147-year-old US arm Bank of the West. However, at the time, the Canadian bank was competing with other potential suitors, including Toronto-Dominion Bank and Ohio-based KeyCorp, who were also looking to secure a deal over Bank of the West, which had a book value of about US$13.7 billion as of 30 September.
According to the Wall Street Journal, sources had revealed that deliberations between BMO and BNP were ongoing and there was no certainty that an agreement will be reached between the parties at the time.
This week, announcing one of the biggest deals in Canadian banking history, Bank of Montreal revealed that it will be buying the French banking group’s US operation for US$16.3 billion. Sharing details of the transaction on a Monday investor call, White said the deal, which is expected to bring 1.8 million new customers to BMO by the end of next year, will be funded by cash and excess capital. He added that the move would meaningfully expand the bank’s already robust growth south of the border.
“Importantly, it is an optimal use of capital that fuels accelerated growth in a market where we’ve (built) a strong foundation and we have a proven track record,” the BMO chief executive said. “The US contribution to the bank’s earnings has grown from 15 per cent to 36 per cent over the last 10 years, and is expected to increase to 44 per cent on a pro forma basis.”
He further noted that Bank of the West will play a significant role in enabling the Canadian investment banking company to double its branch footprint in neighbouring United States and give BMO a significant foothold in California, where it does most of its business.
