Good news for Midwest corporate bankers: Bank of Montreal is bulking up its U.S. commercial lending operation and is transferrring an unspecified number of corporate clients from its capital markets division to the commercial bank.
The move, disclosed Tuesday in BMO's earnings release for its first quarter ended Jan. 31, reflects a factory rebound in the region. It more than doubles the commercial bank's portfolio of U.S. commercial loans.
Says Bill Downe, president and chief executive of Toronto-based BMO Financial Group:
In the United States, we are seeing the beginning of a recovery in the Midwest market and expect that companies will be rebuilding their capital and inventories... We have undertaken an analysis of the needs of our BMO Capital Markets borrowing clients to identify those that can be better served under a commercial banking model. We will be shifting those accounts from BMO Capital Markets to our P&C (Personal and Commercial) U.S. business to better align our people and capital with client needs. This will allow us to serve a much larger client base, at lower cost and more efficiently, while increasing our size and momentum in commercial banking in the United States.
The shift frees BMO Capital Markets staff to focus on pursuing investment banking business, Downe adds.