BMO to take earnings hit from $320M in charges
Last Updated: Friday, November 16, 2007 | 4:17 PM ET
CBC News
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BMO Financial Group said Friday it will take $320 million in a variety of charges as the bank joined the list of Canadian financial institutions disclosing their costs from the global credit crunch.
BMO said the charges will result in a 50-cents-per-share reduction in its fourth-quarter earnings. The bank will release its Q4 results on Nov. 27.
The myriad pre-tax charges include:
- $170 million for trading and structured credit-related positions and preferred shares.
- $135 million for Canadian asset-backed commercial paper.
- $15 million on capital notes of two structured investment vehicles.
- $185 million to increase the liability for future customer redemptions in its loyalty rewards program.
- $25 million to reduce its commodities portfolio.
The charges will total $210 million after tax.
BMO also said it will record a gain of $110 million from the sale of shares of MasterCard International.
Scotiabank, CIBC and Royal Bank of Canada have already laid out the charges they will take in the current quarter for their exposure to problems in credit markets.
BMO shares slipped 46 cents to end at $56.66 on the TSX.
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