BMO, the Canadian lender, raised its quarterly dividend after reporting higher earnings and higher returns on equity, but also a decline in revenue for the first quarter of its 2018 fiscal year.
The bank reported a profit of $1.97 billion, or $1.96 per share, a rise of 6.3% from the first quarter of 2017.
A year ago, BMO reported a profit of $1.85 billion, or $1.85 per share. Earnings grew 3.6% excluding one-time items, according to Bloomberg.
Revenue dropped to $4.2 billion, from $4.7 billion a year ago. This was on the back of the narrowing spread between the bank’s loans and deposits, which BMO blamed on higher funding costs.
BMO said its efficiency ratio, a measure of the expense ratio as a percentage of revenue, fell to 59.9% from 62.9% a year ago.
BMO raised its quarterly dividend by 25% to 74 cents per share.
The results come a week after rival Royal Bank of Canada released a better-than-expected first quarter report. This was the second report out of the big Canadian banks, which have led the charge on strong corporate earnings growth in the country.
A number of asset managers in Canada are reporting stronger flows into funds this year, amid increasing optimism over a slowing Canadian economy. The country’s economy slowed a bit in the first quarter, though, dampening some of that optimism.
RBC recently announced plans to invest $300 million in its RBC Global Asset Management group, the bank’s asset management arm.
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