Shareholder letter
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BMO Financial Group Reports Third Quarter 2026 Results REPORT TO SHAREHOLDERS BMO’s Third Quarter 2026 Report to Shareholders, including the unaudited interim consolidated financial statements for the period ended July 31, 2026, are available online at www.bmo.com/investorrelations, on the Canadian Securities Administrators’ website at www.sedarplus.ca, and on the EDGAR section of the U.S. Securities and Exchange Commission’s website at www.sec.gov. Financial Results Highlights Third Quarter 2026 compared with Third Quarter 2025: • Reported net income1 of $1,750 million, a decrease of 25% from $2,330 million; adjusted net income1 of $2,859 million, an increase of 19% from $2,399 million • Reported earnings per share (EPS)2 of $2.38, a decrease of 24% from $3.14; adjusted EPS1, 2 of $3.96, an increase of 22% from $3.23 • Provision for credit losses (PCL) of $722 million, a decrease from $797 million • Reported return on equity (ROE) of 8.4%, compared with 11.6%; adjusted ROE1 of 14.0%, compared with 12.0% • Common Equity Tier 1 (CET1) Ratio3 of 13.0%, compared with 13.5% Year-to-Date 2026 compared with Year-to-Date 2025: • Reported net income1 of $6,869 million, an increase of 7% from $6,430 million; adjusted net income1 of $8,143 million, an increase of 21% from $6,734 million • Reported EPS2 of $9.30, an increase of 10% from $8.47; adjusted EPS1, 2 of $11.11, an increase of 25% from $8.89 • PCL of $2,207 million, a decrease from $2,862 million • Reported ROE of 11.1%, compared with 10.5%; adjusted ROE1 of 13.3%, compared with 11.1% Toronto, August 25, 2026 – BMO Financial Group (TSX:BMO) (NYSE:BMO) reported net income for the third quarter ended July 31, 2026 was $1,750 million, compared with $2,330 million in the prior year, and EPS of $2.38, compared with $3.14. Reported ROE was 8.4%, compared with 11.6% in the prior year. The decrease in reported results was driven by a charge related to the reduction in goodwill associated with the announced sale of BMO’s Transportation and Vendor Finance businesses. Adjusted net income of $2,859 million increased 19% from $2,399 million in the prior year, and adjusted EPS of $3.96 increased 22% from $3.23. Adjusted ROE was 14.0%, compared with 12.0% in the prior year. “BMO delivered another strong quarter, driven by disciplined execution against the commitments we made at our March Investor Day to elevate ROE and accelerate growth. Every business segment delivered record pre-provision pre-tax earnings, with sustained momentum in Capital Markets and Wealth Management, and continued commercial loan growth in both Canada and the U.S. as we deepen client relationships across our franchise. Credit performance improved, reflecting our proactive risk management and well-diversified portfolio,” said Darryl White, CEO of BMO Financial Group. “We continue to reallocate and deploy capital to areas positioned to deliver sustainable and long-term value for our shareholders. This includes profitable loan growth to help support economic expansion, investing in talent, technology and AI-powered capabilities, and returning capital through dividends and share repurchases, while maintaining a robust CET1 ratio,” concluded Mr. White. Concurrent with the release of results, BMO announced a fourth quarter 2026 dividend of $1.71 per common share, unchanged from the prior quarter and an increase of $0.08 or 5% from the prior year. The quarterly dividend of $1.71 is equivalent to an annual dividend of $6.84 per common share. During the quarter, we purchased for cancellation 3.8 million common shares under the normal course issuer bid (NCIB), at an average price of $239.37 per share. On August 25, 2026, we announced our intention to establish a new NCIB for up to 25 million common shares, subject to the approval of the Office of the Superintendent of Financial Institutions (OSFI) and the Toronto Stock Exchange. Once approvals are obtained, the timing and amount of purchases under the new NCIB will be at management’s discretion, based on factors such as market conditions and capital levels. Caution The foregoing section contains forward-looking statements. Please refer to the Caution Regarding Forward-Looking Statements section. (1) Results and measures in this document are presented on a generally accepted accounting principles (GAAP) basis. They are also presented on an adjusted basis that excludes the impact of certain specified items from reported results. Adjusted results and ratios are non-GAAP and are detailed in the Non-GAAP and Other Financial Measures section. Unless otherwise indicated, all amounts are in Canadian dollars. All ratios and percentage changes in this document are based on unrounded numbers. (2) All EPS measures in this document refer to diluted EPS, unless specified otherwise. (3) The CET1 Ratio is disclosed in accordance with the Capital Adequacy Requirements (CAR) Guideline, as set out by the Office of the Superintendent of Financial Institutions (OSFI), as applicable. BMO Financial Group Third Quarter Report 2026 1
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Corporate Events Divestitures On October 16, 2025, we announced the sale of 138 BMO branches in select markets to First-Citizens Bank & Trust Company (First Citizens Bank) to support the optimization of our U.S. branch network and the redeployment of capital and resources. Under the terms of this agreement, First Citizens Bank will assume approximately US$5.3 billion (CAD$7.4 billion) in deposits and purchase approximately US$0.7 billion (CAD$1.0 billion) in loans as at July 31, 2026, for a net deposit premium of approximately 5% paid on closing. This transaction is expected to close in the fourth quarter of fiscal 2026, subject to regulatory approvals and customary closing conditions. On May 11, 2026, we announced the sale of BMO’s Transportation Finance and Vendor Finance businesses to Stonepeak, including related loan portfolios which are part of our U.S. Banking and Canadian P&C operating segments, representing approximately US$9.2 billion (CAD$12.9 billion) and CAD$1.7 billion respectively, as at July 31, 2026. Stonepeak will acquire the assets of these businesses for cash consideration and an earn-out contingent upon the business achieving specified future performance targets. BMO will use a portion of the consideration to invest an approximate 19.9% equity interest in the new entity. As the transaction met the accounting requirements for assets held for sale, we recognized a charge of $1.1 billion pre-tax ($1.0 billion after-tax), primarily related to goodwill in the current quarter. The charge was recorded in non-interest expense in Corporate Services and treated as an adjusting item. The final amount is subject to closing adjustments and foreign exchange rates prevailing at the date of closing. This transaction is expected to close in the fourth quarter of fiscal 2026, subject to regulatory approvals and customary closing conditions. Subsequent to the end of the quarter, on August 10, 2026, we, together with Royal Bank of Canada, entered into a definitive agreement with Francisco Partners for the sale of jointly-owned Moneris Solutions Corporation for cash consideration of approximately $2.0 billion, of which BMO’s share is 50%. We expect to record a gain on closing of approximately $620 million pre-tax ($600 million after-tax), which will be recorded in non-interest revenue in Corporate Services as an adjusting item. The transaction is expected to close by the end of the first quarter of fiscal year 2027, subject to regulatory approvals and customary closing conditions. On closing, the divestitures noted above are expected to add approximately 50 basis points to the bank’s CET1 ratio. On a combined basis, these businesses contributed approximately 2% and 1% to the bank’s reported and adjusted revenue and expenses, respectively, and 5% to the bank’s net income on a reported basis and 3% on an adjusted basis in the current quarter. These divestitures advance BMO's strategic priorities by improving capital efficiency and supporting the allocation of resources to core markets where the bank has attractive long-term growth opportunities. Acquisitions On June 29, 2026, we entered into a definitive agreement to acquire the Australia-based metals and mining focused capital markets business of Euroz Hartleys Group Limited (Euroz Hartleys). This acquisition is expected to close in the fourth quarter of calendar 2026, subject to Euroz Hartleys shareholder approval, regulatory approvals and satisfaction of other customary closing conditions. Following closing, the acquired business will form part of the Capital Markets operating segment. For further information on the above divestitures and acquisition, refer to Note 13 of the unaudited interim consolidated financial statements. Caution This Corporate Events section contains forward-looking statements. Please refer to the Caution Regarding Forward-Looking Statements. 2 BMO Financial Group Third Quarter Report 2026
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Enhanced Disclosure Task Force Disclosures related to recommendations from the Financial Stability Board’s Enhanced Disclosure Task Force (EDTF) to provide high-quality, transparent risk disclosures are detailed in the index below, as presented in BMO’s 2025 Annual Report, the Third Quarter 2026 Report to Shareholders (RTS), Supplemental Financial Information (SFI) or Supplemental Regulatory Capital Information (SRCI). Information on BMO’s website, including information within the SFI or SRCI, is not and should not be considered incorporated by reference into our Third Quarter 2026 Report to Shareholders. Topic EDTF Disclosure Page Number 2025 Annual Report Q3 2026 RTS SFI SRCI General 1. Risk-related information in each report, including an index for easy navigation 67-107 4 Index Index 2. Risk terminology, measures and key parameters 70-107, 122-124 31 – – 3. Top and emerging risks 67-69 6,31 – – 4. Plans to meet new key regulatory ratios once applicable rules are finalized 61 18 – – Risk Governance, Risk Management and Business Model 5. Risk management and governance framework, processes and key functions 70-74 – – – 6. Risk culture, risk appetite and procedures to support the culture 72-75 – – – 7. Risks that arise from business models and activities 63,72-74 – – – 8. Stress testing within the risk governance and capital frameworks 75 – – – Capital Adequacy and Risk-Weighted Assets (RWA) 9. Pillar 1 capital requirements 59-61,185 – – 5-6,15 10. Composition of capital components and reconciliation of the accounting balance sheet to the regulatory balance sheet. A main features template can be found at https://www.bmo.com/main/about-bmo/investor-relations/regulatory-disclosure 62 19 – 5-7,17-18 11. Flow statement of movements in regulatory capital, including changes in Common Equity Tier 1 Capital, Additional Tier 1 Capital and Tier 2 Capital – – – 8 12. Capital management and strategic planning 58-63 – – – 13. Risk-weighted assets (RWA) by operating segment 63 – – 16 14. Analysis of capital requirements for each method used in calculating RWA 59-63, 76-80 – – 16,22-49, 55-67, 70-71,78-81, 84-85, 88-93 15. Tabulate credit risk in the banking book for Basel asset classes and major portfolios – – – 22-49, 51-67,91-93 16. Flow statement that reconciles movements in RWA by risk type – – – 50,71,83 17. Basel validation and back-testing process, including estimated and actual loss parameter information 101-102 – – 94 Liquidity 18. Management of liquidity needs, and liquidity reserve held to meet those needs 89-95 34-35,38 – – Funding 19. Encumbered and unencumbered assets disclosed by balance sheet category 91 35-36 48 – 20. Consolidated total assets, liabilities and off-balance sheet commitments by remaining contractual maturity 96-97 – – – 21. Analysis of funding sources and funding strategy 92-93 35-36 – – Market Risk 22. Linkage of trading and non-trading market risk to the Consolidated Balance Sheet 88 33 – – 23. Significant trading and non-trading market risk factors 84-88 34 – – 24. Market risk model assumptions, validation procedures and back-testing 84-88, 101-102 – – – 25. Primary techniques for risk measurement and risk assessment, including risk of loss 84-88 33-34 – – Credit Risk 26. Analysis of credit risk profile, exposure and concentration 62-63,76-83, 145-152, 163-164 15-16,50-55 24-45 16-81 27. Policies to identify impaired loans and renegotiated loans 146,151 – – – 28. Reconciliation of opening and closing balances of impaired loans and allowance for credit losses 82,148 16,50-52 – – 29. Counterparty credit risk arising from derivative transactions 76-78,83, 163-164 – – 55-73 30. Credit risk mitigation 76-78,147, 154,196-197 – – 21,51-52,68 Other Risks 31. Discussion of other risks 70-73, 98-107 – – – 32. Publicly known risk events involving material or potentially material loss events 98-107, 197-198 – – – BMO Financial Group Third Quarter Report 2026 3
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Management’s Discussion and Analysis Management’s Discussion and Analysis (MD&A) commentary is as at August 25, 2026 for the period ended July 31, 2026. The material that precedes this section comprises part of this MD&A. The MD&A should be read in conjunction with the unaudited interim consolidated financial statements for the period ended July 31, 2026, included in this document, as well as the audited annual consolidated financial statements for the year ended October 31, 2025, and the 2025 annual MD&A, contained in Bank of Montreal’s 2025 Annual Report. The 2025 annual MD&A includes a comprehensive discussion of our businesses, strategies and objectives, and can be accessed on our website, together with other disclosure materials, including interim filings, and our most recent Annual Information Form, Notice of Annual Meeting of Shareholders and Proxy Circular at www.bmo.com/investorrelations. Readers are also encouraged to visit the site to view other quarterly financial information. Bank of Montreal uses a unified branding approach that links all of the organization’s member companies. Bank of Montreal, together with its subsidiaries, is known as BMO Financial Group. In this document, the names BMO and BMO Financial Group, as well as the words “bank”, “we” and “our”, mean Bank of Montreal, together with its subsidiaries. Table of Contents 5 Caution Regarding Forward-Looking Statements 30 Off-Balance Sheet Arrangements 6 Economic Developments and Outlook 30 Accounting Policies and Critical Accounting Estimates and Judgments 7 Financial Highlights 30 Allowance for Credit Losses 8 Non-GAAP and Other Financial Measures 31 Future Changes in Accounting Policies 13 Impact of Foreign Exchange 31 Other Regulatory Developments 13 Net Income 31 Risk Management 14 Revenue 31 Top and Emerging Risks That May Affect Future Results 15 Total Provision for Credit Losses 32 Real Estate Secured Lending 16 Impaired Loans 33 International Exposures 16 Non-Interest Expense 33 Market Risk 17 Provision for Income Taxes 34 Liquidity and Funding Risk 17 Balance Sheet 37 Credit Ratings 18 Capital Management 40 Glossary of Financial Terms 21 Operating Segments Performance Review 43 Interim Consolidated Financial Statements 21 Canadian Personal and Commercial Banking (Canadian P&C) 43 Consolidated Statement of Income 23 U.S. Banking 44 Consolidated Statement of Comprehensive Income 25 Wealth Management 45 Consolidated Balance Sheet 26 Capital Markets 46 Consolidated Statement of Changes in Equity 28 Corporate Services 47 Consolidated Statement of Cash Flows 29 Summary Quarterly Earnings Trends 48 Notes to Interim Consolidated Financial Statements 30 Transactions with Related Parties 69 Investor and Media Information Bank of Montreal's management, under the supervision of the Chief Executive Officer and the Chief Financial Officer, has evaluated the effectiveness, as at July 31, 2026, of Bank of Montreal's disclosure controls and procedures (as defined in the rules of the U.S. Securities and Exchange Commission and the Canadian Securities Administrators) and has concluded that such disclosure controls and procedures are effective. There were no changes in our internal control over financial reporting during the quarter ended July 31, 2026, which materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Because of inherent limitations, disclosure controls and procedures and internal control over financial reporting can provide only reasonable assurance and may not prevent or detect misstatements. As in prior quarters, Bank of Montreal's Audit and Conduct Review Committee reviewed this document and Bank of Montreal’s Board of Directors approved the document prior to its release. 4 BMO Financial Group Third Quarter Report 2026
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Caution Regarding Forward-Looking Statements Bank of Montreal’s public communications often include written or oral forward-looking statements. Statements of this type are included in this document and may be included in other filings with Canadian securities regulators or the U.S. Securities and Exchange Commission, or in other communications. All such statements are made pursuant to the “safe harbor” provisions of, and are intended to be forward-looking statements under, the United States Private Securities Litigation Reform Act of 1995 and any applicable Canadian securities legislation. Forward-looking statements in this document may include, but are not limited to: statements with respect to our objectives and priorities for fiscal 2026 and beyond; our strategies or future actions; our targets and commitments; expectations for our financial condition, capital position, the regulatory environment in which we operate, the results of, or outlook for, our operations or the Canadian, U.S. and international economies; and include statements made by our management. Forward-looking statements are typically identified by words such as “will”, “would”, “should”, “believe”, “expect”, “anticipate”, “project”, “intend”, “estimate”, “plan”, “goal”, “commit”, “target”, “may”, “might”, “schedule”, “forecast”, “outlook”, “timeline”, “suggest”, “seek” and “could” or negative or grammatical variations thereof. By their nature, forward-looking statements require us to make assumptions and are subject to inherent risks and uncertainties, both general and specific in nature. There is significant risk that predictions, forecasts, conclusions or projections will not prove to be accurate, that our assumptions may not be correct, and that actual results may differ materially from such predictions, forecasts, conclusions or projections. We caution readers of this document not to place undue reliance on our forward-looking statements, as a number of factors – many of which are beyond our control and the effects of which can be difficult to predict – could cause actual future results, conditions, actions or events to differ materially from the targets, expectations, estimates or intentions expressed in the forward-looking statements. The future outcomes that relate to forward-looking statements may be influenced by many factors, including, but not limited to: general economic and market conditions in the countries in which we operate, including labour challenges and changes in foreign exchange and interest rates; political conditions, including changes relating to, or affecting, economic or trade matters, including tariffs, countermeasures and tariff mitigation policies; changes to our credit ratings; cyber and information security, including the threat of data breaches, hacking, identity theft and corporate espionage, as well as the possibility of denial of service resulting from efforts targeted at causing system failure and service disruption; technology resilience, innovation and competition; technological change, including the use of data and artificial intelligence (AI) in our business, including generative AI; failure of third parties to comply with their obligations to us; disruptions of global supply chains; environmental and social risk, including climate change; the Canadian housing market and consumer leverage; inflationary pressures; changes in laws, including tax legislation and interpretation, or in supervisory expectations or requirements, including capital, interest rate and liquidity requirements and guidance, including if the bank were designated a global systemically important bank, and the effect of such changes on funding costs, liquidity and capital requirements; changes in monetary, fiscal or economic policy; weak, volatile or illiquid capital or credit markets; the level of competition in the geographic and business areas in which we operate; exposure to, and the resolution of, significant litigation or regulatory matters, our ability to successfully appeal adverse outcomes of such matters and the timing, determination and recovery of amounts related to such matters; the accuracy and completeness of the information we obtain with respect to our customers