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With a five-year Total Shareholder Return of 18.7% and a track record for delivering rising earnings through effective strategy execution, BMO Financial Group is moving closer to its goal of becoming a top-performing Canada-U.S. financial services organization.

That's the message that Tony Comper, President and CEO, BMO Financial Group, delivered to a Scotia Financial Summit 2004 audience gathered today at the Hilton Toronto Hotel.

Mr. Comper said BMO Financial Group's seasoned leadership team had identified the right business mix, the right strategy and the right priorities "to stake a legitimate claim as Canada's low-risk, high-return bank."

"While most of the Canadian banks are targeting the U.S. for expansion, our distinct advantages include an already strong franchise in some of the most lucrative markets in the United States, a proven track record as an accomplished acquirer, and both a proven capacity and a strong corporate will to significantly improve productivity," he stated.

"Five years ago, I told this audience that we were undertaking a major transformation of BMO to build stronger relationships with our clients, improve our lagging relative performance and achieve higher, sustainable returns for our shareholders," he said. "Our numbers indicate that we are doing just what we set out to do, which is to maximize returns for our shareholders… as evidenced by our progress in improving return on equity, net income, cash productivity and our five-year total shareholder return."

"As demonstrated by nine consecutive quarters of earnings growth, we are successfully executing a Canada-U.S. growth strategy that is clearly working," said Mr. Comper.

He added that shareholders are beginning to reap the rewards of BMO's disciplined and focused management. BMO has hiked dividends twice this year - a 26% increase from 2003, when the organization also increased dividends a total of 17% in two installments.

"This year's large increase, which marks our 12th consecutive year of dividend increases, reflects BMO's strong capital position and this leadership team's confidence in the quality of our earnings and our ability to meet our performance commitments," said Mr. Comper.

Mr. Comper said that BMO's future operating leverage will come from productivity improvement, organic growth, the organization's credit expertise, strong capital base for future acquisitions, technology investments in BMO's Canadian personal and commercial operations, commercial and mid-market credit utilization in the U.S. and any improvement in the economy.

Mr. Comper outlined specific priorities and financial progress in BMO's three operating groups, Personal and Commercial Client Group, Private Client Group and Investment Banking Group. Excerpts from his address follow below:

Strategic Priorities for F2004

"Improving the productivity and profitability of our U.S. operations is one of our top enterprise priorities for 2004 - as (of course) is productivity improvement overall. While we are making good progress on both, we see lots of opportunity for continued improvement."

Continuing Commitment to Enterprise Growth Strategy

"We are growing profits in our core, established businesses in Canada by focusing on building lasting client relationships and improving productivity. At the same time we are expanding profitably where opportunities exist, notably the U.S. Midwest, the business banking market in Canada, and the wealth management market in both Canada and the U.S."

"These stronger fundamentals result in part from our success in shifting our business mix. As a reminder, we are aiming for an overall business mix that is 70% retail and 30% wholesale, and we anticipate an increasing percentage contribution from our U.S. operations over time."

"The stronger fundamentals also result from disciplined execution of our Canada-U.S. growth strategy. This strategy has already made BMO a leader among our peers in successful U.S. expansion, and we remain committed to growing profits in our broad-based Canadian franchise while improving and selectively expanding our U.S. franchise."

Established Foothold and Expertise for U.S. Expansion

"What sets us apart from our Canadian competitors in terms of U.S. growth potential is the franchise itself, established in one of the highest-growth, highest-potential areas of the U.S. and tied together by the distinguished Harris brand… we have a proven capacity to achieve targeted growth from our existing Harris retail, business banking and wealth platform. We have an established and growing mid-market business in the Midwest. And, of course, we have unparalleled equity research capability. Together, these strengths translate into below-average reinvestment risk in the U.S. market."

"It is hard to overstate the value of our well-established presence in the high-growth Chicago area where, as evidenced by volume growth and market share results, we are competing successfully against large and determined new market entrants. Our entrenched advantages include the Harris brand, a well-located distribution network in prime real estate throughout the Chicago area, and two decades of on-the-ground management experience. A particularly hard-to-replicate competitive advantage in this regard is our integrated Canada-U.S. management philosophy.

"We continue to believe that our franchise is the jewel among U.S. holdings by Canadian banks - and that this management team's insight into how to succeed in the U.S. is unmatched in our peer group."

"As for industry trends, the most important U.S. story remains ever-increasing competition and industry consolidation as the drive for scale and operating efficiencies continues in the aftermath of deregulation. Our U.S. franchise is well positioned to benefit from this trend."

Personal and Commercial Banking: Building Lasting Relationships and Focusing on Productivity

"The goal in our Canadian personal and commercial operations is to become the only financial services provider our customers will ever need. Toward this end, we are enhancing our distribution system to make it easier for our customers to do business with us and to provide them with a consistently positive experience no matter which banking channel they choose.

Mr. Comper noted technology improvements, which provide BMO salespeople with an integrated banking portrait of each customer, have reduced wait times and improved the quality of dialogue with customers and reduced the amount of time spent on paperwork so that colleagues can focus on helping customers and increase sales.

He cited, as an example, the implementation of an electronic service request system that enables BMO to provide a same-day response to customer service requests that used to take more than a week to complete. "The new system is already resulting in happier customers and will free up more than 200,000 hours of branch time annually to respond to other customer needs," he explained.

Private Client Group: Strongest Results in Recent Years

"We have done a pretty solid job of growing revenue and net income by managing our businesses very effectively during the downturn. Since 2002, we have improved cash productivity by 1000 basis points through focused revenue-generating initiatives and disciplined management of our expenses, including reengineering business models, renegotiating external contracts and reducing non-client facing positions. Our realigned business units are now well positioned to ensure solid results in all market conditions, and to reap even better returns with a little help from the markets."

Investment Banking: Strong Financial Performance

"The big story in the Investment Banking Group in recent years has been our major business mix shift to higher-return business, pushing up the group's cash return on equity from single digits to the 19% cash return on equity this group has achieved so far this year."

With respect to the group's distinctive strategies in Canada and the U.S., Mr. Comper stated, "We are building an integrated North American investment and corporate bank - one that will capitalize on industry specialties and distinctive capabilities. Our aim is to provide Canadian large corporate and U.S. mid-market clients with a coordinated approach to raising the capital they need."

Signature Strengths

"Other BMO signature strengths significantly include our ongoing leadership in corporate governance and our prudence and expertise in credit risk management."

"We are proud of the talent and dedication of our people, who are becoming increasingly adept at improving productivity and achieving higher levels of performance."

"We are excited about the opportunities to grow and deepen client relationships in both Canada and the U.S."

"We are delivering on our promises."

Full text of Mr. Comper's remarks are available at www.bmo.com/investorrelations.

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