Bank of Montreal (BMO) reported first‑quarter 2026 results that surpassed analyst expectations, with net income of $2,489 million and earnings per share of $3.39. Adjusted net income rose to $2,551 million and adjusted EPS to $3.48, while return on equity climbed to 12.1% from 10.6% in the same quarter a year earlier. The bank recorded record revenue of $9.824 billion, driven by strong fee growth across its U.S. banking, wealth‑management, and capital‑markets segments, and incurred a $147 million severance charge related to operational efficiencies. A common‑equity‑tier 1 ratio of 13.1% as of January 31, 2026, underscored the bank’s solid capital position.
The revenue beat was driven by a $0.39 billion lift over the consensus estimate of $9.43 billion. Record revenue was supported by robust fee income in the U.S. banking unit, which benefited from a growing customer base and higher interest‑rate margins, and by wealth‑management and capital‑markets segments that saw increased fee‑generating activity amid a favorable market environment. These segment gains offset modest headwinds in legacy Canadian retail banking, allowing the bank to achieve its highest revenue to date.
BMO’s adjusted EPS of $3.48 exceeded the consensus estimate of $3.20–$3.23, a beat of $0.28 or roughly 8.8%. The earnings outperformance was largely a result of disciplined cost management, which helped preserve margins despite the $147 million severance expense, and the strong fee growth that expanded the bank’s revenue base. The combination of higher fee income and controlled operating costs enabled the bank to deliver double‑digit earnings growth and a higher return on equity.
Looking ahead, BMO guided for earnings per share in the range of $2.40 to $2.72 for the next quarter and projected full‑year fiscal 2026 revenue of $27.88 billion, with a 2027 outlook of $28.93 billion. The guidance reflects confidence in continued fee momentum and a stable macro environment, while the unchanged quarterly dividend of $1.67 per share signals the bank’s commitment to returning capital to shareholders. The strong capital position, with a CET1 ratio well above regulatory minimums, provides a buffer for future growth initiatives.
CEO Darryl White highlighted the bank’s strong start to the year, noting that BMO is building on last year’s momentum to deliver higher return on equity and double‑digit earnings growth. He emphasized that the focus on operational efficiency and disciplined expense management is creating capacity for strategic investments in technology and talent, while maintaining credit quality in line with expectations. The dividend policy and share‑buyback activity further demonstrate the bank’s confidence in its long‑term value creation strategy.
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