and counterparties; our ability to successfully execute our strategic plans, complete acquisitions or dispositions and integrate acquisitions, including obtaining regulatory approvals, and realize any anticipated benefits from such plans and transactions; critical accounting estimates and judgments, and the effects of changes in accounting standards, rules and interpretations on these estimates; operational and infrastructure risks, including with respect to reliance on third parties; global capital markets activities; the emergence or continuation of widespread health emergencies or pandemics, and their impact on local, national or international economies, as well as their heightening of certain risks that may affect our future results; the possible effects on our business of war or terrorist activities; natural disasters, such as earthquakes or flooding, and disruptions to public infrastructure, such as transportation, communications, power or water supply; and our ability to anticipate and effectively manage risks arising from all of the foregoing factors. We caution that the foregoing list is not exhaustive of all possible factors. Other factors and risks could adversely affect our results. For further information, please refer to the discussion in the Risks That May Affect Future Results section, and the sections related to credit and counterparty, market, liquidity and funding, operational non-financial, legal and regulatory compliance, strategic, environmental and social, and reputation risk in the Enterprise-Wide Risk Management section of BMO’s 2025 Annual Report, and the Risk Management section in our Third Quarter 2026 Report to Shareholders, all of which outline certain key factors and risks that may affect our future results. Investors and others should carefully consider these factors and risks, as well as other uncertainties and potential events, and the inherent uncertainty of forward-looking statements. We do not undertake to update any forward-looking statements, whether written or oral, that may be made from time to time by the organization or on its behalf, except as required by law. The forward- looking information contained in this document is presented for the purpose of assisting shareholders and analysts in understanding our financial position as at and for the periods ended on the dates presented, as well as our strategic priorities and objectives, and may not be appropriate for other purposes. Material economic assumptions underlying the forward-looking statements contained in this document include those set out in the Economic Developments and Outlook section of BMO’s 2025 Annual Report, as updated in the Economic Developments and Outlook section and the Risk Management – Geopolitical and Trade Developments section in our Third Quarter 2026 Report to Shareholders, as well as in the Allowance for Credit Losses section of BMO’s 2025 Annual Report, as updated in the Allowance for Credit Losses section in our Third Quarter 2026 Report to Shareholders. Assumptions about the performance of the Canadian and U.S. economies, as well as overall market conditions and their combined effect on our business, are material factors we consider when determining our strategic priorities, objectives and expectations for our business. Assumptions about BMO expected financial performance (including balance sheet, income statement and regulatory capital figures), consideration received, applicable taxes, estimated values of transaction-related assets and liabilities, expected closing dates of the proposed divestitures, transaction costs, foreign exchange rates, and assumed accounting treatment were considered in estimating the impact of the divestitures on BMO's CET1 ratio. In determining our expectations for economic growth, we primarily consider historical economic data, past relationships between economic and financial variables, changes in government policies, and the risks to the domestic and global economy. BMO Financial Group Third Quarter Report 2026 5
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Economic Developments and Outlook (1) The North American economy has remained resilient, despite significant risks, including the escalation of the U.S.-Iran conflict and its potential to sharply increase energy, food and transportation costs, and ongoing trade and tariff uncertainty. The U.S. has imposed 50% tariffs on around 5% of goods imported from Canada. These tariffs took effect on August 22 and could potentially reduce Canada’s annual economic growth depending on the scope of retaliation by both countries, compared with the estimates noted below. The renegotiation of the United States-Mexico-Canada Agreement (USMCA) also poses a significant risk to trade policies and Canada’s economy. The U.S. government’s decision not to extend the previous agreement on July 1, 2026 was widely anticipated and sets the stage for annual reviews. Although talks could extend into next year, we expect Canada to retain the compliance exemption that allows most exports to enter the United States duty-free. After struggling to grow at the turn of the year, Canada’s economy is expected to return to a moderate expansion. Although constrained by elevated tariffs on certain key exports to the United States and weakness in some regional housing markets, the economy has benefited from Canada’s status as a large net exporter of resources at a time when energy and metal prices have risen in value. Real gross domestic product (GDP) is estimated to have increased more than 3% annualized in the second quarter of 2026, due to increases in exports, consumer spending and federal defence expenditures. The economy is projected to expand 1.0% in 2026, down from 1.9% in 2025, before strengthening to a 2.0% rate in 2027. The unemployment rate fell to 6.4% in July 2026 from 6.9% in July 2025 amid a rebound in employment growth and is anticipated to decline slightly further in the year ahead. Consumer price inflation was 3.0% year-over-year in July 2026, lifted by higher gasoline prices, but is projected to moderate over the next year, as oil prices ease. After reducing policy rates by a total of 100 basis points in 2025, the Bank of Canada is expected to maintain a steady policy rate to support the economy and employment. The Canadian dollar has weakened recently against a firm U.S. dollar, but is projected to strengthen moderately in the year ahead amid narrowing interest-rate differentials with the United States. Although housing market activity is showing signs of stabilization, it remains weak in Ontario and British Columbia due to affordability challenges and immigration restrictions. As a result, industry-wide growth in residential mortgage balances of 4.2% year-over-year in June 2026 is expected to remain moderate over the remainder of this year. Year-over-year growth in consumer credit (excluding mortgages) was firm at 4.8% in June 2026 and is expected to remain steady in the current year alongside stable interest rates. Industry-wide growth in non-financial corporate credit balances was 3.6% year-over-year in June 2026 and will likely remain subdued until trade-policy uncertainty eases. The U.S. economy continues to expand moderately. Real GDP grew at a slower annualized rate of 1.5% in the second quarter of 2026, held back by a decline in business inventories, but is estimated to have increased faster in the third quarter of 2026. Despite higher fuel costs, consumer spending remains well supported by increased tax refunds and the wealth effect from rising equity markets. Substantial investment in AI technologies and data centres continues to drive business spending. Real GDP is expected to increase 2.1% in 2026, similar to the pace in 2025, and to continue growing around 2.0% in 2027. The unemployment rate remained low at 4.1% in July 2026, held down by a shrinking labour force as a result of immigration restrictions and increased retirements. Consumer price inflation fell to 3.4% year-over-year in July 2026 from a recent peak of 4.2% in May amid lower fuel costs. We expect inflation to moderate further and average 2.3% in 2027, as energy prices retreat. The Federal Reserve is expected to maintain a stable policy rate in 2026 before shifting to a more accommodative stance in late 2027, as inflation returns to the 2% target. Longer-term interest rates are expected to decrease only modestly amid concerns about the large federal budget deficit. Growth in industry-wide residential mortgage balances was modest at 1.4% year-over-year in July 2026 amid continued weakness in home sales, and is likely to remain subdued until mortgage rates decline. Year-over-year growth in consumer loan balances improved to 5.5% in July 2026 and is projected to remain firm in 2026. Year-over-year growth in business, industrial and commercial real estate credit strengthened to 5.8% in July 2026 and is anticipated to remain strong over the rest of 2026, supported by AI-related investment demand. The economic outlook is subject to several risks that could impact the North American economy. The most immediate threat is a further escalation of the Iran war and a prolonged closure of the Strait of Hormuz, which would sharply increase energy and transportation costs. In addition, Canadian businesses face longer-term risks if the renegotiation of the USMCA is unsuccessful, as significant tariffs could then apply to most goods exported to the United States, potentially leading to a recession in Canada. Even under successful renegotiation of the USMCA, some tariffs are likely to remain in place, though government measures to promote investment in energy and resource projects could provide some offsetting support to the economy. Additional risks include a potential escalation of the Russia-Ukraine war and the possibility of a destabilizing correction in equity markets amid elevated valuations. Our operations, clients and customers may be affected by significant changes to the economic environment and heightened economic uncertainty. An increase in provisions for credit losses, volatility in capital markets and slower loan growth could result if tariffs increased substantially. Management regularly monitors the economic environment and takes proactive measures to respond to uncertainties and reduce the impact on our results. Caution This Economic Developments and Outlook section contains forward-looking statements. Please refer to the Caution Regarding Forward-Looking Statements. (1) All periods in this section refer to the calendar quarter and calendar year, rather than the fiscal quarter or fiscal year. 6 BMO Financial Group Third Quarter Report 2026
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Financial Highlights TABLE 1 (Canadian $ in millions, except as noted) Q3-2026 Q2-2026 Q3-2025 YTD-2026 YTD-2025 Summary Income Statement (1) Net interest income 5,567 5,268 5,496 16,478 15,991 Non-interest revenue 4,329 4,299 3,492 12,809 10,942 Revenue 9,896 9,567 8,988 29,287 26,933 Provision for credit losses on impaired loans 708 734 773 2,181 2,397 Provision for credit losses on performing loans 14 5 24 26 465 Total provision for credit losses (PCL) 722 739 797 2,207 2,862 Non-interest expense 6,678 5,330 5,105 17,761 15,551 Provision for income taxes 746 868 756 2,450 2,090 Net income 1,750 2,630 2,330 6,869 6,430 Net income attributable to non-controlling interest in subsidiaries 2 4 3 5 9 Dividends on preferred shares and distributions on other equity instruments 81 139 66 301 273 Net income available to common shareholders 1,667 2,487 2,261 6,563 6,148 Adjusted net income 2,859 2,733 2,399 8,143 6,734 Adjusted net income available to common shareholders 2,776 2,590 2,330 7,837 6,452 Common Share Data ($, except as noted) (1) Basic earnings per share 2.38 3.54 3.14 9.33 8.48 Diluted earnings per share 2.38 3.53 3.14 9.30 8.47 Adjusted diluted earnings per share 3.96 3.67 3.23 11.11 8.89 Book value per share 113.06 111.17 108.29 113.06 108.29 Closing share price 251.47 206.84 152.94 251.47 152.94 Number of common shares outstanding (in millions) End of period 697.1 700.4 716.3 697.1 716.3 Average basic 699.4 702.7 719.5 703.5 724.8 Average diluted 701.7 704.6 720.8 705.4 726.0 Market capitalization ($ millions) 175,311 144,874 109,552 175,311 109,552 Dividends declared per common share 1.71 1.67 1.63 5.05 4.81 Dividend yield (%) 2.7 3.2 4.3 2.7 4.2 Dividend payout ratio (%) 71.7 47.2 51.9 54.1 56.7 Adjusted dividend payout ratio (%) 43.1 45.3 50.3 45.3 54.0 Financial Measures and Ratios (%) (1) (2) Return on equity 8.4 13.0 11.6 11.1 10.5 Adjusted return on equity 14.0 13.5 12.0 13.3 11.1 Return on tangible common equity 11.3 17.3 15.6 14.9 14.3 Adjusted return on tangible common equity 18.0 17.6 15.6 17.2 14.5 Efficiency ratio 67.5 55.7 56.8 60.6 57.7 Adjusted efficiency ratio 54.9 54.4 55.8 55.7 56.2 Operating leverage (20.7) 4.0 4.2 (5.5) 9.8 Adjusted operating leverage 1.6 4.1 2.9 1.0 4.7 Net interest margin on average earning assets 1.60 1.61 1.69 1.63 1.64 Adjusted net interest margin, excluding Global Markets and Insurance 2.26 2.29 2.21 2.29 2.17 Effective tax rate 29.9 24.8 24.5 26.3 24.5 Adjusted effective tax rate 24.0 24.6 24.5 24.6 24.6 Total PCL-to-average net loans and acceptances 0.41 0.45 0.47 0.43 0.56 PCL on impaired loans-to-average net loans and acceptances 0.41 0.45 0.45 0.43 0.47 Balance Sheet and Other Information (as at, $ millions, except as noted) Assets 1,538,685 1,499,543 1,431,553 1,538,685 1,431,553 Average earning assets 1,379,889 1,342,662 1,287,815 1,352,419 1,305,339 Gross loans and acceptances 703,174 685,009 682,750 703,174 682,750 Net loans and acceptances 697,927 679,945 677,585 697,927 677,585 Deposits 1,017,834 966,901 955,363 1,017,834 955,363 Common shareholders’ equity 78,817 77,864 77,567 78,817 77,567 Total risk-weighted assets (3) 454,757 443,711 430,134 454,757 430,134 Assets under administration 913,942 896,603 810,244 913,942 810,244 Assets under management 603,542 571,768 464,182 603,542 464,182 Capital and Liquidity Measures (%) (3) Common Equity Tier 1 Ratio 13.0 13.0 13.5 13.0 13.5 Tier 1 Capital Ratio 14.7 14.7 15.5 14.7 15.5 Total Capital Ratio 16.6 16.9 17.8 16.6 17.8 Leverage Ratio 4.2 4.3 4.5 4.2 4.5 TLAC Ratio 29.2 29.0 29.5 29.2 29.5 Liquidity Coverage Ratio 125 128 130 125 130 Net Stable Funding Ratio 114 114 118 114 118 Foreign Exchange Rates ($) As at Canadian/U.S. dollar 1.4019 1.3584 1.3847 1.4019 1.3847 Average Canadian/U.S. dollar 1.4004 1.3721 1.3730 1.3829 1.4077 (1) Adjusted results exclude certain items from reported results and are used to calculate our adjusted measures as presented in the table above. Management assesses performance on a reported basis and an adjusted basis, and considers both to be useful. For further information, refer to the Non-GAAP and Other Financial Measures section. (2) PCL, ROE and ROTCE ratios are presented on an annualized basis. (3) Capital and liquidity measures are disclosed in accordance with the Capital Adequacy Requirements (CAR) Guideline and the Liquidity Adequacy Requirements (LAR) Guideline, as set out by the Office of the Superintendent of Financial Institutions (OSFI), as applicable. Certain comparative figures have been reclassified to conform with the current period’s presentation. BMO Financial Group Third Quarter Report 2026 7
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Non-GAAP and Other Financial Measures Results and measures in this document are presented on a generally accepted accounting principles (GAAP) basis. Unless otherwise indicated, all amounts are in Canadian dollars and have been derived from our audited annual consolidated financial statements and our unaudited interim consolidated financial statements, prepared in accordance with International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board (IASB). References to GAAP mean IFRS. We use a number of financial measures to assess our performance, as well as the p e r f o r m a n c e o f o u r o p e r a t i n g s e g m e n t s , i n c l u d i n g a m o u n t s , m e a s u r e s a n d r a t i o s t h a t a r e p r e s e n t e d o n a n o n - G A A P b a s i s , a s d e s c r i b e d b e l o w . W e b e l i e v e t h a t t h e s e n o n - G A A P a m o u n t s , m e a s u r e s a n d r a t i o s , r e a d t o g e t h e r w i t h o u r G A A P r e s u l t s , p r o v i d e r e a d e r s w i t h a b e t t e r u n d e r s t a n d i n g o f h o w management assesses results. Non-GAAP amounts, measures and ratios do not have standardized meanings under GAAP. They are unlikely to be comparable to similar measures presented by other companies and should not be viewed in isolation from, or as a substitute for, GAAP results. For further information regarding the composition of our non-GAAP and other financial measures, including supplementary financial measures, refer to the Glossary of Financial Terms. Adjusted measures and ratios Management considers both reported and adjusted results and measures to be useful in assessing underlying ongoing business performance. Adjusted r e s u l t s a n d m e a s u r e s r e m o v e c e r t a i n s p e c i f i e d i t e m s f r o m r e v e n u e , n o n - i n t e r e s t e x p e n s e a n d i n c o m e t a x e s , a s d e t a i l e d i n t h e f o l l o w i n g t a b l e . A d j u s t e d r e s u l t s a n d m e a s u r e s p r e s e n t e d i n t h i s d o c u m e n t a r e n o n - G A A P . P r e s e n t i n g r e s u l t s o n b o t h a r e p o r t e d a n d a n a d j u s t e d b a s i s p e r m i t s r e a d e r s to assess the impact of certain items on results for the periods presented, and to better assess results excluding those items that may not reflect ongoing business performance. As such, the presentation may facilitate readers’ analysis of underlying trends. Except as otherwise noted, management’s discussion of changes in reported results in this document applies equally to changes in the corresponding adjusted results. Net Interest Margin, excluding Global Markets and Insurance Effective the first quarter of fiscal 2026, we report net interest margin on a basis that excludes net interest income from our Global Markets business in Capital Markets, and average earning assets from our Global Markets and Insurance businesses. Management considers this measure to be useful in allowing readers to assess performance of BMO’s lending, investing and deposit-raising activities without the volatility that may be associated with market and trading-related activities. This measure replaces net interest margin, excluding trading and insurance previously disclosed, and prior periods have been reclassified to conform with the current period’s presentation. Tangible common equity and return on tangible common equity Tangible common equity is calculated as common shareholders’ equity, less goodwill and acquisition-related intangible assets, net of related deferred tax liabilities. Return on tangible common equity (ROTCE) is calculated as net income available to common shareholders, adjusted for the amortization of acquisition-related intangible assets and any impairments, as a percentage of average tangible common equity. ROTCE is commonly used in the North American banking industry and is meaningful as a consistent measure of the performance of businesses, whether they were acquired or developed organically. Adjusting Items Adjusted results in the current quarter and prior periods excluded the following items: • Impact of divestitures of $1,106 million ($973 million after-tax) in the current quarter included the announced sale of BMO’s Transportation Finance and Vendor Finance businesses resulting in a charge of $1,092 million ($962 million after-tax), primarily related to goodwill, as well as divestiture- related costs related to the announced sale of 138 branches in select U.S. markets of $14 million ($10 million after-tax). Prior periods included costs related to the sale of branches of $26 million ($24 million after-tax) in Q2-2026 and $4 million ($3 million after-tax) in Q1-2026. Amounts are recorded in non-interest expense in Corporate Services. • Acquisition and integration costs of $6 million ($4 million after-tax) in the current quarter. Prior periods included expenses of $3 million ($2 million after-tax) in Q2-2026, $9 million ($7 million after-tax) in Q1-2026, $5 million ($4 million after-tax) in Q3-2025, a reversal of $2 million ($1 million after-tax) in Q2-2025 and expenses of $10 million ($7 million after-tax) in Q1-2025. Amounts are recorded in non-interest expense in the related operating segment: Burgundy in Wealth Management and Bank of the West in Corporate Services. • Amortization of acquisition-related intangible assets of $94 million ($69 million after-tax) in the current quarter. Prior periods included $93 million ($70 million after-tax) in Q2-2026, $96 million ($71 million after-tax) in Q1-2026, $93 million ($69 million after-tax) in Q3-2025, $109 million ($81 million after-tax) in Q2-2025 and $106 million ($79 million after-tax) in Q1-2025. Amounts are recorded in non-interest expense in the related operating segment. • Change in fair value of contingent consideration related to the acquisition of Burgundy, recorded in non-interest revenue in Wealth Management. The increase in contingent consideration and reduction in non-interest revenue was $63 million (pre-tax and after-tax) in the current quarter, $7 million (pre-tax and after-tax) in Q2-2026 and $16 million (pre-tax and after-tax) in Q1-2026. For further information, refer to Note 13 of the unaudited interim consolidated financial statements and Note 9 of the audited annual consolidated financial statements of BMO’s 2025 Annual Report. 8 BMO Financial Group Third Quarter Report 2026
