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BMO Financial Acquires Bank of the West to Expand to US Geographies.

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MANews-(C)2009-2021

Toronto-based BMO Financial Group (TSX: BMO) (NYSE: BMO), and its indirect wholly owned Chicago-based subsidiary, BMO Harris Bank N.A., have agreed to acquire California-based Bank of the West and its subsidiaries from BNP Paribas (XPAR: BNP) to expand to new US geographies, the company said.

Bank of the West had assets as of CDN 135bn (USD 105bn) as of September 30, 2021.

Under the terms of the agreement, BMO will acquire Bank of the West for a cash purchase price of CND 16.3bn (USD 13.4bn). BMO will fund the transaction primarily with excess capital reflecting its strong capital position and anticipated capital generation.

On closing, the acquisition will bring nearly 1.8m customers to BMO and will further extend its banking presence through 514 additional branches and commercial and wealth offices in key US growth markets.

The transaction is expected to be immediately accretive on closing to BMO's adjusted earnings per share and over 10% accretive in 2024, including estimated cost synergies. The estimated internal rate of return is approximately 14%.

The purchase price is estimated at 1.5 times Bank of the West's expected tangible common book value based on the estimated balance sheet at close.

The acquisition adds approximately USD 56bn of loans and USD 89bn of deposits based on Bank of the West's September 30, 2021 balance sheet.

BMO and...

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