BMO Financial Group Reports Fourth Quarter and Fiscal 2018 Results (10)

(Canadian $ in millions, except as noted) Q4-2018 Q3-2018 Q4-2017 Fiscal 2018 Fiscal 2017 --- Net interest income (teb) 2,431 2,396 2,263 9,384 8,812 Non-interest revenue 835 841 787 3,311 3,248 --- Total revenue (teb) 3,266 3,237 3,050 12,695 12,060 Provision for credit losses on impaired loans (1) 179 174 na 724 na Provision for (recovery of) credit losses on performing loans (1) 3 3 na (35) na --- Total provision for credit losses (1) 182 177 194 689 772 Non-interest expense 1,740 1,732 1,642 6,817 6,566 --- Income before income taxes 1,344 1,328 1,214 5,189 4,722 Provision for income taxes (teb) 297 322 320 1,241 1,184 --- Reported net income 1,047 1,006 894 3,948 3,538 --- Amortization of acquisition-related intangible assets (2) 12 12 12 47 49 --- Adjusted net income 1,059 1,018 906 3,995 3,587 === Net income growth (%) 17.1 14.1 2.8 11.6 8.3 Adjusted net income growth (%) 16.9 13.9 2.6 11.4 8.0 Revenue growth (%) 7.1 6.7 1.9 5.3 4.0 Non-interest expense growth (%) 5.9 4.4 0.7 3.8 2.4 Adjusted non-interest expense growth (%) 6.0 4.5 0.8 3.9 2.5 Return on equity (%) 19.0 18.5 17.1 18.6 16.7 Adjusted return on equity (%) 19.3 18.8 17.3 18.8 16.9 Operating leverage (teb) (%) 1.2 2.3 1.2 1.5 1.6 Adjusted operating leverage (teb) (%) 1.1 2.2 1.1 1.4 1.5 Efficiency ratio (teb) (%) 53.3 53.5 53.9 53.7 54.4 Adjusted efficiency ratio (teb) (%) 52.8 53.1 53.3 53.2 53.9 Net interest margin on average earning assets (teb) (%) 2.98 2.97 2.94 2.97 2.90 Average earning assets 324,014 319,954 305,841 316,359 304,178 Average gross loans and acceptances 330,502 325,545 309,413 321,537 306,381 Average net loans and acceptances 328,923 323,984 309,280 320,019 306,239 Average deposits 258,602 251,671 236,309 250,221 238,419 ===

(1) Effective the first quarter of 2018, the bank prospectively adopted IFRS 9, Financial Instruments (IFRS 9). Under IFRS 9, we refer to the provision for credit losses on impaired loans and the provision for credit losses on performing loans. Prior periods have not been restated. The provision for credit losses in periods prior to the first quarter of 2018 is comprised of specific provisions. Refer to the Changes in Accounting Policies section on page 121 of BMO's Annual MD&A for further details. (2) Before tax amounts of $16 million in Q4-2018, $15 million in Q3- 2018, $16 million in Q4-2017, $61 million for fiscal 2018 and $66 million for fiscal 2017 are included in non-interest expense. Adjusted results in this table are non-GAAP amounts or non-GAAP measures. Please see the Non-GAAP Measures section. na - not applicable

The Personal and Commercial Banking (P&C) operating group represents the sum of our two retail and commercial operating segments, Canadian Personal and Commercial Banking (Canadian P&C) and U.S. Personal and Commercial Banking (U.S. P&C). The P&C banking business net income of $1,047 million and adjusted net income of $1,059 million were both up 17% from the prior year. Adjusted net income excludes the amortization of acquisition-related intangible assets. These operating segments are reviewed separately in the sections that follow.

Adjusted results in this P&C section are non-GAAP amounts or non-GAAP measures. Please see the non-GAAP Measures section.

Canadian Personal and Commercial Banking (Canadian P&C)

(Canadian $ in millions, except as noted) Q4-2018 Q3-2018 Q4-2017 Fiscal 2018 Fiscal 2017 --- Net interest income 1,421 1,402 1,369 5,541 5,261 Non-interest revenue 547 550 515 2,171 2,182 --- Total revenue 1,968 1,952 1,884 7,712 7,443 Provision for credit losses on impaired loans (1) 118 120 na 466 na Provision for (recovery of) credit losses on performing loans (1) (15) 17 na 3 na --- Total provision for credit losses (1) 103 137 130 469 483 Non-interest expense 954 949 917 3,805 3,622 --- Income before income taxes 911 866 837 3,438 3,338 Provision for income taxes 236 224 213 884 827 --- Reported net income 675 642 624 2,554 2,511 --- Amortization of acquisition-related intangible assets (2) 1 1 2 3 --- Adjusted net income 676 642 625 2,556 2,514 === Personal revenue 1,266 1,257 1,227 5,013 4,718 Commercial revenue 702 695 657 2,699 2,725 Net income growth (%) 8.3 4.6 5.3 1.7 13.2 Revenue growth (%) 4.4 5.2 4.3 3.6 6.5 Non-interest expense growth (%) 3.9 4.1 2.9 5.0 3.5 Adjusted non-interest expense growth (%) 3.9 4.1 2.9 5.0 3.5 Operating leverage (%) 0.5 1.1 1.4 (1.4) 3.0 Adjusted operating leverage (%) 0.5 1.1 1.4 (1.4) 3.0 Efficiency ratio (%) 48.5 48.6 48.7 49.3 48.7 Net interest margin on average earning assets (%) 2.62 2.60 2.59 2.60 2.53 Average earning assets 215,290 213,829 210,110 212,965 207,815 Average gross loans and acceptances 226,953 224,799 219,114 223,536 215,848 Average net loans and acceptances 226,070 223,936 218,909 222,673 215,667 Average deposits 162,480 159,818 154,335 159,483 152,492 ===

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