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• U.S. Federal Deposit Insurance Corporation (FDIC) special assessment recorded in non-interest expense in Corporate Services. Q1-2026 included a partial reversal of a prior charge of $47 million ($35 million after-tax). Prior periods included a partial reversal of $5 million ($4 million after-tax) in Q3-2025, expenses of $5 million ($4 million after-tax) in Q2-2025 and a partial reversal of $7 million ($5 million after-tax) in Q1-2025. • Impact of aligning accounting policies for employee vacation across legal entities of $96 million ($70 million after-tax) in Q1-2025, recorded in non-interest expense in Corporate Services. Adjusting items in aggregate decreased net income by $1,109 million in the current quarter, compared with a $69 million decrease in the prior year and a decrease of $103 million in the prior quarter. On a year-to-date basis, adjusting items in aggregate decreased net income by $1,274 million, compared with a decrease of $304 million in the prior year. Non-GAAP and Other Financial Measures (1) TABLE 2 (Canadian $ in millions, except as noted) Q3-2026 Q2-2026 Q3-2025 YTD-2026 YTD-2025 Reported Results Net interest income 5,567 5,268 5,496 16,478 15,991 Non-interest revenue 4,329 4,299 3,492 12,809 10,942 Revenue 9,896 9,567 8,988 29,287 26,933 Provision for credit losses 722 739 797 2,207 2,862 Non-interest expense 6,678 5,330 5,105 17,761 15,551 Income before income taxes 2,496 3,498 3,086 9,319 8,520 Provision for income taxes 746 868 756 2,450 2,090 Net income 1,750 2,630 2,330 6,869 6,430 Dividends on preferred shares and distributions on other equity instruments 81 139 66 301 273 Net income (loss) attributable to non-controlling interest in subsidiaries 2 4 3 5 9 Net income available to common shareholders 1,667 2,487 2,261 6,563 6,148 Diluted EPS ($) 2.38 3.53 3.14 9.30 8.47 Adjusting Items Impacting Revenue (Pre-tax) Change in fair value of contingent consideration (2) (63) (7) – (86) – Impact of adjusting items on revenue (pre-tax) (63) (7) – (86) – Adjusting Items Impacting Non-Interest Expense (Pre-tax) Acquisition and integration costs (6) (3) (5) (18) (13) Amortization of acquisition-related intangible assets (3) (94) (93) (93) (283) (308) Impact of divestitures (1,106) (26) – (1,136) – FDIC special assessment – – 5 47 7 Impact of alignment of accounting policies – – – – (96) Impact of adjusting items on non-interest expense (pre-tax) (1,206) (122) (93) (1,390) (410) Adjusting Items Impacting Revenue (After-tax) Change in fair value of contingent consideration (2) (63) (7) – (86) – Impact of adjusting items on revenue (after-tax) (63) (7) – (86) – Adjusting Items Impacting Non-Interest Expense (After-tax) Acquisition and integration costs (4) (2) (4) (13) (10) Amortization of acquisition-related intangible assets (3) (69) (70) (69) (210) (229) Impact of divestitures (973) (24) – (1,000) – FDIC special assessment – – 4 35 5 Impact of alignment of accounting policies – – – – (70) Impact of adjusting items on non-interest expense (after-tax) (1,046) (96) (69) (1,188) (304) Impact of adjusting items on reported net income (after-tax) (1,109) (103) (69) (1,274) (304) Impact on diluted EPS ($) (1.58) (0.14) (0.09) (1.81) (0.42) Adjusted Results Net interest income 5,567 5,268 5,496 16,478 15,991 Non-interest revenue 4,392 4,306 3,492 12,895 10,942 Revenue 9,959 9,574 8,988 29,373 26,933 Provision for credit losses 722 739 797 2,207 2,862 Non-interest expense 5,472 5,208 5,012 16,371 15,141 Income before income taxes 3,765 3,627 3,179 10,795 8,930 Provision for income taxes 906 894 780 2,652 2,196 Net income 2,859 2,733 2,399 8,143 6,734 Net income available to common shareholders 2,776 2,590 2,330 7,837 6,452 Diluted EPS ($) 3.96 3.67 3.23 11.11 8.89 (1) Adjusted results exclude certain items from reported results and are used to calculate our adjusted measures as presented in the table above. Refer to the commentary in this Non-GAAP and Other Financial Measures section for further information on adjusting items. (2) Recorded in non-interest revenue. (3) Represents amortization of acquisition-related intangible assets and any impairment. BMO Financial Group Third Quarter Report 2026 9
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Summary of Reported and Adjusted Results by Operating Segment TABLE 3 Wealth Capital Corporate U.S. Operations (1) (Canadian $ in millions, except as noted) Canadian P&C U.S. Banking Management Markets Services Total Bank (US$ in millions) Q3-2026 Reported net income (loss) 980 868 408 645 (1,151) 1,750 68 Dividends on preferred shares and distributions on other equity instruments 12 15 2 15 37 81 16 Net income attributable to non-controlling interest in subsidiaries – 1 – – 1 2 1 Net income (loss) available to common shareholders 968 852 406 630 (1,189) 1,667 51 Acquisition and integration costs – – 4 – – 4 – Amortization of acquisition-related intangible assets 3 57 5 4 – 69 42 Change in fair value of contingent consideration – – 63 – – 63 – Impact of divestitures – – – – 973 973 684 Adjusted net income (loss) (2) 983 925 480 649 (178) 2,859 794 Adjusted net income (loss) available to common shareholders (2) 971 909 478 634 (216) 2,776 777 Q2-2026 Reported net income (loss) 884 790 428 638 (110) 2,630 655 Dividends on preferred shares and distributions on other equity instruments 11 14 1 15 98 139 15 Net income attributable to non-controlling interest in subsidiaries – 4 – – – 4 3 Net income (loss) available to common shareholders 873 772 427 623 (208) 2,487 637 Acquisition and integration costs – – 2 – – 2 – Amortization of acquisition-related intangible assets 3 57 7 3 – 70 43 Change in fair value of contingent consideration – – 7 – – 7 – Impact of divestitures – – – – 24 24 18 Adjusted net income (loss) (2) 887 847 444 641 (86) 2,733 716 Adjusted net income (loss) available to common shareholders (2) 876 829 443 626 (184) 2,590 698 Q3-2025 Reported net income (loss) 849 767 392 442 (120) 2,330 661 Dividends on preferred shares and distributions on other equity instruments 12 15 1 11 27 66 3 Net income attributable to non-controlling interest in subsidiaries – 2 – – 1 3 3 Net income (loss) available to common shareholders 837 750 391 431 (148) 2,261 655 Acquisition and integration costs – – 3 – 1 4 1 Amortization of acquisition-related intangible assets 3 62 – 4 – 69 47 FDIC special assessment – – – – (4) (4) (3) Adjusted net income (loss) (2) 852 829 395 446 (123) 2,399 706 Adjusted net income (loss) available to common shareholders (2) 840 812 394 435 (151) 2,330 700 YTD-2026 Reported net income (loss) 2,812 2,400 1,188 1,940 (1,471) 6,869 1,438 Dividends on preferred shares and distributions on other equity instruments 36 43 5 45 172 301 48 Net income attributable to non-controlling interest in subsidiaries – 3 – – 2 5 3 Net income (loss) available to common shareholders 2,776 2,354 1,183 1,895 (1,645) 6,563 1,387 Acquisition and integration costs – – 13 – – 13 – Amortization of acquisition-related intangible assets 9 174 17 10 – 210 131 Change in fair value of contingent consideration – – 86 – – 86 – Impact of divestitures – – – – 1,000 1,000 704 FDIC special assessment – – – – (35) (35) (26) Adjusted net income (loss) (2) 2,821 2,574 1,304 1,950 (506) 8,143 2,247 Adjusted net income (loss) available to common shareholders (2) 2,785 2,528 1,299 1,905 (680) 7,837 2,196 (1) U.S. Operations comprises reported and adjusted results recorded in U.S. Banking, and the U.S. operations in Capital Markets and Corporate Services. (2) Refer to the commentary in this Non-GAAP and Other Financial Measures section for details on adjusting items. Certain comparative figures have been reclassified to conform with the current period’s presentation. 10 BMO Financial Group Third Quarter Report 2026
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Summary of Reported and Adjusted Results by Operating Segment (Continued) TABLE 3 (Continued) Wealth Capital Corporate U.S. Operations (1) (Canadian $ in millions, except as noted) Canadian P&C U.S. Banking Management Markets Services Total Bank (US$ in millions) YTD-2025 Reported net income (loss) 2,490 2,003 1,040 1,465 (568) 6,430 1,815 Dividends on preferred shares and distributions on other equity instruments 35 46 4 31 157 273 9 Net income attributable to non-controlling interest in subsidiaries – 7 – – 2 9 7 Net income (loss) available to common shareholders 2,455 1,950 1,036 1,434 (727) 6,148 1,799 Acquisition and integration costs – – 3 – 7 10 5 Amortization of acquisition-related intangible assets 10 208 – 11 – 229 153 FDIC special assessment – – – – (5) (5) (4) Impact of alignment of accounting policies – – – – 70 70 25 Adjusted net income (loss) (2) 2,500 2,211 1,043 1,476 (496) 6,734 1,994 Adjusted net income (loss) available to common shareholders (2) 2,465 2,158 1,039 1,445 (655) 6,452 1,978 See previous page for footnote references. Certain comparative figures have been reclassified to conform with the current period’s presentation. Return on Equity and Return on Tangible Common Equity TABLE 4 (Canadian $ in millions, except as noted) Q3-2026 Q2-2026 Q3-2025 YTD-2026 YTD-2025 Reported net income 1,750 2,630 2,330 6,869 6,430 Net income attributable to non-controlling interest in subsidiaries 2 4 3 5 9 Net income attributable to bank shareholders 1,748 2,626 2,327 6,864 6,421 Dividends on preferred shares and distributions on other equity instruments 81 139 66 301 273 Net income available to common shareholders (A) 1,667 2,487 2,261 6,563 6,148 After-tax amortization of acquisition-related intangible assets 69 70 69 210 229 Net income available to common shareholders after adjusting for amortization of acquisition-related intangible assets (B) 1,736 2,557 2,330 6,773 6,377 After-tax impact of other adjusting items (1) 1,040 33 – 1,064 75 Adjusted net income available to common shareholders (C) 2,776 2,590 2,330 7,837 6,452 Average common shareholders’ equity (D) 78,960 78,641 77,048 78,895 77,996 Goodwill (16,179) (16,762) (16,536) (16,591) (16,943) Acquisition-related intangible assets (2,281) (2,289) (2,234) (2,300) (2,382) Net of related deferred tax liabilities 760 837 935 817 976 Average tangible common equity (E) 61,260 60,427 59,213 60,821 59,647 Return on equity (%) (= A/D) (2) 8.4 13.0 11.6 11.1 10.5 Adjusted return on equity (%) (= C/D) (2) 14.0 13.5 12.0 13.3 11.1 Return on tangible common equity (%) (= B/E) (2) 11.3 17.3 15.6 14.9 14.3 Adjusted return on tangible common equity (%) (= C/E) (2) 18.0 17.6 15.6 17.2 14.5 (1) Refer to the commentary in this Non-GAAP and Other Financial Measures section for details on adjusting items. (2) Quarterly calculations are on an annualized basis. BMO Financial Group Third Quarter Report 2026 11
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Return on Equity by Operating Segment (1) TABLE 5 Wealth Capital Corporate U.S. Operations (2) (Canadian $ in millions, except as noted) Canadian P&C U.S. Banking Management Markets Services Total Bank (US$ in millions) Q3-2026 Reported Net income (loss) available to common shareholders 968 852 406 630 (1,189) 1,667 51 Total average common equity 16,830 36,658 4,480 15,600 5,392 78,960 32,623 Return on equity (%) 22.8 9.2 35.9 16.0 na 8.4 0.6 Adjusted (3) Net income (loss) available to common shareholders 971 909 478 634 (216) 2,776 777 Total average common equity 16,830 36,658 4,480 15,600 5,392 78,960 32,623 Return on equity (%) 22.9 9.8 42.4 16.1 na 14.0 9.5 Q2-2026 Reported Net income (loss) available to common shareholders 873 772 427 623 (208) 2,487 637 Total average common equity 16,691 36,658 4,402 15,362 5,528 78,641 33,130 Return on equity (%) 21.4 8.6 39.8 16.6 na 13.0 7.9 Adjusted (3) Net income (loss) available to common shareholders 876 829 443 626 (184) 2,590 698 Total average common equity 16,691 36,658 4,402 15,362 5,528 78,641 33,130 Return on equity (%) 21.5 9.3 41.3 16.7 na 13.5 8.6 Q3-2025 Reported Net income (loss) available to common shareholders 837 750 391 431 (148) 2,261 655 Total average common equity 16,764 36,298 2,992 13,586 7,408 77,048 32,462 Return on equity (%) 19.8 8.2 51.8 12.6 na 11.6 8.0 Adjusted (3) Net income (loss) available to common shareholders 840 812 394 435 (151) 2,330 700 Total average common equity 16,764 36,298 2,992 13,586 7,408 77,048 32,462 Return on equity (%) 19.9 8.9 52.2 12.7 na 12.0 8.6 YTD-2026 Reported Net income (loss) available to common shareholders 2,776 2,354 1,183 1,895 (1,645) 6,563 1,387 Total average common equity 16,641 36,705 4,360 15,394 5,795 78,895 32,966 Return on equity (%) 22.3 8.6 36.3 16.5 na 11.1 5.6 Adjusted (3) Net income (loss) available to common shareholders 2,785 2,528 1,299 1,905 (680) 7,837 2,196 Total average common equity 16,641 36,705 4,360 15,394 5,795 78,895 32,966 Return on equity (%) 22.4 9.2 39.8 16.5 na 13.3 8.9 YTD-2025 Reported Net income (loss) available to common shareholders 2,455 1,950 1,036 1,434 (727) 6,148 1,799 Total average common equity 16,679 37,282 3,022 13,679 7,334 77,996 32,605 Return on equity (%) 19.7 7.0 45.8 14.0 na 10.5 7.4 Adjusted (3) Net income (loss) available to common shareholders 2,465 2,158 1,039 1,445 (655) 6,452 1,978 Total average common equity 16,679 37,282 3,022 13,679 7,334 77,996 32,605 Return on equity (%) 19.8 7.8 46.0 14.1 na 11.1 8.1 (1) Return on equity is based on allocated capital. Capital is allocated to the operating segments based on the amount of regulatory capital required to support business activities, including risk-weighted assets and capital deductions, with unallocated capital reported in Corporate Services. Effective the first quarter of fiscal 2026, the allocation approach was updated to primarily reflect an increase in the capital allocation rate to 12.5% of risk-weighted assets, compared with 12.0% in fiscal 2025. Capital allocation methodologies are reviewed annually. For further information, refer to the How BMO Reports Operating Segments Results section. Return on equity ratios are presented on an annualized basis. (2) U.S. Operations comprises reported and adjusted results and allocated capital recorded in U.S. Banking, and the U.S. operations in Capital Markets and Corporate Services. (3) Refer to the commentary in this Non-GAAP and Other Financial Measures section for details on adjusting items. na - not applicable Certain comparative figures have been reclassified to conform with the current period’s presentation. Caution This Non-GAAP and Other Financial Measures section contains forward-looking statements. Please refer to the Caution Regarding Forward-Looking Statements. 12 BMO Financial Group Third Quarter Report 2026
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Impact of Foreign Exchange TABLE 6 Q3-2026 YTD-2026 (Canadian $ in millions, except as noted) vs. Q3-2025 vs. Q2-2026 vs. YTD-2025 Canadian/U.S. dollar exchange rate (average) Current period 1.4004 1.4004 1.3829 Prior period 1.3730 1.3721 1.4077 Increased/(Decreased) Effects on U.S. Operations reported results Net interest income 49 50 (133) Non-interest revenue 25 28 (69) Total revenue 74 78 (202) Provision for credit losses (4) (5) 19 Non-interest expense (47) (49) 126 Provision for income taxes (5) (5) 12 Net income 18 19 (45) Impact on basic earnings per share ($) 0.02 0.03 (0.06) Impact on diluted earnings per share ($) 0.02 0.03 (0.06) Effects on U.S. Operations adjusted results (1) Net interest income 49 50 (133) Non-interest revenue 25 28 (69) Total revenue 74 78 (202) Provision for credit losses (4) (5) 19 Non-interest expense (45) (47) 120 Provision for income taxes (6) (6) 13 Net income 19 20 (50) Impact on basic earnings per share ($) 0.03 0.03 (0.07) Impact on diluted earnings per share ($) 0.03 0.03 (0.07) (1) Adjusted results are on a non-GAAP basis and are discussed in the Non-GAAP and Other Financial Measures section. The table above indicates the relevant average Canadian/U.S. dollar exchange rates and the impact of changes in those rates on reported and adjusted results in BMO’s U.S. operations, comprising U.S. Banking and the U.S. operations in Capital Markets and Corporate Services. The Canadian dollar equivalents of BMO’s U.S. operations results that are denominated in U.S. dollars increased in the third quarter of fiscal 2026, relative to the second quarter of fiscal 2026 and the third quarter of fiscal 2025, due to changes in the Canadian/U.S. dollar exchange rate. References in this document to the impact of the U.S. dollar do not include U.S. dollar-denominated amounts recorded outside of BMO’s U.S. operations. Economically, our U.S. dollar income stream was not hedged against the risk of changes in foreign exchange rates during fiscal 2026 and fiscal 2025. Changes in exchange rates will affect future results measured in Canadian dollars, and the impact on those results is a function of the periods in which revenue, expenses and provisions for (or recoveries of) credit losses and income taxes arise. Refer to the Enterprise-Wide Capital Management section of BMO’s 2025 Annual MD&A for a discussion of the impact that changes in foreign exchange rates can have on BMO’s capital position. Net Income Q3 2026 vs. Q3 2025 Reported net income was $1,750 million, a decrease of $580 million or 25% from the prior year, and adjusted net income was $2,859 million, an increase of $460 million or 19%. Reported earnings per share (EPS) was $2.38, a decrease of $0.76 or 24% from the prior year, and adjusted EPS was $3.96, an increase of $0.73 or 22%. The decrease in reported results was primarily driven by a charge related to the reduction in goodwill associated with the announced sale of BMO’s Transportation Finance and Vendor Finance businesses and a change in fair value of contingent consideration related to the acquisition of Burgundy. The increase in adjusted net income was driven by higher revenue, as well as a lower provision for credit losses, partially offset by higher expenses. Reported and adjusted net income increased across all operating segments. Corporate Services recorded a higher net loss, compared with the prior year, on both a reported and an adjusted basis. Q3 2026 vs. Q2 2026 Reported net income decreased $880 million or 33% from the prior quarter, and adjusted net income increased $126 million or 5%. Reported EPS decreased $1.15 or 33% from the prior quarter, and adjusted EPS increased $0.29 or 8%, reflecting higher net income and lower dividends on preferred shares and distributions on other equity instruments. The decrease in reported results was primarily due to the impact of the items noted above. The increase in adjusted net income was driven by higher revenue and a lower provision for credit losses, partially offset by higher expenses. Reported and adjusted net income increased in Canadian P&C, U.S. Banking and Capital Markets, while net income in Wealth Management decreased on a reported basis and increased on an adjusted basis. Corporate Services recorded a higher net loss, compared with the prior quarter, on both a reported and an adjusted basis. BMO Financial Group Third Quarter Report 2026 13
