BMO to Buy Marshall & Ilsley

The Wall Street Journal, David Reilly, 18 December 2010Bank of Montreal's acquisition of Marshall & Isley may signal the start of a hoped-for wave of regional bank consolidation. But others shouldn't follow its lead when it comes to price.BMO is buying M&I for $4.1 billion, equivalent to a 33% premium over the prior day's close for a bank hit hard by the financial crisis. M&I has yet to pay back

Preview of Banks' Q4 2010 Earnings

Scotia Capital, 17 November 2010Banks Begin Reporting November 30 – Earnings Sluggish• Banks begin reporting fourth quarter earnings with National Bank (NA) on November 30 (after market close), followed by Canadian Imperial Bank of Commerce (CM) and Toronto-Dominion (TD) on December 2, Royal Bank (RY) and Bank of Nova Scotia (BNS) on December 3, Bank of Montreal (BMO) and Canadian Western (CWB)

Review of Banks' Q3 2010 Earnings

Scotia Capital, 13 September 2010Event• Canadian banks' third quarter operating earnings were disappointing, missing earnings estimates, the first quarterly miss of the earnings recovery cycle. ROE: 15.9%, RRWA: 2.06%, Tier 1: 12.8%.Implications• The major collapse in trading revenue from record levels a year earlier cut wholesale earnings in half. Trading revenue as a percentage of total revenue

Canadian Banks Confident Ahead of New Basel Rules

Thomson Reuters, 27 August 2010Canada's banks appear set to handily absorb stiffer global capital and liquidity rules being developed by the Basel banking committee, meaning they could soon begin raising dividends and making acquisitions.While the new regulations won't be released until November, the CEOs of Canada's big six banks have begun speaking more confidently about their ability to adopt

BMO Q3 2010 Earnings

Scotia Capital, 25 August 2010Event• BMO cash operating EPS increased 9% to $1.14, below our estimate of $1.20 and consensus of $1.21. Earnings were lower-than-expected due to extremely weak trading revenue and lower security gains, partially offset by lower than expected LLPs. Operating ROE was 13.9%.Implications• Positives for the quarter were credit and strong operating results in core

Credit Suisse: Revenue Growth to Slow for Banks

Credit Suisse, 19 August 2010As Canadian bank earnings/returns on equity (ROE) benefit from declining credit charges, slowing revenue growth represents a headwind.We forecast provisions for credit losses (PCLs) to decline 35% and 36% in 2010 and 2011, respectively, providing a substantial boost to group profitability. However, as this earnings/ROE driver loses momentum, the onus falls on revenue

Preview of Banks' Q3 2010 Earnings

Scotia Capital, 12 August 2010Banks Begin Reporting Third Quarter Earnings August 24 - Uninspiring• Banks begin reporting third quarter earnings with Bank of Montreal (BMO) on August 24, followed by Canadian Imperial Bank of Commerce (CM) on August 25, Royal Bank (RY) and National Bank (NA) on August 26, Bank of Nova Scotia (BNS) on August 31, Canadian Western (CWB) on September 1 (after market

Basel Tone Improves - Positive for Canadian Banks

Scotia Capital, 28 July 2010• The Basel Committee on Banking Supervision reached broad agreement July 26, 2010 on the overall design of the capital and liquidity reform package including definition of capital, the treatment of counterparty credit risk, the leverage ratio, and the global liquidity standard.• In general, the agreement seems to provide a more balanced and constructive approach to

Review of Banks' Q1 2010 Earnings

Scotia Capital, 19 March 2010Strong Earnings, Ahead of Market Expectations• Canadian banks reported another quarter of strong operating results. Bank earnings again exceeded Street expectations for the fourth straight quarter, thus further confirming that the bottom in operating earnings this cycle was Q2/09, which coincided with what we believe was peak quarterly loan loss provisions. Operating