved Credit Performance

Total provision for credit losses (PCL) decreased to C$797 million in Q3 2025, down from C$906 million in the prior year. This reduction indicates an improvement in the bank's credit risk profile. The PCL on impaired loans was C$773 million, a decrease of C$55 million, primarily due to lower provisions in U.S. Commercial Banking and BMO Capital Markets.

The provision for credit losses on performing loans also saw a substantial reduction, from C$78 million in the prior year to C$24 million in the current quarter. This was largely influenced by an improvement in macro-economic scenarios. The total PCL as a percentage of average net loans and acceptances stood at 0.47%, down from 0.54% in the prior year.

Strategic Growth and Operational Efficiency

BMO's adjusted non-interest expense increased by 7% to C$5,012 million, primarily due to higher employee-related expenses and increased computer and equipment costs. Despite this, the adjusted efficiency ratio improved to 55.8% from 57.3% in the prior year, indicating better cost management relative to revenue growth. The bank achieved positive adjusted operating leverage of 2.9%, demonstrating its ability to grow revenue faster than expenses.

Management highlighted ongoing investments in digital and AI capabilities to enhance client experience and support sustainable growth across its businesses. The recently announced acquisition of Burgundy Asset Management Ltd. is set to expand BMO's wealth management and financial planning capabilities, particularly for high-net-worth individuals and institutions.