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Q3 YTD 2026 vs. Q3 YTD 2025 Reported net income was $6,869 million, an increase of $439 million or 7% from the prior year, and adjusted net income was $8,143 million, an increase of $1,409 million or 21%. Reported EPS was $9.30, an increase of $0.83 or 10% from the prior year, and adjusted EPS was $11.11, an increase of $2.22 or 25%. The change in reported results reflected the impact of the items noted above, as well as the impact of aligning accounting policies for employee vacation across legal entities in the prior year and a larger partial reversal of the FDIC special assessment in the current year. The increase in reported and adjusted results reflected higher revenue and a lower provision for credit losses, partially offset by higher expenses. Reported and adjusted net income increased across all operating segments. Corporate Services recorded a higher net loss, compared with the prior year, on both a reported and an adjusted basis. Refer to the Non-GAAP and Other Financial Measures section for further information on non-GAAP amounts, measures and ratios, including adjusting items in this Net Income section. Revenue Q3 2026 vs. Q3 2025 Reported revenue was $9,896 million, an increase of $908 million or 10% from the prior year, and adjusted revenue was $9,959 million, an increase of $971 million or 11%. Adjusted revenue excluded the impact of a change in fair value of contingent consideration related to the acquisition of Burgundy. Reported and adjusted revenue increased across all operating segments and decreased in Corporate Services. Reported and adjusted net interest income was $5,567 million, an increase of $71 million from the prior year, and included a decrease in Global Markets net interest income of $182 million, which was offset in trading non-interest revenue. Net interest income, excluding Global Markets, increased $253 million, with higher net interest margin and balance growth across businesses, partially offset by lower net interest income in Corporate Services. BMO’s overall reported net interest margin of 1.60% decreased 9 basis points from the prior year, primarily due to lower net interest income in Global Markets. Net interest margin, excluding Global Markets and Insurance, was 2.26%, an increase of 5 basis points, primarily due to higher deposit margins, partially offset by lower net interest income and higher low-yielding assets in Corporate Services. Reported non-interest revenue was $4,329 million, an increase of $837 million or 24% from the prior year, and adjusted non-interest revenue was $4,392 million, an increase of $900 million or 26%, with increases across most categories, primarily driven by higher trading revenue, wealth management fees, and underwriting and advisory fee revenue, partially offset by the impact of a gain on the sale of a non-strategic portfolio of insurance contracts in the prior year. Trading non-interest revenue of $850 million increased $444 million from the prior year. Q3 2026 vs. Q2 2026 Reported revenue increased $329 million or 3% from the prior quarter, and adjusted revenue increased $385 million or 4%. Revenue increased across all operating segments and decreased in Corporate Services. Reported and adjusted net interest income increased $299 million or 6% from the prior quarter, driven by the impact of three additional days in the current quarter, balance growth across businesses and higher net interest income in Global Markets, partially offset by lower net interest income in Corporate Services. BMO’s overall reported net interest margin decreased 1 basis point. Net interest margin, excluding Global Markets and Insurance, decreased 3 basis points, primarily due to lower net interest income and higher low-yielding assets in Corporate Services, partially offset by higher deposit margins. Reported non-interest revenue increased $30 million or 1% from the prior quarter, and adjusted non-interest revenue increased $86 million or 2%, primarily due to higher wealth management fees and lending fee revenue, partially offset by lower trading non-interest revenue and lower securities gains, excluding trading. Q3 YTD 2026 vs. Q3 YTD 2025 Reported revenue was $29,287 million, an increase of $2,354 million or 9% from the prior year, and adjusted revenue was $29,373 million, an increase of $2,440 million or 9%. Reported and adjusted revenue increased across all operating segments and in Corporate Services. Reported and adjusted net interest income was $16,478 million, an increase of $487 million or 3% from the prior year, driven by higher net interest margin, balance growth across businesses and higher net interest income in Corporate Services, partially offset by lower balances and lower net interest income in Global Markets. Global Markets net interest income decreased $212 million from the prior year, and was offset in trading non-interest revenue. BMO’s overall reported net interest margin of 1.63% decreased 1 basis point from the prior year. Net interest margin, excluding Global Markets and Insurance, was 2.29%, an increase of 12 basis points, primarily due to higher deposit margins, as well as higher net interest income and lower low-yielding assets in Corporate Services. Reported non-interest revenue was $12,809 million, an increase of $1,867 million or 17% from the prior year, and adjusted non-interest revenue was $12,895 million, an increase of $1,953 million or 18%, with increases across most categories, including higher wealth management fees, trading revenue, underwriting and advisory fee revenue, securities commissions and fees and card fee revenue, which included the impact of revised future redemption assumptions and lower payment processing costs in the current year. Trading non-interest revenue of $2,599 million increased $572 million from the prior year. Net interest income and non-interest revenue are detailed in the unaudited interim consolidated financial statements. 14 BMO Financial Group Third Quarter Report 2026
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Refer to the Non-GAAP and Other Financial Measures section for further information on non-GAAP amounts, measures and ratios, including adjusting items in this Revenue section. Change in Net Interest Income, Average Earning Assets and Net Interest Margin (1) TABLE 7 (Canadian $ in millions, except as noted) Net interest income (teb) (2) Average earning assets (3) Net interest margin (in basis points) Q3-2026 Q2-2026 Q3-2025 Q3-2026 Q2-2026 Q3-2025 Q3-2026 Q2-2026 Q3-2025 Canadian P&C 2,558 2,425 2,459 349,292 345,907 343,805 290 288 284 U.S. Banking 2,390 2,217 2,221 235,937 225,426 230,849 402 403 382 All other operating segments and Corporate Services 619 626 816 794,660 771,329 713,161 na na na Total reported 5,567 5,268 5,496 1,379,889 1,342,662 1,287,815 160 161 169 Global Markets net interest income, and Global Markets and Insurance assets 262 204 444 446,712 435,373 381,896 na na na Total reported, excluding Global Markets and Insurance 5,305 5,064 5,052 933,177 907,289 905,919 226 229 221 U.S. Banking (US$ in millions) 1,707 1,615 1,617 168,477 164,298 168,134 402 403 382 (Canadian $ in millions, except as noted) Net interest income (teb) (2) Average earning assets (3) Net interest margin (in basis points) YTD-2026 YTD-2025 YTD-2026 YTD-2025 YTD-2026 YTD-2025 Canadian P&C 7,506 7,203 346,697 341,670 289 282 U.S. Banking 6,874 6,783 228,772 238,149 402 381 All other operating segments and Corporate Services 2,098 2,005 776,950 725,520 na na Total reported 16,478 15,991 1,352,419 1,305,339 163 164 Global Markets net interest income, and Global Markets and Insurance assets 835 1,047 439,486 384,560 na na Total reported, excluding Global Markets and Insurance 15,643 14,944 912,933 920,779 229 217 U.S. Banking (US$ in millions) 4,970 4,818 165,409 169,158 402 381 (1) Adjusted results and ratios in this table are on a non-GAAP basis and are discussed in the Non-GAAP and Other Financial Measures section. (2) Operating segment revenue is presented on a taxable equivalent basis (teb) in net interest income. For further information, refer to the How BMO Reports Operating Segments Results section in BMO’s 2025 Annual MD&A. (3) Average earning assets represents the daily average balance of interest bearing deposits at central banks, deposits with other banks, securities borrowed or purchased under resale agreement, securities and loans over a period. na – not applicable Certain comparative figures have been reclassified to conform with the current period’s presentation. Total Provision for Credit Losses TABLE 8 Wealth Capital Corporate (Canadian $ in millions) Canadian P&C U.S. Banking Management Markets Services Total Bank Q3-2026 Provision for credit losses on impaired loans 447 223 2 30 6 708 Provision (recovery of provision) for credit losses on performing loans 60 (50) (3) 11 (4) 14 Total provision (recovery of provision) for credit losses 507 173 (1) 41 2 722 Total PCL-to-average net loans and acceptances (%) (1) 0.58 0.30 (0.02) 0.18 nm 0.41 PCL on impaired loans-to-average net loans and acceptances (%) (1) 0.52 0.39 0.01 0.14 nm 0.41 Q2-2026 Provision for credit losses on impaired loans 477 237 1 15 4 734 Provision (recovery of provision) for credit losses on performing loans 42 (53) 6 14 (4) 5 Total provision for credit losses 519 184 7 29 – 739 Total PCL-to-average net loans and acceptances (%) (1) 0.62 0.35 0.09 0.14 nm 0.45 PCL on impaired loans-to-average net loans and acceptances (%) (1) 0.57 0.46 0.02 0.07 nm 0.45 Q3-2025 Provision for credit losses on impaired loans 489 241 1 33 9 773 Provision (recovery of provision) for credit losses on performing loans 76 (70) 2 23 (7) 24 Total provision for credit losses 565 171 3 56 2 797 Total PCL-to-average net loans and acceptances (%) (1) 0.66 0.31 0.04 0.27 nm 0.47 PCL on impaired loans-to-average net loans and acceptances (%) (1) 0.57 0.44 0.02 0.16 nm 0.45 YTD-2026 Provision for credit losses on impaired loans 1,421 662 5 74 19 2,181 Provision (recovery of provision) for credit losses on performing loans 120 (86) (1) 4 (11) 26 Total provision for credit losses 1,541 576 4 78 8 2,207 Total PCL-to-average net loans and acceptances (%) (1) 0.60 0.36 0.02 0.12 nm 0.43 PCL on impaired loans-to-average net loans and acceptances (%) (1) 0.56 0.41 0.02 0.11 nm 0.43 YTD-2025 Provision for credit losses on impaired loans 1,456 801 3 96 41 2,397 Provision (recovery of provision) for credit losses on performing loans 259 123 3 107 (27) 465 Total provision for credit losses 1,715 924 6 203 14 2,862 Total PCL-to-average net loans and acceptances (%) (1) 0.68 0.55 0.03 0.32 nm 0.56 PCL on impaired loans-to-average net loans and acceptances (%) (1) 0.58 0.47 0.02 0.15 nm 0.47 (1) PCL ratios are presented on an annualized basis. nm – not meaningful Certain comparative figures have been reclassified to conform with the current year’s presentation. BMO Financial Group Third Quarter Report 2026 15
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Q3 2026 vs. Q3 2025 Total provision for credit losses was $722 million, compared with a provision of $797 million in the prior year. Total provision for credit losses as a percentage of average net loans and acceptances was 41 basis points, compared with 47 basis points in the prior year. The provision for credit losses on impaired loans was $708 million, a decrease of $65 million, largely due to lower provisions in Canadian P&C and U.S. Banking. The provision for credit losses on impaired loans as a percentage of average net loans and acceptances was 41 basis points, compared with 45 basis points in the prior year. There was a $14 million provision for credit losses on performing loans, compared with a $24 million provision in the prior year. The provision for credit losses on performing loans in the current quarter was primarily driven by changes in the macroeconomic outlook, partially offset by improvement in portfolio credit quality. Q3 2026 vs. Q2 2026 Total provision for credit losses decreased $17 million from the prior quarter. The provision for credit losses on impaired loans decreased $26 million, largely due to lower provisions in Canadian P&C. The provision for credit losses on impaired loans as a percentage of average net loans and acceptances was 41 basis points, compared with 45 basis points. There was a $14 million provision for credit losses on performing loans, compared with a $5 million provision in the prior quarter. Q3 YTD 2026 vs. Q3 YTD 2025 Total provision for credit losses was $2,207 million, compared with a provision of $2,862 million in the prior year. Total provision for credit losses as a percentage of average net loans and acceptances was 43 basis points, compared with 56 basis points in the prior year. The provision for credit losses on impaired loans was $2,181 million, a decrease of $216 million from the prior year, largely due to lower provisions in U.S. Banking and Canadian P&C. The provision for credit losses on impaired loans as a percentage of average net loans and acceptances was 43 basis points, compared with 47 basis points in the prior year. There was a $26 million provision for credit losses on performing loans in the current year, compared with a $465 million provision in the prior year. The $439 million decrease was largely driven by changes in the macroeconomic outlook and portfolio credit migration in the prior year. Impaired Loans TABLE 9 (Canadian $ in millions, except as noted) Q3-2026 Q2-2026 Q3-2025 YTD-2026 YTD-2025 GIL, beginning of period 6,939 6,863 6,739 7,091 5,843 Classified as impaired during the period 1,452 1,429 1,796 4,333 5,940 Transferred to performing during the period (329) (314) (415) (994) (1,219) Net repayments (800) (451) (655) (2,030) (2,002) Amounts written-off (480) (530) (442) (1,433) (1,409) Disposals of loans (87) (57) (89) (163) (156) Foreign exchange and other movements 108 (1) 17 (1) (46) GIL, end of period 6,803 6,939 6,951 6,803 6,951 GIL to gross loans and acceptances (%) 0.97 1.01 1.02 0.97 1.02 Total gross impaired loans and acceptances (GIL) were $6,803 million, a decrease from $6,939 million in the prior quarter, largely due to lower impaired loans in Capital Markets. GIL as a percentage of gross loans and acceptances was 0.97%, a decrease from 1.01% in the prior quarter. Loans classified as impaired during the quarter were $1,452 million, an increase from $1,429 million in the prior quarter, reflecting higher formations in business and government lending. Factors contributing to the change in GIL are outlined in the table above. Non-Interest Expense Q3 2026 vs. Q3 2025 R e p o r t e d n o n - i n t e r e s t e x p e n s e w a s $6,678 million, an increase of $1,573 million or 31% f r o m t h e p r i o r y e a r , a n d a d j u s t e d n o n - i n t e r e s t e x p e n s e w a s $5,472 million, an increase of $460 million or 9%. The increase in reported non-interest expense was driven by the charge related to the announced sale of BMO’s Transportation Finance and Vendor Finance businesses in the current quarter. Adjusted non-interest expense increased due to higher employee-related expenses, including performance- based compensation, higher computer and equipment, and advertising costs, as well as the impact of the stronger U.S. dollar. Reported efficiency ratio was 67.5%, compared with 56.8%, and adjusted efficiency ratio was 54.9%, compared with 55.8%. Reported operating leverage was negative 20.7% and adjusted operating leverage was positive 1.6%. Q3 2026 vs. Q2 2026 Reported non-interest expense increased $1,348 million or 25% from the prior quarter, and adjusted non-interest expense increased $264 million or 5%. The increase in reported non-interest expense included the item noted above. The increase in adjusted non-interest expense was primarily due to higher advertising costs, computer and equipment costs, and employee-related expenses, as well as the impact of the stronger U.S. dollar. 16 BMO Financial Group Third Quarter Report 2026
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Q3 YTD 2026 vs. Q3 YTD 2025 R e p o r t e d n o n - i n t e r e s t e x p e n s e w a s $17,761 million, an increase of $2,210 million or 14% from the prior year, and adjusted non-interest expense was $16,371 million, an increase of $1,230 million or 8%. The increase in reported non-interest expense reflected the impact of the announced divestiture noted above, partially offset by the impact of aligning accounting policies for employee vacation across legal entities in the prior year and a larger partial reversal of the FDIC special assessment in the current year. Adjusted non-interest expense increased due to higher employee-related expenses, including performance-based compensation and severance, and higher computer and equipment costs, partially offset by the impact of the weaker U.S. dollar. The reported efficiency ratio was 60.6%, compared with 57.7% in the prior year. The adjusted efficiency ratio was 55.7%, compared with 56.2% in the prior year. Non-interest expense is detailed in the unaudited interim consolidated financial statements. Refer to the Non-GAAP and Other Financial Measures section for further information on non-GAAP amounts, measures and ratios, including adjusting items in this Non-Interest Expense section. Provision for Income Taxes The reported provision for income taxes was $746 million, a decrease of $10 million from the prior year, and a decrease of $122 million from the prior quarter. The reported effective tax rate was 29.9%, compared with 24.5% in the prior year and 24.8% in the prior quarter. The adjusted provision for income taxes was $906 million, an increase of $126 million from the prior year, and an increase of $12 million from the prior quarter. The adjusted effective tax rate was 24.0%, compared with 24.5% in the prior year and 24.6% in the prior quarter. The change in the reported effective tax rate relative to the prior year and the prior quarter was primarily due to the impact of a charge related to the reduction in goodwill associated with the announced sale of BMO’s Transportation Finance and Vendor Finance businesses in the current quarter. The change in the adjusted effective tax rate relative to the prior year and the prior quarter was primarily due to earnings mix. Refer to the Non-GAAP and Other Financial Measures section for further information on non-GAAP amounts, measures and ratios, including adjusting items in this Provision for Income Taxes section. Balance Sheet TABLE 10 (Canadian $ in millions) As at July 31, 2026 As at October 31, 2025 Assets Cash and cash equivalents and interest bearing deposits with banks 77,286 70,322 Securities 458,626 423,476 Securities borrowed or purchased under resale agreements 109,018 129,421 Net loans and acceptances 697,927 677,872 Derivative instruments 67,997 57,151 Other assets 127,831 118,560 Total assets 1,538,685 1,476,802 Liabilities and Equity Deposits 1,017,834 976,202 Derivative instruments 69,597 58,729 Securities lent or sold under repurchase agreements 124,983 134,967 Other liabilities 232,203 210,304 Subordinated debt 7,495 8,500 Equity 86,523 88,051 Non-controlling interest in subsidiaries 50 49 Total liabilities and equity 1,538,685 1,476,802 Total assets were $1,538.7 billion as at July 31, 2026, an increase of $61.9 billion from October 31, 2025. Cash and cash equivalents and interest bearing deposits with banks increased $7.0 billion, due to higher balances held with central banks. Securities increased $35.2 billion, due to higher balances in Corporate Services and higher levels of client activity in Capital Markets. Securities borrowed or purchased under resale agreements decreased $20.4 billion, primarily due to lower levels of client activity in Capital Markets. Net loans and acceptances increased $20.1 billion. Business and government loans and acceptances increased $18.4 billion, reflecting growth across all operating segments. Consumer instalment and other personal increased $1.5 billion, with higher balances in our personal operating segments and Wealth Management partially offset by lower balances in Corporate Services. Residential mortgages increased $0.9 billion, with higher balances in Canadian P&C partially offset by lower balances in U.S. Banking. Credit card balances decreased $0.6 billion. Derivative assets increased $10.8 billion, driven by an increase in the fair value of equity, interest rate and commodity contracts, partially offset by a decrease in the fair value of foreign exchange contracts. Other assets increased $9.3 billion, primarily in Capital Markets, due to changes in the balance of unsettled securities transactions and higher cash collateral balances posted with counterparties, as well as higher balances in Wealth Management and Corporate Services, partially offset by lower balances in U.S. Banking. Total liabilities were $1,452.1 billion, an increase of $63.4 billion from October 31, 2025. BMO Financial Group Third Quarter Report 2026 17
