Bank of Montreal (BMO.TO) reported fiscal third quarter results that CIBC Capital Markets said are "negative" as the Canadian bank reported a 4% miss versus consensus.
Analyst Paul Holden said the miss was driven by credit, as pre-provision operating profit was higher than consensus.
Holden said BMO's adjusted EPS of $2.64 was below consensus of $2.76 and his estimate of $2.70.
"The total provision for credit losses (PCL) ratio of 54 basis points (bps) increased 10bps sequentially and came in higher than consensus at 46bps and our forecast of 47bps," the analyst said in a note to clients.
"Impaired came in at 50bps, up from 41bps last quarter, mostly driven by losses in US commercial and wholesale banking," Holden said.
The analyst maintained a Neutral rating and $120 price target on BMO shares.
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