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Deposits increased $41.6 billion. Customer deposits decreased $4.1 billion, primarily due to moderately lower balances in Canadian P&C and U.S. Banking, driven by lower term deposits, partially offset by higher operating deposits, and higher balances in Wealth Management. Other deposits increased $45.7 billion, due to higher balances in Global Markets and Corporate Services. Derivative liabilities increased $10.9 billion, driven by an increase in the fair value of equity, interest rate and commodity contracts, partially offset by a decrease in the fair value of foreign exchange contracts. Securities lent or sold under repurchase agreements decreased $10.0 billion, due to lower levels of client activity in Capital Markets. Other liabilities increased $21.9 billion, primarily in Capital Markets, due to higher securitization liabilities, changes in the balance of unsettled securities transactions and higher balances in Corporate Services and Wealth Management. Subordinated debt decreased $1.0 billion due to a redemption during the current quarter. Equity decreased $1.5 billion from October 31, 2025. Accumulated other comprehensive income decreased $0.8 billion, primarily due to losses on cash flow hedges. Preferred shares and other equity instruments decreased $1.3 billion, due to the redemption of our Limited Recourse Capital Notes, Series 1 (NVCC). Retained earnings increased $0.4 billion, as a result of net income earned in the year, largely offset by dividends and distributions on other equity instruments and the purchase of common shares for cancellation under the normal course issuer bid (NCIB). Common shares increased $0.1 billion. Capital Management BMO continues to manage its capital within the framework described in the Enterprise-Wide Capital Management section of BMO’s 2025 Annual Report. Third Quarter 2026 Regulatory Capital Review BMO’s Common Equity Tier 1 (CET1) Ratio was 13.0% as at July 31, 2026, unchanged from 13.0% at the end of the second quarter of 2026, w i t h i n t e r n a l c a p i t a l g e n e r a t i o n o f f s e t b y t h e i m p a c t o f t h e p u r c h a s e o f c o m m o n s h a r e s f o r c a n c e l l a t i o n a n d h i g h e r s o u r c e c u r r e n c y r i s k - w e i g h t e d assets (RWA). CET1 Capital was $59.3 billion as at July 31, 2026, an increase from $57.8 billion as at April 30, 2026, with internal capital generation and the impact of foreign exchange movements, partially offset by the impact of common shares purchased for cancellation. RWA were $454.8 billion as at July 31, 2026, an increase from $443.7 billion as at April 30, 2026. RWA increased due to the impact of foreign exchange movements, and higher market, credit and operational risk RWA. The increase in credit risk RWA was driven by an increase in asset size, partially offset by changes in asset quality. In calculating regulatory capital ratios, total RWA must be increased when a capital floor amount calculated under the standardized approaches, multiplied by a capital floor adjustment factor, is higher than a similar calculation using more risk-sensitive internal modelled approaches, where applicable. The capital floor was not operative as at July 31, 2026, unchanged from April 30, 2026. The bank’s Tier 1 and Total Capital Ratios were 14.7% and 16.6%, respectively, as at July 31, 2026, compared with 14.7% and 16.9%, respectively, as at April 30, 2026. The Tier 1 and Total Capital Ratios were impacted by the same factors impacting the CET1 Capital Ratio. The Total Capital Ratio was also impacted by the redemption of $1,000 million of subordinated notes. BMO’s investments in foreign operations are primarily denominated in U.S. dollars, and the foreign exchange impact of U.S. dollar-denominated RWA and capital deductions may result in variability in the bank’s capital ratios. We manage the impact of foreign exchange movements on RWA and capital deductions on our capital ratios, and during the current quarter, this impact was largely offset. Our Leverage Ratio was 4.2% as at July 31, 2026, a decrease from 4.3% at the end of the second quarter of 2026, with higher Tier 1 Capital more than offset by higher leverage exposures. The bank’s risk-based Total Loss Absorbing Capacity (TLAC) Ratio and TLAC Leverage Ratio were 29.2% and 8.4%, respectively, as at July 31, 2026, compared with 29.0% and 8.4%, respectively, as at April 30, 2026. Regulatory Capital Developments OSFI’s revised Capital Adequacy Requirements (CAR) Guideline and the Capital and Liquidity Treatment of Crypto-Asset Exposures (Banking) Guideline were effective the first quarter of fiscal 2026. These changes did not have a material impact. On June 19, 2026, OSFI announced the reduction in the Domestic Stability Buffer (DSB) level from 3.5% to 3.0%, effective immediately. In addition, OSFI lowered the DSB range from 0% to 4%, to 0% to 3%. For a discussion on other regulatory developments, refer to the Enterprise-Wide Capital Management section of BMO’s 2025 Annual Report. 18 BMO Financial Group Third Quarter Report 2026
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Regulatory Capital, Leverage and Total Loss Absorbing Capacity Regulatory capital requirements for BMO are determined in accordance with guidelines issued by OSFI, which are based on the Basel III framework developed by the Basel Committee on Banking Supervision (BCBS), and include OSFI’s CAR Guideline and the Leverage Requirements (LR) Guideline. TLAC requirements are determined in accordance with OSFI’s TLAC Guideline. For more information, refer to the Enterprise-Wide Capital Management section of BMO’s 2025 Annual Report. OSFI’s capital, leverage and TLAC requirements are summarized in the following table. TABLE 11 (% of risk-weighted assets or leverage exposures) Minimum requirements Total Pillar 1 Capital buffer (1) Tier 1 Capital buffer (2) Minimum requirements before domestic stability buffer Domestic stability buffer (3) Minimum capital, leverage and TLAC requirements including capital buffers BMO capital, leverage and TLAC ratios as at July 31, 2026 Common Equity Tier 1 Ratio 4.5% 3.5% na 8.0% 3.0% 11.0% 13.0% Tier 1 Capital Ratio 6.0% 3.5% na 9.5% 3.0% 12.5% 14.7% Total Capital Ratio 8.0% 3.5% na 11.5% 3.0% 14.5% 16.6% TLAC Ratio 21.5% na na 21.5% 3.0% 24.5% 29.2% Leverage Ratio 3.0% na 0.5% 3.5% na 3.5% 4.2% TLAC Leverage Ratio 6.75% na 0.5% 7.25% na 7.25% 8.4% (1) The minimum CET1 Ratio requirement of 4.5% is augmented by the 3.5% Total Pillar 1 Capital buffers, which can absorb losses during periods of stress. Pillar 1 Capital buffers, which will be met with CET1 Capital, include a capital conservation buffer of 2.5%, a Common Equity Tier 1 surcharge for domestic systemically important banks (D-SIBs) of 1.0% and a countercyclical buffer, as prescribed by OSFI (immaterial for the quarter). If a bank’s capital ratios fall within the range of this combined buffer, restrictions on discretionary distributions of earnings (such as dividends, share repurchases and discretionary compensation) would ensue, with the degree of such restrictions varying according to the position of the bank’s ratios within the buffer range. (2) D-SIBs are required to meet a 0.5% Tier 1 Capital buffer requirement for the Leverage and TLAC Leverage Ratios. (3) OSFI requires all D-SIBs to hold a DSB against Pillar 2 risks associated with systemic vulnerabilities. Breaches of the DSB do not result in a bank being subject to automatic constraints on capital distributions. In the event of a breach, OSFI would require a remediation plan, and would expect for the plan to be executed in a timely manner. Banks may be required to hold additional buffers that are applicable to capital, leverage and TLAC ratios. na – not applicable Regulatory Capital and TLAC Position TABLE 12 (Canadian $ in millions, except as noted) Q3-2026 Q2-2026 Q3-2025 Gross common equity (1) 78,817 77,864 77,567 Regulatory adjustments applied to common equity (19,544) (20,026) (19,643) Common Equity Tier 1 Capital (CET1) 59,273 57,838 57,924 Additional Tier 1 Eligible Capital (2) 7,706 7,706 8,956 Regulatory adjustments applied to Tier 1 Capital (115) (134) (160) Additional Tier 1 Capital (AT1) 7,591 7,572 8,796 Tier 1 Capital (T1 = CET1 + AT1) 66,864 65,410 66,720 Tier 2 Eligible Capital (3) 8,603 9,435 9,744 Regulatory adjustments applied to Tier 2 Capital – (1) (11) Tier 2 Capital (T2) 8,603 9,434 9,733 Total Capital (TC = T1 + T2) 75,467 74,844 76,453 Other TLAC instruments (4) 57,297 53,934 50,427 Adjustments applied to Other TLAC (144) (139) (71) Other TLAC available after adjustments 57,153 53,795 50,356 TLAC 132,620 128,639 126,809 Risk-Weighted Assets (5) 454,757 443,711 430,134 Leverage Ratio Exposures 1,586,178 1,528,717 1,489,621 Capital, Leverage and TLAC Ratios (%) CET1 Ratio 13.0 13.0 13.5 Tier 1 Capital Ratio 14.7 14.7 15.5 Total Capital Ratio 16.6 16.9 17.8 TLAC Ratio 29.2 29.0 29.5 Leverage Ratio 4.2 4.3 4.5 TLAC Leverage Ratio 8.4 8.4 8.5 (1) Gross Common Equity includes issued qualifying common shares, retained earnings, accumulated other comprehensive income and eligible common share capital issued by subsidiaries. (2) Additional Tier 1 Eligible Capital includes directly and indirectly issued qualifying Additional Tier 1 instruments. (3) Tier 2 Eligible Capital includes subordinated debentures and may include portion of expected credit loss provisions. (4) Other TLAC includes senior unsecured debt subject to the Canadian Bail-In Regime. (5) Institutions using one of the internal model-based approaches for credit risk, counterparty credit risk, or market risk are subject to a capital floor requirement that is applied to RWA, as prescribed in OSFI’s CAR Guideline. BMO Financial Group Third Quarter Report 2026 19
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Outstanding Shares and Securities Convertible into Common Shares (1) TABLE 13 Number of Amount As at July 31, 2026 shares (in millions) Common shares 697,146,398 $23,473 Class B Preferred shares (2) Series 44 16,000,000 $400 Series 50 500,000 $500 Series 52 650,000 $650 Other Equity Instruments (2) 4.800% Additional Tier 1 Capital Notes (3) US$500 5.625% Limited Recourse Capital Notes, Series 2 (LRCNs) $750 7.325% Limited Recourse Capital Notes, Series 3 (LRCNs) $1,000 7.700% Limited Recourse Capital Notes, Series 4 (LRCNs) US$1,000 7.300% Limited Recourse Capital Notes, Series 5 (LRCNs) US$750 6.875% Limited Recourse Capital Notes, Series 6 (LRCNs) US$1,000 Medium-Term Notes 3.803% Subordinated Notes due 2032 US$1,250 3.088% Subordinated Notes due 2037 US$1,250 Series L - First Tranche $750 Series M - First Tranche $1,150 Series M - Second Tranche $1,000 Series N - First Tranche $1,250 Stock options Vested 2,020,746 Non-vested 3,148,295 (1) Details on the Medium-Term Notes are outlined in Note 15 of the audited consolidated financial statements of BMO’s 2025 Annual Report. Details on share capital and other equity instruments are outlined in Note 6 of the unaudited interim consolidated financial statements and Note 16 of the audited annual consolidated financial statements of BMO’s 2025 Annual Report. (2) Convertible into common shares. For LRCNs, convertible into common shares by virtue of the recourse to the Preferred Shares Preferred Shares Series 49, Preferred Shares Series 51, Preferred Shares 53, Preferred Shares 54, and Preferred Shares 55 for Series 2, Series 3, Series 4, Series 5, and Series 6 LRCNs, respectively, issued concurrently with the LRCNs, which currently comprise the limited recourse trust assets. (3) The notes had an initial interest rate of 4.800% and reset on August 25, 2024 to 6.709%. If a NVCC trigger event were to occur, our NVCC instruments would be converted into BMO common shares pursuant to automatic conversion formulas, with a conversion price based on the greater of: (i) a floor price of $5.00; and (ii) the current market price of our common shares at the time of the trigger event (calculated using a 10-day weighted average). Based on a floor price of $5.00, these NVCC capital instruments would be converted into approximately 3.9 billion BMO common shares, assuming no accrued interest and no declared and unpaid dividends. Other Capital Developments On July 22, 2026, we redeemed all of our outstanding $1,000 million 1.928% Series K Medium-Term Notes First Tranche (NVCC) at par, plus accrued and unpaid interest to, but excluding, the redemption date. On November 12, 2025, we redeemed the $1,250 million 4.300% LRCNs, Series 1 (NVCC) and the corresponding $1,250 million Non-Cumulative 5- Year Fixed Rate Reset Class B Preferred Shares, Series 48 (NVCC). As part of the acquisition of Burgundy on November 1, 2025, we issued 2,723,726 common shares with an aggregate value of $481 million to shareholders of Burgundy. BMO has a normal course issuer bid (NCIB) to purchase up to 30 million of our common shares for cancellation which commenced on September 5, 2025 and ends no later than September 4, 2026. During the three months ended July 31, 2026, we purchased for cancellation 3.8 million common shares under the NCIB, at an average price of $239.37 per share for a total amount of $922 million, including tax. During the nine months ended July 31, 2026, we purchased for cancellation 15.8 million common shares under the NCIB, at an average price of $198.60 per share for a total amount of $3,193 million, including tax. The bank has purchased a total of 21.6 million common shares for cancellation under the existing NCIB as at July 31, 2026. On August 25, 2026, we announced our intention to establish a new NCIB to purchase up to 25 million of our common shares for cancellation, subject to the approval of OSFI and the Toronto Stock Exchange. The timing and amount of purchases under the NCIB are determined by management, based on factors such as market conditions and capital levels. Dividends On August 25, 2026, BMO announced that the Board of Directors had declared a quarterly dividend on common shares of $1.71 per share, unchanged from the prior quarter and an $0.08 increase from the prior year. The dividend is payable on November 26, 2026 to shareholders of record on October 30, 2026. Common shareholders may elect to have their cash dividends reinvested in common shares of BMO, in accordance with the Shareholder Dividend Reinvestment and Share Purchase Plan (DRIP). Common shares under the DRIP are purchased on the open market without a discount. For the purposes of the Income Tax Act (Canada) and any similar provincial and territorial legislation, BMO designates all dividends paid or deemed to be paid on both its common and preferred shares as “eligible dividends”, unless indicated otherwise. Caution This Capital Management section contains forward-looking statements. Please refer to the Caution Regarding Forward-Looking Statements. 20 BMO Financial Group Third Quarter Report 2026
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Operating Segments Performance Review How BMO Reports Operating Segments Results BMO reports financial results for its four operating segments, Canadian Personal and Commercial Banking, U.S. Banking, Wealth Management and Capital Markets, all of which are supported by Corporate Units and Technology and Operations (T&O) within Corporate Services. Operating segments results include allocations from Corporate Services for treasury-related revenue, corporate and T&O expenses, taxes and capital. BMO employs funds transfer pricing and liquidity transfer pricing between corporate treasury and the operating segments in order to assign cost or credit on assets and liabilities to facilitate effective pricing and business decision-making, and to help assess the profitability performance of each line of business. These practices also capture the cost of holding supplemental liquid assets to meet contingent liquidity requirements, as well as facilitating the management of interest rate and liquidity risk within our risk appetite framework and regulatory requirements. We review our transfer pricing methodologies at least annually in order to align with our interest rate, liquidity and funding risk management practices, and update these as appropriate. The costs of Corporate Units and T&O services are largely allocated to the four operating segments, with any remaining amounts retained in Corporate Services. Certain expenses directly incurred to support a specific operating segment are generally allocated to that operating segment. Other expenses are generally allocated across the operating segments in amounts that are reasonably reflective of the level of support provided to each operating segment. We review our allocation methodologies at least annually and update these as appropriate. Capital is allocated to the operating segments based on the amount of regulatory capital required to support business activities, including risk-weighted assets and capital deductions. Effective the first quarter of fiscal 2026, the allocation approach was updated, primarily to reflect an increase in the capital allocation rate to 12.5% of risk-weighted assets, compared with 12.0% in fiscal 2025. Unallocated capital is reported in Corporate Services. We review our capital allocation methodologies at least annually and update these as appropriate. Periodically, certain lines of business and units within our organizational structure are realigned to support our strategic priorities. In addition, revenue and expense allocations, including between operating segments, are updated to more accurately align with these priorities. Results for prior periods are reclassified to conform with the current period’s presentation. We analyze revenue at the consolidated level based on GAAP revenue as reported in the audited annual consolidated financial statements, rather than on a taxable equivalent basis (teb). Similar to many banks, BMO analyzes revenue on a teb basis at the operating segment level. Net interest income, total revenue and provision for (recovery of) income taxes in Capital Markets and U.S. Banking are increased on tax-exempt securities to equivalent pre-tax amounts in order to facilitate comparisons of income from taxable and tax-exempt sources, and are reflected in the key performance metrics. The offset to the segment teb adjustments is reflected in Corporate Services net interest income, total revenue and provision for (recovery of) income taxes. Caution This How BMO Reports Operating Segments Results section contains forward-looking statements. Please refer to the Caution Regarding Forward-Looking Statements. Canadian Personal and Commercial Banking (Canadian P&C) (1) TABLE 14 (Canadian $ in millions, except as noted) Q3-2026 Q2-2026 Q3-2025 YTD-2026 YTD-2025 Net interest income 2,558 2,425 2,459 7,506 7,203 Non-interest revenue 699 672 617 2,106 1,869 Total revenue 3,257 3,097 3,076 9,612 9,072 Provision for credit losses on impaired loans 447 477 489 1,421 1,456 Provision for credit losses on performing loans 60 42 76 120 259 Total provision for credit losses (PCL) 507 519 565 1,541 1,715 Non-interest expense 1,399 1,358 1,341 4,194 3,925 Income before income taxes 1,351 1,220 1,170 3,877 3,432 Provision for income taxes 371 336 321 1,065 942 Reported net income 980 884 849 2,812 2,490 Dividends on preferred shares and distributions on other equity instruments 12 11 12 36 35 Net income available to common shareholders 968 873 837 2,776 2,455 Amortization of acquisition-related intangible assets (2) 3 3 3 9 10 Adjusted net income 983 887 852 2,821 2,500 Adjusted net income available to common shareholders 971 876 840 2,785 2,465 Adjusted non-interest expense 1,395 1,353 1,337 4,181 3,912 Key Performance Metrics Personal and Business Banking revenue 2,319 2,227 2,209 6,852 6,503 Commercial Banking revenue 938 870 867 2,760 2,569 Return on equity (%) (3) (4) 22.8 21.4 19.8 22.3 19.7 Adjusted return on equity (%) (3) (4) 22.9 21.5 19.9 22.4 19.8 Operating leverage (%) 1.6 (0.3) 0.2 (0.9) 1.1 Adjusted operating leverage (%) 1.6 (0.3) (0.1) (0.9) 0.9 Efficiency ratio (%) 42.9 43.9 43.6 43.6 43.3 Adjusted efficiency ratio (%) 42.8 43.7 43.5 43.5 43.1 PCL on impaired loans-to-average net loans and acceptances (%) (4) 0.52 0.57 0.57 0.56 0.58 Net interest margin on average earning assets (%) 2.90 2.88 2.84 2.89 2.82 Average earning assets 349,292 345,907 343,805 346,697 341,670 Average gross loans and acceptances 347,529 344,106 342,077 344,918 339,952 Average deposits 306,610 305,237 310,564 307,785 311,732 (1) Adjusted results and ratios are on a non-GAAP basis and are discussed in the Non-GAAP and Other Financial Measures section. BMO Financial Group Third Quarter Report 2026 21
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(2) A m o r t i z a t i o n o f a c q u i s i t i o n - r e l a t e d i n t a n g i b l e a s s e t s a n d a n y i m p a i r m e n t s , r e c o r d e d i n n o n - i n t e r e s t e x p e n s e . (3) Return on equity is based on allocated capital. For further information, refer to the How BMO Reports Operating Segments Results section. (4) Return on equity and PCL ratios are presented on an annualized basis. Certain comparative figures have been reclassified to conform with the current period’s presentation. Q3 2026 vs. Q3 2025 Canadian P&C reported net income was $980 million, an increase of $131 million or 16% from the prior year. Total revenue was $3,257 million, an increase of $181 million or 6% from the prior year. Net interest income increased $99 million or 4%, primarily due to higher net interest margin. Non-interest revenue increased $82 million or 13%, primarily due to higher mutual fund distribution fees, card-related revenue and Treasury and Payment Solutions (TPS) fees, partially offset by lower retail deposit fee revenue. Net interest margin of 2.90% increased 6 basis points from the prior year, primarily due to higher deposit margins, partially offset by a change in product mix and lower loan margins. Personal and Business Banking revenue increased $110 million or 5% and Commercial Banking revenue increased $71 million or 8%, both due to higher net interest income and non-interest revenue. Total provision for credit losses was $507 million, a decrease of $58 million from the prior year. The provision for credit losses on impaired loans was $447 million, a decrease of $42 million, primarily due to lower provisions in Commercial Banking. There was a $60 million provision for credit losses on performing loans in the current quarter, compared with a $76 million provision in the prior year. Non-interest expense was $1,399 million, an increase of $58 million or 4% from the prior year, reflecting higher operating costs and technology investments. Average gross loans and acceptances increased $5.5 billion or 2% from the prior year to $347.5 billion. Personal and Business Banking loan balances increased 2%, primarily reflecting growth in residential mortgages, Commercial Banking loan balances increased 3% and credit card balances decreased 8%. Average deposits decreased $4.0 billion or 1% from the prior year to $306.6 billion, with lower term deposits partially offset by higher operating deposits. Personal and Business Banking deposits decreased 5% and Commercial Banking deposits increased 7%. Q3 2026 vs. Q2 2026 Reported net income increased $96 million or 11% from the prior quarter. Total revenue increased $160 million or 5% from the prior quarter. Net interest income increased $133 million or 5%, primarily due to the impact of three additional days in the current quarter and balance growth. Non-interest revenue increased $27 million or 4%, primarily due to higher mutual fund distribution fees. Net interest margin of 2.90% increased 2 basis points from the prior quarter, with higher deposit margins partially offset by lower loan margins. Personal and Business Banking revenue increased $92 million or 4% and Commercial Banking revenue increased $68 million or 8%, both due to higher net interest income and non-interest revenue. Total provision for credit losses decreased $12 million from the prior quarter. The provision for credit losses on impaired loans decreased $30 million, largely due to lower provisions in unsecured consumer lending. There was a $60 million provision for credit losses on performing loans in the current quarter, compared with a $42 million provision in the prior quarter. Non-interest expense increased $41 million or 3% from the prior quarter, primarily due to higher operating costs and higher employee-related expenses. Average gross loans and acceptances increased $3.4 billion or 1% from the prior quarter, with increases in Personal and Business Banking, Commercial Banking and credit card balances. Average deposits increased $1.4 billion from the prior quarter reflecting higher operating deposits, partially offset by lower term deposits. Personal and Business Banking deposits decreased 1% and Commercial Banking deposits increased 3%. Q3 YTD 2026 vs. Q3 YTD 2025 Canadian P&C reported net income was $2,812 million, an increase of $322 million or 13% from the prior year. Total revenue increased $540 million or 6% from the prior year. Net interest income increased $303 million or 4%, primarily due to higher net interest margin and balance growth. Non-interest revenue increased $237 million or 13% from the prior year, primarily due to above-trend card-related revenue reflecting revised future redemption assumptions and lower payment processing costs in the current year, higher mutual fund distribution fees and higher gains on investments in our Commercial Banking business, partially offset by lower retail deposit fee revenue. Net interest margin of 2.89% increased 7 basis points from the prior year, primarily due to higher deposit and loan margins, partially offset by a change in product mix. Personal and Business Banking revenue increased $349 million or 5% and Commercial Banking revenue increased $191 million or 7%, both due to higher net interest income and non-interest revenue. Total provision for credit losses was $1,541 million, a decrease of $174 million from the prior year. The provision for credit losses on impaired loans was $1,421 million, a decrease of $35 million due to lower provisions in Commercial Banking, partially offset by higher provisions in Personal and Business Banking. There was a $120 million provision for credit losses on performing loans in the current year, compared with a $259 million provision in the prior year. Non-interest expense increased $269 million or 7% from the prior year, primarily due to higher employee-related expenses, including severance, higher operating costs and technology investments. Average gross loans and acceptances increased $5.0 billion from the prior year. Personal and Business Banking and Commercial Banking loan balances both increased 2%, and credit card balances decreased 8%. Average deposits decreased $3.9 billion from the prior year. Personal and Business Banking deposits decreased 4% and Commercial Banking deposits increased 5%. 22 BMO Financial Group Third Quarter Report 2026
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Refer to the Non-GAAP and Other Financial Measures section for further information on non-GAAP amounts, measures and ratios, including adjusting items in this Operating Segments Performance Review section. U.S. Banking (1) TABLE 15 (Canadian $ in millions, except as noted) Q3-2026 Q2-2026 Q3-2025 YTD-2026 YTD-2025 Net interest income (teb) (2) 2,390 2,217 2,221 6,874 6,783 Non-interest revenue 644 642 609 1,915 1,825 Total revenue (teb) (2) 3,034 2,859 2,830 8,789 8,608 Provision for credit losses on impaired loans 223 237 241 662 801 Provision (recovery of provision) for credit losses on performing loans (50) (53) (70) (86) 123 Total provision for credit losses (PCL) 173 184 171 576 924 Non-interest expense 1,750 1,667 1,670 5,151 5,136 Income before income taxes 1,111 1,008 989 3,062 2,548 Provision for income taxes (teb) (2) 243 218 222 662 545 Reported net income 868 790 767 2,400 2,003 Dividends on preferred shares and distributions on other equity instruments 15 14 15 43 46 Net income attributable to non-controlling interest in subsidiaries 1 4 2 3 7 Net income available to common shareholders 852 772 750 2,354 1,950 Amortization of acquisition-related intangible assets (3) 57 57 62 174 208 Adjusted net income 925 847 829 2,574 2,211 Adjusted net income available to common shareholders 909 829 812 2,528 2,158 Adjusted non-interest expense 1,673 1,592 1,586 4,918 4,856 Average earning assets 235,937 225,426 230,849 228,772 238,149 Average gross loans and acceptances 226,890 216,305 220,558 219,594 227,163 Average deposits 234,387 230,674 237,189 233,453 247,596 (US$ equivalent in millions) Net interest income (teb) (2) 1,707 1,615 1,617 4,970 4,818 Non-interest revenue 460 469 442 1,386 1,296 Total revenue (teb) (2) 2,167 2,084 2,059 6,356 6,114 Provision for credit losses on impaired loans 159 173 175 480 568 Provision (recovery of provision) for credit losses on performing loans (36) (38) (50) (62) 86 Total provision for credit losses 123 135 125 418 654 Non-interest expense 1,250 1,215 1,217 3,725 3,648 Income before income taxes 794 734 717 2,213 1,812 Provision for income taxes (teb) (2) 174 159 159 479 387 Reported net income 620 575 558 1,734 1,425 Dividends on preferred shares and distributions on other equity instruments 11 10 11 31 33 Net income attributable to non-controlling interest in subsidiaries 1 2 2 2 5 Net income available to common shareholders 608 563 545 1,701 1,387 Amortization of acquisition-related intangible assets (3) 41 41 45 126 147 Adjusted net income 661 616 603 1,860 1,572 Adjusted net income available to common shareholders 649 604 590 1,827 1,534 Adjusted non-interest expense 1,195 1,160 1,156 3,556 3,449 Key Performance Metrics (US$ basis) Personal and Business Banking revenue 782 750 743 2,286 2,144 Commercial Banking revenue 1,155 1,113 1,107 3,402 3,358 Private Wealth revenue 230 221 209 668 612 Return on equity (%) (4) (5) 9.2 8.6 8.2 8.6 7.0 Adjusted return on equity (%) (4) (5) 9.8 9.3 8.9 9.2 7.8 Operating leverage (%) 2.3 4.3 4.6 1.8 3.4 Adjusted operating leverage (%) 1.7 3.0 3.8 0.8 2.9 Efficiency ratio (%) 57.7 58.3 59.0 58.6 59.6 Adjusted efficiency ratio (%) 55.2 55.7 56.1 56.0 56.4 Net interest margin on average earning assets (%) 4.02 4.03 3.82 4.02 3.81 PCL on impaired loans-to-average net loans and acceptances (%) (5) 0.39 0.46 0.44 0.41 0.47 Average earning assets 168,477 164,298 168,134 165,409 169,158 Average gross loans and acceptances 162,016 157,651 160,639 158,771 161,357 Average deposits 167,370 168,117 172,753 168,819 175,837 Assets under administration (6) 126,331 126,023 103,846 126,331 103,846 Assets under management (6) 88,754 88,514 75,884 88,754 75,884 (1) Adjusted results and ratios are on a non-GAAP basis and are discussed in the Non-GAAP and Other Financial Measures section. (2) Net interest income, total revenue and the provision for income taxes are presented on a taxable equivalent basis (teb) and are reflected in the ratios. Teb amounts of $5 million in both Q3-2026 and Q2-2026, and $8 million in Q3-2025; and $17 million for YTD-2026 and $25 million for YTD-2025, are offset in Corporate Services. On a source currency basis: US$4 million in both Q3-2026 and Q2-2026, and US$6 million in Q3-2025; and US$13 million for YTD-2026 and US$18 million for YTD-2025. (3) A m o r t i z a t i o n o f a c q u i s i t i o n - r e l a t e d i n t a n g i b l e a s s e t s a n d a n y i m p a i r m e n t s , r e c o r d e d i n n o n - i n t e r e s t e x p e n s e . O n a s o u r c e c u r r e n c y b a s i s : U S $ 5 5 m i l l i o n i n b o t h Q 3 - 2 0 2 6 a n d Q 2 - 2 0 2 6 , a n d U S $ 6 1 m i l l i o n i n Q3-2025; and US$169 million for YTD-2026 and US$199 million for YTD-2025. (4) Return on equity is based on allocated capital. For further information, refer to the How BMO Reports Operating Segments Results section. (5) Return on equity and PCL ratios are presented on an annualized basis. (6) Relates to Private Wealth. Assets under administration excludes assets under custody. Certain comparative figures have been reclassified to conform with the current period’s presentation. BMO Financial Group Third Quarter Report 2026 23
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Q3 2026 vs. Q3 2025 U.S. Banking reported net income was $868 million, an increase of $101 million or 13% from the prior year. The impact of the stronger U.S. dollar increased each of revenue, expenses and net income by 2%. All amounts in the remainder of this section are presented on a U.S. dollar basis. Reported net income was $620 million, an increase of $62 million or 11% from the prior year. Total revenue was $2,167 million, an increase of $108 million or 5% from the prior year. Net interest income increased $90 million or 6%, primarily due to higher net interest margin. Non-interest revenue increased $18 million or 4% from the prior year, primarily due to higher investment management and deposit fee revenue. Net interest margin of 4.02% increased 20 basis points, primarily due to higher deposit margins, including an improved deposit mix, and higher loan margins, partially offset by loans growing faster than deposits. Commercial Banking revenue increased $48 million or 4% and Personal and Business Banking revenue increased $39 million or 5%, both primarily due to higher net interest income. Private Wealth revenue increased $21 million or 10%. Total provision for credit losses was $123 million, relatively unchanged from the prior year. The provision for credit losses on impaired loans was $159 million, a decrease of $16 million, largely due to lower provisions in both Personal and Business Banking and Commercial Banking. There was a $36 million recovery of the provision for credit losses on performing loans in the current quarter, compared with a $50 million recovery in the prior year. Non-interest expense was $1,250 million, an increase of $33 million or 3% from the prior year, primarily due to investments in technology and talent. Average gross loans and acceptances increased $1.4 billion or 1% from the prior year to $162.0 billion. Commercial Banking loan balances increased 1%, Personal and Business Banking balances decreased 2% and Private Wealth balances increased 8%. Average total deposits decreased $5.4 billion or 3% from the prior year to $167.4 billion, with lower term deposits partially offset by higher operating deposits, reflecting deposit optimization. Personal and Business Banking deposits decreased 7%, Commercial Banking deposits increased 2% and Private Wealth deposits decreased 9%. Assets under management of $88.8 billion increased $12.9 billion or 17% from the prior year, and assets under administration increased $22.5 billion or 22% to $126.3 billion, both primarily driven by stronger markets. Q3 2026 vs. Q2 2026 Reported net income increased $78 million or 10% from the prior quarter. The impact of the stronger U.S. dollar increased each of revenue, expenses and net income by 2%. All amounts in the remainder of this section are presented on a U.S. dollar basis. Reported net income increased $45 million or 8% from the prior quarter. Total revenue increased $83 million or 4%. Net interest income increased $92 million or 6%, primarily due to the impact of three additional days in the current quarter and higher loan balances. Non-interest revenue decreased $9 million or 2% from the prior quarter, primarily due to lower advisory fee revenue, partially offset by higher lending fee revenue. Net interest margin decreased 1 basis point, primarily due to balance sheet mix, including loans growing faster than deposits, partially offset by higher loan margins. Commercial Banking revenue increased $42 million or 4%, due to higher net interest income, partially offset by lower non-interest revenue. Personal and Business Banking revenue increased $32 million or 4%, due to higher net interest income. Private Wealth revenue increased $9 million or 4%. Total provision for credit losses decreased $12 million from the prior quarter. The provision for credit losses on impaired loans decreased $14 million, largely due to lower provisions in Commercial Banking. There was a $36 million recovery of provisions for credit losses on performing loans in the current quarter, compared with a $38 million recovery in the prior quarter. Non-interest expense increased $35 million or 3% from the prior quarter, primarily due to higher operating costs and employee-related expenses. Average gross loans and acceptances increased $4.4 billion or 3% from the prior quarter. Commercial Banking loan balances increased 4% and Private Wealth balances increased 2%, with Personal and Business Banking balances relatively unchanged. Average total deposits decreased $0.7 billion from the prior quarter. Commercial Banking deposits increased 1%, Personal and Business Banking deposits decreased 2% and Private Wealth deposits decreased 5%. Assets under management increased $0.2 billion from the prior quarter, and assets under administration increased $0.3 billion. Q3 YTD 2026 vs. Q3 YTD 2025 Reported net income was $2,400 million, an increase of $397 million or 20% from the prior year. The impact of the weaker U.S. dollar decreased each of revenue, expenses and net income by 2%. All amounts in the remainder of this section are on a U.S. dollar basis. Reported net income was $1,734 million, an increase of $309 million or 22% from the prior year. Total revenue was $6,356 million, an increase of $242 million or 4% from the prior year. Net interest income increased $152 million or 3%, primarily due to higher net interest margin, partially offset by lower balances. Non-interest revenue increased $90 million or 7%, due to higher investment management and deposit fee revenue, as well as the impact of a loss on the strategic sale of a non-relationship credit card portfolio in the prior year. Net interest margin of 4.02% increased 21 basis points, primarily due to higher deposit margins. Personal and Business Banking revenue increased $142 million or 7% and Commercial Banking increased $44 million or 1%, both due to higher net interest income and non-interest revenue. Private Wealth revenue increased $56 million or 9%. Total provision for credit losses was $418 million, a decrease of $236 million from the prior year. The provision for credit losses on impaired loans was $480 million, a decrease of $88 million, largely due to lower provisions in Commercial Banking. There was a $62 million recovery of the provision for credit losses on performing loans in the current year, compared with an $86 million provision in the prior year. 24 BMO Financial Group Third Quarter Report 2026
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Non-interest expense was $3,725 million, an increase of $77 million or 2% from the prior year, primarily due to investments in technology and talent. Average gross loans and acceptances decreased $2.6 billion or 2% from the prior year to $158.8 billion. Commercial loan balances decreased 3% reflecting optimization initiatives, Private Wealth balances increased 9% and Personal and Business Banking balances decreased 1%. Average total deposits decreased $7.0 billion or 4% to $168.8 billion, due to lower term balances, partially offset by higher operating deposits. Personal and Business Banking deposits decreased 8% and Private Wealth balances decreased 7%, with Commercial Banking relatively unchanged from the prior year. Refer to the Non-GAAP and Other Financial Measures section for further information on non-GAAP amounts, measures and ratios, including adjusting items in this Operating Segments Performance Review section. Wealth Management (1) TABLE 16 (Canadian $ in millions, except as noted) Q3-2026 Q2-2026 Q3-2025 YTD-2026 YTD-2025 Net interest income 315 301 257 906 746 Non-interest revenue 1,264 1,229 1,108 3,703 3,202 Total revenue 1,579 1,530 1,365 4,609 3,948 Provision for credit losses on impaired loans 2 1 1 5 3 Provision (recovery of provision) for credit losses on performing loans (3) 6 2 (1) 3 Total provision (recovery of provision) for credit losses (PCL) (1) 7 3 4 6 Non-interest expense 1,034 968 842 3,032 2,559 Income before income taxes 546 555 520 1,573 1,383 Provision for income taxes 138 127 128 385 343 Reported net income 408 428 392 1,188 1,040 Dividends on preferred shares and distributions on other equity instruments 2 1 1 5 4 Net income available to common shareholders 406 427 391 1,183 1,036 Acquisition and integration costs (2) 4 2 3 13 3 Amortization of acquisition-related intangible assets (3) 5 7 – 17 – Change in fair value of contingent consideration (4) 63 7 – 86 – Adjusted net income 480 444 395 1,304 1,043 Adjusted net income available to common shareholders 478 443 394 1,299 1,039 Adjusted total revenue 1,642 1,537 1,365 4,695 3,948 Adjusted non-interest expense 1,020 956 838 2,991 2,555 Key Performance Metrics Wealth and Asset Management reported net income 320 342 297 935 803 Wealth and Asset Management adjusted net income 392 358 300 1,051 806 Insurance reported net income 88 86 95 253 237 Return on equity (%) (5) (6) 35.9 39.8 51.8 36.3 45.8 Adjusted return on equity (%) (5) (6) 42.4 41.3 52.2 39.8 46.0 Efficiency ratio (%) 65.4 63.3 61.6 65.8 64.8 Adjusted efficiency ratio (%) 62.1 62.2 61.4 63.7 64.7 Operating leverage (%) (7.1) 5.1 7.1 (1.8) 6.7 Adjusted operating leverage (%) (1.4) 7.2 7.6 1.9 6.9 PCL on impaired loans-to-average net loans and acceptances (%) (6) 0.01 0.02 0.02 0.02 0.02 Average assets 59,923 57,484 53,484 57,861 53,038 Average gross loans and acceptances 31,615 30,901 30,079 31,108 29,870 Average deposits 60,117 58,567 52,908 58,698 51,696 Assets under administration (7) 310,020 297,658 262,354 310,020 262,354 Assets under management 479,122 451,531 359,109 479,122 359,109 (1) Adjusted results and ratios are on a non-GAAP basis and are discussed in the Non-GAAP and Other Financial Measures section. (2) Acquisition and integration costs related to the acquisition of Burgundy, recorded in non-interest expense. (3) A m o r t i z a t i o n o f a c q u i s i t i o n - r e l a t e d i n t a n g i b l e a s s e t s a n d a n y i m p a i r m e n t s , r e c o r d e d i n n o n - i n t e r e s t e x p e n s e . (4) Change in fair value of contingent consideration related to the acquisition of Burgundy, recorded in non-interest revenue. (5) Return on equity is based on allocated capital. For further information, refer to the How BMO Reports Operating Segments Results section. (6) Return on equity and PCL ratios are presented on an annualized basis. (7) Certain assets under management that are also administered by the bank are included in assets under administration. Certain comparative figures have been reclassified to conform with the current period’s presentation. Q3 2026 vs. Q3 2025 Wealth Management reported net income was $408 million, an increase of $16 million or 4% from the prior year. Wealth and Asset Management net income was $320 million, an increase of $23 million or 8%, and Insurance net income was $88 million, a decrease of $7 million or 8%. Total revenue was $1,579 million, an increase of $214 million or 16% from the prior year. Revenue in Wealth and Asset Management was $1,455 million, an increase of $235 million or 19%, primarily due to the impact of stronger global markets and net sales, higher net interest income and the inclusion of Burgundy, partially offset by a change in fair value of contingent consideration related to the acquisition. Insurance revenue was $124 million, a decrease of $21 million or 14%, due to a gain on the sale of a non-strategic portfolio of insurance contracts in the prior year, partially offset by the impact of favourable market movements in the current year. Total recovery of the provision for credit losses was $1 million, compared with a provision of $3 million in the prior year. Non-interest expense was $1,034 million, an increase of $192 million or 23%, primarily due to higher employee-related expenses, including higher revenue-based costs, as well as the impact of Burgundy. Assets under management increased $120.0 billion or 33% from the prior year to $479.1 billion, primarily due to stronger global markets, higher clients assets and the inclusion of Burgundy. Assets under administration increased $47.7 billion or 18% to $310.0 billion, primarily driven by stronger global markets. Average gross loans increased 5% and average deposits increased 14%. BMO Financial Group Third Quarter Report 2026 25
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Q3 2026 vs. Q2 2026 Reported net income decreased $20 million or 5% from the prior quarter. Wealth and Asset Management reported net income decreased $22 million or 7%, and Insurance net income increased $2 million. Total revenue increased $49 million or 3% from the prior quarter. Revenue in Wealth and Asset Management increased $47 million or 3%, primarily due to the impact of stronger global markets and three additional days in the current quarter, partially offset by a change in fair value of contingent consideration related to the acquisition of Burgundy. Insurance revenue increased $2 million or 2%. Total recovery of the provision for credit losses was $1 million, compared with a provision of $7 million in the prior quarter. Non-interest expense increased $66 million or 7%, primarily due to higher employee-related expenses. Assets under management increased $27.6 billion or 6%, due to stronger global markets and higher client assets. Assets under administration increased $12.4 billion or 4%, due to stronger global markets. Average gross loans increased 2% and average deposits increased 3%. Q3 YTD 2026 vs. Q3 YTD 2025 Reported net income was $1,188 million, an increase of $148 million or 14% from the prior year. Wealth and Asset Management reported net income was $935 million, an increase of $132 million or 16%, and Insurance net income was $253 million, an increase of $16 million or 7% from the prior year. Total revenue was $4,609 million, an increase of $661 million or 17%. Revenue in Wealth and Asset Management was $4,235 million, an increase of $661 million or 18%, primarily due to the impact of stronger global markets and net sales, higher net interest income, as well as the inclusion of Burgundy, partially offset by a change in fair value of contingent consideration related to the acquisition. Insurance revenue was $374 million, unchanged from the prior year, with higher insurance investment results driven by favourable market movements, partially offset by lower insurance service results and the gain on the sale in the prior year noted above. Total provision for credit losses was $4 million, a decrease of $2 million from the prior year. Non-interest expense was $3,032 million, an increase of $473 million or 18%, primarily due to higher employee-related expenses, including higher revenue-based costs and severance, as well as the inclusion of Burgundy. Refer to the Non-GAAP and Other Financial Measures section for further information on non-GAAP amounts, measures and ratios, including adjusting items in this Operating Segments Performance Review section. Capital Markets (1) TABLE 17 (Canadian $ in millions, except as noted) Q3-2026 Q2-2026 Q3-2025 YTD-2026 YTD-2025 Net interest income (teb) (2) 583 510 729 1,793 1,902 Non-interest revenue 1,544 1,604 1,047 4,660 3,726 Total revenue (teb) (2) 2,127 2,114 1,776 6,453 5,628 Provision for credit losses on impaired loans 30 15 33 74 96 Provision for credit losses on performing loans 11 14 23 4 107 Total provision for credit losses (PCL) 41 29 56 78 203 Non-interest expense 1,229 1,218 1,132 3,771 3,479 Income before income taxes 857 867 588 2,604 1,946 Provision for income taxes (teb) (2) 212 229 146 664 481 Reported net income 645 638 442 1,940 1,465 Dividends on preferred shares and distributions on other equity instruments 15 15 11 45 31 Net income available to common shareholders 630 623 431 1,895 1,434 Amortization of acquisition-related intangible assets (3) 4 3 4 10 11 Adjusted net income 649 641 446 1,950 1,476 Adjusted net income available to common shareholders 634 626 435 1,905 1,445 Adjusted non-interest expense 1,224 1,214 1,127 3,757 3,464 Key Performance Metrics Global Markets revenue 1,337 1,322 1,055 4,099 3,570 Investment and Corporate Banking revenue 790 792 721 2,354 2,058 Return on equity (%) (4) (5) 16.0 16.6 12.6 16.5 14.0 Adjusted return on equity (%) (4) (5) 16.1 16.7 12.7 16.5 14.1 Operating leverage (teb) (%) 11.2 7.7 (1.7) 6.3 5.1 Adjusted operating leverage (teb) (%) 11.1 7.6 (1.9) 6.2 4.4 Efficiency ratio (teb) (%) 57.7 57.6 63.7 58.4 61.8 Adjusted efficiency ratio (teb) (%) 57.5 57.4 63.5 58.2 61.5 PCL on impaired loans-to-average net loans and acceptances (%) (5) 0.14 0.07 0.16 0.11 0.15 Average assets 614,772 596,933 514,825 601,878 552,478 Average gross loans and acceptances 89,447 86,874 82,668 87,774 83,830 U.S. Business Select Financial Data (US$ in millions) Total revenue (teb) 734 711 641 2,261 2,019 Non-interest expense 418 444 422 1,337 1,245 Reported net income 224 166 151 639 510 Adjusted non-interest expense 416 441 419 1,330 1,237 Adjusted net income 225 168 153 644 516 Average assets 216,716 215,280 181,423 212,152 194,443 Average gross loans and acceptances 36,523 35,654 32,582 35,827 31,758 (1) Adjusted results and ratios are on a non-GAAP basis and are discussed in the Non-GAAP and Other Financial Measures section. (2) Net interest income, total revenue and the provision for income taxes are presented on a taxable equivalent basis (teb) and are reflected in the ratios. Teb amounts of $2 million in each of Q3-2026, Q2-2026 and Q3-2025; and $6 million for YTD-2026 and $4 million for YTD-2025, are offset in Corporate Services. 26 BMO Financial Group Third Quarter Report 2026
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(3) A m o r t i z a t i o n o f a c q u i s i t i o n - r e l a t e d i n t a n g i b l e a s s e t s a n d a n y i m p a i r m e n t s , r e c o r d e d i n n o n - i n t e r e s t e x p e n s e . (4) Return on equity is based on allocated capital. For further information, refer to the How BMO Reports Operating Segments Results section. (5) Return on equity and PCL ratios are presented on an annualized basis. Certain comparative figures have been reclassified to conform with the current period’s presentation. Q3 2026 vs. Q3 2025 Capital Markets reported net income was $645 million, an increase of $203 million or 46% from the prior year. Total revenue was $2,127 million, an increase of $351 million or 20% from the prior year. Global Markets revenue increased $282 million or 27%, primarily due to higher equities trading revenue. Investment and Corporate Banking revenue increased $69 million or 10%, primarily due to higher corporate banking revenue and debt underwriting revenue. Total provision for credit losses was $41 million, a decrease of $15 million from the prior year. The provision for credit losses on impaired loans was $30 million, a decrease of $3 million. There was an $11 million provision for credit losses on performing loans in the current quarter, compared with a $23 million provision in the prior year. Non-interest expense was $1,229 million, an increase of $97 million or 8% from the prior year, driven by higher employee-related expenses and technology costs. Average gross loans and acceptances of $89.4 billion increased $6.8 billion or 8% from the prior year. Q3 2026 vs. Q2 2026 Reported net income increased $7 million or 1% from the prior quarter. Total revenue increased $13 million or 1% from the prior quarter. Global Markets revenue increased $15 million or 1%, primarily due to higher debt issuances. Investment and Corporate Banking revenue was relatively unchanged from the prior quarter, as higher corporate banking revenue and lower markdowns on fair value loans were offset by lower underwriting and advisory fee revenue and lower net gains on investments. Total provision for credit losses increased $12 million from the prior quarter. The provision for credit losses on impaired loans increased $15 million from the prior quarter. There was an $11 million provision for credit losses on performing loans in the current quarter, compared with a $14 million provision in the prior quarter. Non-interest expense was relatively unchanged from the prior quarter. Average gross loans and acceptances increased $2.6 billion from the prior quarter. Q3 YTD 2026 vs. Q3 YTD 2025 Capital Markets reported net income was $1,940 million, an increase of $475 million or 32% from the prior year. Total revenue was $6,453 million, an increase of $825 million or 15% from the prior year. Global Markets revenue increased $529 million or 15%, primarily due to higher equities trading revenue and higher debt and equity issuances, partially offset by lower interest rate trading revenue and the impact of the weaker U.S. dollar. Investment and Corporate Banking revenue increased $296 million or 14%, primarily due to higher advisory fee, equity underwriting and corporate banking revenue, as well as lower markdowns on fair value loans. Total provision for credit losses was $78 million, a decrease of $125 million from the prior year. The provision for credit losses on impaired loans was $74 million, a decrease of $22 million. There was a $4 million provision for credit losses on performing loans in the current year, compared with a $107 million provision in the prior year. Non-interest expense was $3,771 million, an increase of $292 million or 8% from the prior year, driven by higher performance-based compensation, and technology and operating costs. Average gross loans and acceptances of $87.8 billion increased $3.9 billion from the prior year. Refer to the Non-GAAP and Other Financial Measures section for further information on non-GAAP amounts, measures and ratios, including adjusting items in this Operating Segments Performance Review section. BMO Financial Group Third Quarter Report 2026 27
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Corporate Services (1) TABLE 18 (Canadian $ in millions, except as noted) Q3-2026 Q2-2026 Q3-2025 YTD-2026 YTD-2025 Net interest income before segment teb offset (272) (178) (160) (578) (614) Segment teb offset (7) (7) (10) (23) (29) Net interest income (teb) (279) (185) (170) (601) (643) Non-interest revenue 178 152 111 425 320 Total revenue (teb) (101) (33) (59) (176) (323) Provision for credit losses on impaired loans 6 4 9 19 41 Recovery of provision for credit losses on performing loans (4) (4) (7) (11) (27) Total provision for credit losses 2 – 2 8 14 Non-interest expense 1,266 119 120 1,613 452 Loss before income taxes (1,369) (152) (181) (1,797) (789) Recovery of income taxes (teb) (218) (42) (61) (326) (221) Reported net loss (1,151) (110) (120) (1,471) (568) Dividends on preferred shares and distributions on other equity instruments 37 98 27 172 157 Net income attributable to non-controlling interest in subsidiaries 1 – 1 2 2 Net loss available to common shareholders (1,189) (208) (148) (1,645) (727) Acquisition and integration costs (2) – – 1 – 7 Impact of divestitures 973 24 – 1,000 – FDIC special assessment – – (4) (35) (5) Impact of alignment of accounting policies – – – – 70 Adjusted net loss (178) (86) (123) (506) (496) Adjusted net loss available to common shareholders (216) (184) (151) (680) (655) Adjusted non-interest expense 160 93 124 524 354 U.S. Business Select Financial Data (US$ in millions) Total revenue (teb) (3) (62) (43) (12) (132) (15) Total provision (recovery of provision) for credit losses (2) (2) (1) (4) 1 Non-interest expense 843 76 60 1,009 174 Recovery of income taxes (teb) (3) (127) (31) (23) (202) (70) Reported net loss (776) (86) (48) (935) (120) Adjusted non-interest expense 71 56 62 249 138 Adjusted net loss (92) (68) (50) (257) (94) (1) Adjusted results are on a non-GAAP basis and are discussed in the Non-GAAP and Other Financial Measures section. (2) Acquisition and integration costs related to the acquisition of Bank of the West, recorded in non-interest expense. (3) Segment taxable equivalent basis (teb) offset amounts recorded in net interest income, total revenue and provision for (recovery of) income taxes: $7 million in both Q3-2026 and Q2-2026, and $10 million in Q3-2025; and $23 million for YTD-2026 and $29 million for YTD-2025. Certain comparative figures have been reclassified to conform with the current period’s presentation. Q3 2026 vs. Q3 2025 Corporate Services reported net loss was $1,151 million, and included the impact of the announced sale of BMO’s Transportation Finance and Vendor Finance businesses resulting in a charge of $962 million, primarily related to goodwill, compared with a reported net loss of $120 million in the prior year. Adjusted net loss was $178 million, compared with an adjusted net loss of $123 million. The higher adjusted net loss primarily reflected lower revenue and higher expenses. Q3 2026 vs. Q2 2026 Reported net loss of $1,151 million compared with a net loss of $110 million in the prior quarter, and adjusted net loss of $178 million compared with a net loss of $86 million. Compared with the prior quarter, the higher reported net loss was driven by the impact of the divestiture noted above, and the higher adjusted net loss reflected lower revenue and higher expenses. Q3 YTD 2026 vs. Q3 YTD 2025 Reported net loss was $1,471 million, compared with a reported net loss of $568 million in the prior year. The higher reported net loss primarily reflected the impact of the divestiture noted above, the impact of aligning accounting policies for employee vacation across legal entities in the prior year and a larger partial reversal of the FDIC special assessment in the current year. Adjusted net loss was $506 million, compared with an adjusted net loss of $496 million in the prior year, with higher expenses partially offset by higher revenue. Refer to the Non-GAAP and Other Financial Measures section for further information on non-GAAP amounts, measures and ratios, including adjusting items in this Operating Segments Performance Review section. 28 BMO Financial Group Third Quarter Report 2026
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Summary Quarterly Earnings Trends (1) TABLE 19 (Canadian $ in millions, except as noted) Q3-2026 Q2-2026 Q1-2026 Q4-2025 Q3-2025 Q2-2025 Q1-2025 Q4-2024 Net interest income 5,567 5,268 5,643 5,496 5,496 5,097 5,398 5,438 Non-interest revenue 4,329 4,299 4,181 3,845 3,492 3,582 3,868 3,519 Revenue 9,896 9,567 9,824 9,341 8,988 8,679 9,266 8,957 Provision for credit losses on impaired loans 708 734 739 750 773 765 859 1,107 Provision for credit losses on performing loans 14 5 7 5 24 289 152 416 Total provision for credit losses 722 739 746 755 797 1,054 1,011 1,523 Non-interest expense 6,678 5,330 5,753 5,556 5,105 5,019 5,427 4,427 Income before income taxes 2,496 3,498 3,325 3,030 3,086 2,606 2,828 3,007 Provision for income taxes 746 868 836 735 756 644 690 703 Reported net income (see below) 1,750 2,630 2,489 2,295 2,330 1,962 2,138 2,304 Acquisition and integration costs/reversal 4 2 7 3 4 (1) 7 27 Amortization of acquisition-related intangible assets 69 70 71 123 69 81 79 92 Change in fair value of contingent consideration 63 7 16 – – – – – Impact of divestitures 973 24 3 102 – – – – Legal provision/reversal (including related interest expense and legal fees) – – – – – – – (870) FDIC special assessment – – (35) (9) (4) 4 (5) (11) Impact of alignment of accounting policies – – – – – – 70 – Adjusted net income 2,859 2,733 2,551 2,514 2,399 2,046 2,289 1,542 Operating Segment Reported Revenue (2) Canadian P&C 3,257 3,097 3,258 3,102 3,076 2,953 3,043 2,913 U.S. Banking 3,034 2,859 2,896 2,875 2,830 2,814 2,964 2,735 Wealth Management 1,579 1,530 1,500 1,442 1,365 1,263 1,320 1,240 Capital Markets 2,127 2,114 2,212 1,819 1,776 1,779 2,073 1,600 Corporate Services (101) (33) (42) 103 (59) (130) (134) 469 Total revenue 9,896 9,567 9,824 9,341 8,988 8,679 9,266 8,957 Key Performance Metrics Diluted earnings per share ($) (3) 2.38 3.53 3.39 2.97 3.14 2.50 2.83 2.94 Adjusted diluted earnings per share ($) 3.96 3.67 3.48 3.28 3.23 2.62 3.04 1.90 Total PCL-to-average net loans and acceptances (annualized) (%) 0.41 0.45 0.44 0.44 0.47 0.63 0.58 0.91 Effective tax rate (%) 29.9 24.8 25.2 24.2 24.5 24.7 24.4 23.4 Adjusted effective tax rate (%) 24.0 24.6 25.0 23.6 24.5 24.7 24.5 21.7 Canadian/U.S. dollar average exchange rate ($) 1.4004 1.3721 1.3759 1.3887 1.3730 1.4203 1.4303 1.3641 (1) Adjusted results exclude certain items from reported results and are used to calculate adjusted measures as presented in the table above. Management assesses performance on a reported basis and an adjusted basis, and considers both to be useful. For further information on adjusting items, refer to the Non-GAAP and Other Financial Measures sections in both this document and BMO’s 2025 Annual Report. For details on the composition of non-GAAP amounts, measures and ratios, as well as supplementary financial measures, refer to the Glossary of Financial Terms. (2) Operating segment revenue, net interest income, total revenue and provision for income taxes are presented on a taxable equivalent basis (teb). The offset to the segments’ teb adjustments is reflected in Corporate Services. For further information, refer to the How BMO Reports Operating Segments Results section. (3) N e t i n c o m e a n d e a r n i n g s f r o m o u r b u s i n e s s o p e r a t i o n s a r e a t t r i b u t a b l e t o s h a r e h o l d e r s b y w a y o f E P S a n d d i l u t e d E P S . A d j u s t e d E P S a n d a d j u s t e d d i l u t e d E P S a r e n o n - G A A P m e a s u r e s . F o r f u r t h e r i n f o r m a t i o n , refer to the Non-GAAP and Other Financial Measures section. Certain comparative figures have been reclassified to conform with the current period’s presentation. Earnings in certain quarters are impacted by seasonal factors, such as higher employee expenses related to employee benefits and stock-based compensation for employees eligible to retire, which are recorded in the first quarter of each year, as well as the impact of fewer days in the second quarter relative to other quarters. Results are also impacted by foreign currency translation, primarily changes in the U.S. dollar relative to the Canadian dollar. Quarterly EPS is impacted by the semi-annual payment of dividends on certain equity instruments. Economic conditions, such as evolving trade policies and global events may also impact our results and the markets in which we operate. The table above outlines summary results for the fourth quarter of fiscal 2024 through the third quarter of fiscal 2026. A number of adjusting items impacted reported results in certain quarters. The past four quarters included the impact of divestitures, including the announced sale of BMO’s Transportation Finance and Vendor Finance businesses and certain U.S. branches. The first three quarters of fiscal 2026 also included a change in the fair value of contingent consideration related to the acquisition of Burgundy. The first quarter of fiscal 2025 included the impact of aligning accounting policies for employee vacation across legal entities. The fourth quarter of fiscal 2024 included a reversal of a fiscal 2022 legal provision, including accrued interest, associated with a predecessor bank, M&I Marshall and Ilsley Bank. Prior periods were impacted by an FDIC special assessment charge and reversal of prior charges, with all periods impacted by acquisition and integration costs, as well as the amortization of acquisition-related intangible assets and any impairments. Financial performance benefitted from the strength and diversification of our businesses, with improving revenue and earnings trends. Revenue growth in Canadian P&C reflected good customer acquisition and higher net interest margin. U.S. Banking revenue was driven by higher net interest margin and higher fee revenue, partially offset by balance sheet optimization initiatives. Wealth Management revenue benefitted from stronger global markets and steady growth in client assets and balance sheet volumes, as well as the inclusion of Burgundy beginning the first quarter of fiscal 2026. Insurance revenue is subject to variability resulting from market-related impacts. Capital Markets revenue, which is largely driven by market conditions that affect client activity, continued to benefit from robust trading activity from strong client flows, as well as stronger underwriting and advisory activity in recent quarters. Provisions for credit losses on impaired loans can vary depending on the economic environment and specific client circumstances. Provisions for credit losses on impaired loans increased in fiscal 2024, reflecting the impact of prolonged higher interest rates, tightening credit conditions and shifting consumer demand. In fiscal 2025 and fiscal 2026, provisions for credit losses on impaired loans moderated and have remained relatively stable with lower provisions in U.S. Banking and Capital Markets, offset by higher provisions in Canadian P&C. Provisions on performing loans can be impacted BMO Financial Group Third Quarter Report 2026 29
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by the macroeconomic outlook, the impact of model changes, portfolio credit migration and loan growth. In fiscal 2024 and the first half of fiscal 2025, the bank recorded higher provisions on performing loans, primarily reflecting portfolio credit migration and ongoing uncertainty in credit conditions. During the past five quarters, performing provisions were relatively stable. Non-interest expense was impacted by the specified items noted above and reflected disciplined expense management, while we continue to invest in our business to drive revenue growth. Expense growth has largely been driven by employee-related expenses and technology costs. The first quarter of fiscal 2026 included severance costs associated with advancing operational efficiencies across the enterprise. The effective tax rate has varied with legislative changes; changes in tax policy, including their interpretation by tax authorities and the courts; earnings mix, including the relative proportion of earnings attributable to the different jurisdictions in which we operate, the level of pre-tax income; and the level of investments or securities which generate tax credits, or tax-exempt income from securities. The reported effective tax rate was impacted by the implementation of the global minimum tax rules beginning the first quarter of fiscal 2025. Refer to the Non-GAAP and Other Financial Measures section for further information on non-GAAP amounts, measures and ratios, including adjusting items in this Summary Quarterly Earnings Trends section. Transactions with Related Parties In the ordinary course of business, we provide banking services to our key management personnel on the same terms that we offer these services to our preferred customers. Key management personnel are defined as those persons having authority and responsibility for planning, directing and/or controlling the activities of an entity, being the directors and most senior executives of the bank. We provide banking services to our joint ventures and associates on the same terms offered to our customers for these services. We also offer employees a subsidy on annual credit card fees. The bank’s policies and procedures for related party transactions did not materially change from October 31, 2025, as described in Note 27 of the audited annual consolidated financial statements of BMO’s 2025 Annual Report. Off-Balance Sheet Arrangements We enter into a number of off-balance sheet arrangements in the normal course of operations. The most significant of these are structured entities, credit instruments and guarantees, which are described in the Off-Balance Sheet Arrangements section of BMO’s 2025 Annual Report. We consolidate our own securitization vehicles, certain capital and funding vehicles, and other structured entities. We do not consolidate our customer securitization vehicles, certain capital vehicles, various BMO-managed funds or various other structured entities where investments are held. There have been no significant changes to the bank’s off-balance sheet arrangements since October 31, 2025. Accounting Policies and Critical Accounting Estimates and Judgments Material accounting policies are described in BMO’s 2025 Annual Report and in the notes to our annual consolidated financial statements for the year ended October 31, 2025, and in Note 1 of the unaudited interim consolidated financial statements, together with a discussion of certain accounting estimates that are considered particularly important as they require management to make significant judgments, some of which relate to matters that are inherently uncertain. Readers are encouraged to review the discussion in Note 1 of the audited annual consolidated financial statements of BMO’s 2025 Annual Report, as well as the updates provided in Note 1 of the unaudited interim consolidated financial statements. Allowance for Credit Losses The allowance for credit losses (ACL) primarily consists of allowances for impaired loans, which represent estimated losses related to impaired loans provided for but not yet written off, and allowances for performing loans, which is the bank’s best estimate of impairment in the existing portfolio for loans that have not yet been individually identified as impaired. Expected credit losses (ECL) are calculated on a probability-weighted basis, based on four economic scenarios described below, and are calculated for each exposure in the portfolio as a function of the probability of default (PD), exposure at default (EAD) and loss given default (LGD), with the timing of the loss also considered. Where there has been a significant increase in credit risk, lifetime ECL is recorded; otherwise, 12 months of ECL is generally recorded. Determining a significant increase in credit risk involves consideration of many different factors that will vary by product and risk segment. The principal factors considered in making this determination are the change in PD since origination and certain other criteria, such as 30-day past due and watchlist status. We may apply experienced credit judgment to reflect factors not captured in the results produced by the ECL models, as we deem necessary. In the current quarter, we applied experienced credit judgment to reflect the impact of the uncertain environment on credit conditions and the economy. We have controls and processes in place to govern the ECL process, including judgments and assumptions used in determining the allowance on performing loans. These judgments and assumptions may change over time, with the impact of any such change recorded in future periods. In establishing our allowance for performing loans, we attach probability weightings to economic scenarios that are representative of our view of economic and market conditions at the reporting date. The base scenario represents our view of the most probable outcome, as well as upside, downside, and severe downside scenarios, all of which have been developed by our Economics group. When changes in economic performance in the forecasts are measured, we use real GDP as the basis, which acts as the key driver for movements in many of the other economic and market variables used, including equity market and volatility indices, corporate credit spreads, unemployment rates, housing prices and consumer credit. In addition, we also consider industry-specific variables, where applicable. Many of the variables have a high degree of interdependency, and as such, there is no single variable to which the allowance is sensitive. Our total allowance for credit losses as at July 31, 2026, was $6,030 million ($5,739 million as at October 31, 2025) and comprised an allowance on performing loans of $4,762 million and an allowance on impaired loans of $1,268 million ($4,709 million and $1,030 million, respectively, as at 30 BMO Financial Group Third Quarter Report 2026
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October 31, 2025). The allowance on performing loans increased $53 million from the fourth quarter of fiscal 2025, primarily driven by the impact of model changes in the second quarter of 2026, partially offset by improvement in portfolio credit quality and movements in foreign exchange rates. Information on the Provision for Credit Losses for the three months ended July 31, 2026, can be found in the Total Provision for Credit Losses section. For additional information, refer to the Risk Management section, Allowance for Credit Losses section of BMO’s 2025 Annual Report, Note 3 of the audited annual consolidated financial statements, as well as Note 3 of the unaudited interim consolidated financial statements. This Accounting Policies and Critical Accounting Estimates and Judgments section contains forward-looking statements. Please refer to the Caution Regarding Forward-Looking Statements. Future Changes in Accounting Policies We monitor the potential changes proposed by the International Accounting Standards Board (IASB) and analyze the effect that changes in the standards may have on BMO’s financial reporting and accounting policies. New standards and amendments to existing standards, which are effective for the bank in the future, can be found in Note 1 of the audited annual consolidated financial statements of BMO’s 2025 Annual Report. Other Regulatory Developments We continue to monitor and prepare for other regulatory developments, including those referenced elsewhere in this document. For a comprehensive discussion of other regulatory developments, refer to the Enterprise-Wide Capital Management section, the Risks That May Affect Future Results section, the Liquidity and Funding Risk section, and the Legal and Regulatory Compliance Risk section of BMO’s 2025 Annual Report. Liquidity Adequacy Requirement In January 2026, OSFI published its final Liquidity Adequacy Requirements (LAR) Guideline for fiscal 2026, which came into effect on May 1, 2026. The changes primarily relate to retail deposit categorization with updated guidance on the retail structured products and their treatment under LAR. These changes did not have a material impact on our liquidity and funding practices. Risk Management BMO’s risk management policies and processes, designed to identify, assess, measure, manage and report its credit and counterparty, market, liquidity and funding, operational non-financial, including artificial intelligence, cyber, information and other technology-related risks, legal and regulatory compliance, strategic, environmental and social, and reputation risks are outlined in the Enterprise-Wide Risk Management section of BMO’s 2025 Annual Report. Top and Emerging Risks That May Affect Future Results BMO’s top and emerging risks and other factors that may affect future results are described in the Enterprise-Wide Risk Management section of BMO’s 2025 Annual Report. These risks have the potential to materially impact BMO’s financial results, our operational efficiency, strategic direction or reputation. We continue to monitor the environment in which the bank operates, in order to identify and respond to any adverse developments, such as changes in general economic conditions and trade disputes, and take appropriate steps to reduce the impact on our results. For developments on general economic conditions and trade disputes, refer to the Economic Developments and Outlook section. Geopolitical and Trade Developments Geopolitical uncertainty, international conflicts and trade disruptions continue to pose risks globally and for BMO. The ongoing war in Iran continues to contribute to elevated energy prices, supply chain disruption, inflationary pressure and slower economic growth, with impacts on BMO’s businesses and clients. BMO’s customers continue to depend on global trade and economic expansion. The U.S. decision not to extend USMCA’s initial terms on July 1, 2026 and the new U.S. tariffs on an array of Canadian exports could add to a prolonged period of trade policy uncertainty. Given BMO’s integrated North American footprint, the bank is actively assessing potential impacts on its clients and operations related to future trade negotiations. BMO actively monitors and manages geopolitical-related risks through regular reporting and targeted management actions across impacted areas, including counterparties, credit, liquidity, operations and technology. Stress scenarios are reviewed and refreshed on an ongoing basis to support the continued resilience of BMO’s funding and capital positions as global conditions evolve. For further information on the North American economic outlook, refer to the Economic Developments and Outlook section. BMO Financial Group Third Quarter Report 2026 31
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Real Estate Secured Lending Real Estate Secured Lending includes residential mortgage and home equity line of credit (HELOC) exposures. The following tables provide a breakdown of residential mortgages and home equity lines of credit by geographic region, as well as insured and uninsured balances. Residential mortgages and home equity lines of credit are secured by residential properties. Canadian Real Estate Secured Lending TABLE 20 (Canadian $ in millions, except as noted) Residential mortgages Amortizing home equity lines of credit Total amortizing real estate secured lending Non-amortizing real estate secured lending Total Canadian real estate secured lending As at July 31, 2026 164,183 40,855 205,038 13,759 218,797 As at April 30, 2026 162,090 39,695 201,785 13,844 215,629 Residential Mortgages (1) TABLE 21 As at July 31, 2026 As at April 30, 2026 (Canadian $ in millions, except as noted) Outstanding Balances For the three months ended Outstanding Balances For the three months ended Region (2) Insured (3) Uninsured Total % of total Average LTV uninsured (4) Insured (3) Uninsured Total % of total Average LTV uninsured (4) Atlantic 3,133 4,339 7,472 3.8% 70% 3,162 4,206 7,368 3.8% 69% Quebec 7,123 13,079 20,202 10.3% 70% 7,488 13,102 20,590 10.6% 70% Ontario 14,700 71,664 86,364 43.9% 70% 14,469 70,085 84,554 43.5% 70% Alberta 8,712 9,050 17,762 9.0% 71% 8,858 8,703 17,561 9.1% 71% British Columbia 4,237 24,531 28,768 14.6% 67% 4,216 24,180 28,396 14.7% 68% All other Canada 1,961 1,654 3,615 1.8% 73% 2,015 1,606 3,621 1.9% 71% Total Canada 39,866 124,317 164,183 83.4% 70% 40,208 121,882 162,090 83.6% 70% United States 59 32,682 32,741 16.6% 76% 59 31,667 31,726 16.4% 72% Total 39,925 156,999 196,924 100% 71% 40,267 153,549 193,816 100% 70% (1) Reporting methodologies are in accordance with OSFI’s Residential Mortgage Underwriting Practices and Procedures (B-20) Guideline. (2) Region is based upon address of the property mortgaged. (3) Insured mortgages are defined as mortgages that are insured individually or in bulk through an eligible insurer (i.e., CMHC, Sagen MI CanadaTM). (4) Loan-to-value (LTV) is based on original outstanding balances for mortgages and authorized amounts for HELOCs, divided by the value of the collateral at point of origination. Home Equity Lines of Credit (1) TABLE 22 As at July 31, 2026 As at April 30, 2026 (Canadian $ in millions, except as noted) Portfolio For the three months ended Portfolio For the three months ended Region (2) Outstanding Balances % Authorizations % Average LTV (4) Outstanding Balances % Authorizations % Average LTV (4) Atlantic 1,231 2.0% 2,327 1.9% 68% 1,202 2.0% 2,282 1.9% 67% Quebec 9,880 16.1% 19,940 16.0% 72% 9,682 16.1% 19,712 16.1% 71% Ontario 27,157 44.2% 50,589 40.6% 66% 26,798 44.6% 50,057 40.8% 66% Alberta 3,552 5.8% 7,845 6.3% 67% 3,440 5.7% 7,689 6.3% 66% British Columbia 12,051 19.6% 22,505 18.1% 64% 11,681 19.4% 22,071 18.0% 64% All other Canada 743 1.2% 1,525 1.2% 70% 736 1.2% 1,512 1.2% 70% Total Canada 54,614 88.9% 104,731 84.1% 67% 53,539 89.0% 103,323 84.3% 66% United States 6,826 11.1% 19,760 15.9% 56% 6,611 11.0% 19,271 15.7% 57% Total 61,440 100% 124,491 100% 66% 60,150 100% 122,594 100% 65% Refer to footnote references in the Residential Mortgages table above. Residential Mortgages by Remaining Term of Amortization (1) (2) TABLE 23 As at July 31, 2026 Amortization period < 5 Years % 6-10 Years % 11-15 Years % 16-20 Years % 21-25 Years % 26-30 Years % 31-35 Years % > 35 Years % Canada (3) 0.7% 2.8% 8.0% 20.2% 31.7% 31.0% 2.3% 3.3% United States (4) 0.3% 1.8% 2.9% 3.7% 19.2% 71.8% 0.1% 0.2% Total 0.7% 2.6% 7.2% 17.5% 29.5% 37.7% 2.0% 2.8% As at April 30, 2026 Amortization period < 5 Years % 6-10 Years % 11-15 Years % 16-20 Years % 21-25 Years % 26-30 Years % 31-35 Years % > 35 Years % Canada (3) 0.7% 2.8% 8.1% 19.9% 33.0% 29.3% 2.2% 4.0% United States (4) 0.3% 1.6% 3.1% 3.3% 15.6% 75.9% 0.1% 0.1% Total 0.7% 2.6% 7.3% 17.1% 30.1% 37.0% 1.9% 3.3% (1) In Canada, the remaining amortization is based on the current balance, interest rate, customer payment amount and payment frequency. The contractual payment schedule is used in the United States. (2) Reporting methodologies are in accordance with OSFI’s B-20 Guideline. (3) As a result of increases in interest rates, the portfolio included less than $0.1 billion (relatively unchanged from April 30, 2026) of variable-rate mortgages in negative amortization, with all of the contractual payments in the current period being applied to interest, and the portion of interest due that is not met by each payment added to the principal. (4) A large proportion of U.S.-based mortgages in the longer-amortization band are primarily associated with modification programs for troubled borrowers and regulator-initiated mortgage refinancing programs. 32 BMO Financial Group Third Quarter Report 2026
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International Exposures BMO’s geographic exposures outside of Canada and the United States are subject to a risk management framework that incorporates assessments of the economic and political risk in each region or country. These exposures are also managed within limits based on product, entity and country of ultimate risk. Our total net exposure to these regions is set out in the table below. The table outlines total net exposure for funded lending and undrawn commitments, securities (including cash products, traded credit and credit default swap activity), repo-style transactions and derivatives. Repo-style transactions and derivatives exposure are reported at fair value. Derivatives exposures incorporate transaction netting where master netting agreements with counterparties have been entered into, and collateral offsets for counterparties where a Credit Support Annex is in effect. Exposure by Region TABLE 24 As at July 31, 2026 As at April 30, 2026 (1) (Canadian $ in millions) Funded Lending and Commitments Securities Repo-Style Transactions and Derivatives Region Bank Corporate Sovereign Total Bank Corporate Sovereign Total Bank Corporate Sovereign Total Total Net Exposure Total Net Exposure Europe (excluding United Kingdom) 928 3,790 – 4,718 897 500 7,026 8,423 2,604 703 284 3,591 16,732 15,267 United Kingdom 182 5,948 191 6,321 382 260 2,853 3,495 961 1,079 81 2,121 11,937 11,552 Latin America 2,429 4,085 – 6,514 – 170 – 170 79 189 23 291 6,975 6,944 Asia-Pacific 2,429 3,033 32 5,494 312 79 548 939 434 202 269 905 7,338 7,283 Africa and Middle East 1,892 1,132 107 3,131 2 50 19 71 5 7 986 998 4,200 6,393 Other (2) – 2 12 14 55 – 3,653 3,708 – 10 1,545 1,555 5,277 4,566 Total 7,860 17,990 342 26,192 1,648 1,059 14,099 16,806 4,083 2,190 3,188 9,461 52,459 52,005 (1) Certain balances as at April 30, 2026, have been revised from amounts previously disclosed in BMO’s Second Quarter 2026 Report to Shareholders. (2) Primarily exposure to supranational entities. Caution T h i s R i s k M a n a g e m e n t s e c t i o n c o n t a i n s f o r w a r d - l o o k i n g s t a t e m e n t s . P l e a s e r e f e r t o t h e C a u t i o n R e g a r d i n g F o r w a r d - L o o k i n g S t a t e m e n t s . Market Risk BMO’s market risk management practices and key measures are outlined in the Market Risk section of BMO’s 2025 Annual Report. Linkages between Balance Sheet Items and Market Risk Disclosures The table below presents items reported in our Consolidated Balance Sheet that are subject to market risk, comprising balances that are subject to either traded risk or non-traded risk measurement techniques. TABLE 25 As at July 31, 2026 As at October 31, 2025 Consolidated Subject to market risk Not subject Consolidated Subject to market risk Not subject Primary risk factors for Balance Traded Non-traded to market Balance Traded Non-traded to market non-traded risk (Canadian $ in millions) Sheet risk (1) risk (2) risk Sheet risk (1) risk (2) risk balances Assets Subject to Market Risk Cash and cash equivalents 74,086 – 74,086 – 67,484 – 67,484 – Interest rate Interest bearing deposits with banks 3,200 911 2,289 – 2,838 456 2,382 – Interest rate Securities 458,626 172,817 285,809 – 423,476 172,680 250,796 – Interest rate, credit spread, equity Securities borrowed or purchased under resale agreements 109,018 – 109,018 – 129,421 – 129,421 – Interest rate Loans and acceptances (net of allowance for credit losses) 696,495 6,260 690,235 – 677,161 6,271 670,890 – Interest rate, foreign exchange Derivative instruments 67,997 63,694 4,303 – 57,151 51,829 5,322 – Interest rate, foreign exchange Customers’ liability under acceptances 1,432 – 1,432 – 711 – 711 – Interest rate Other assets 127,831 8,318 19,910 99,603 118,560 6,411 12,460 99,689 Interest rate Total assets 1,538,685 252,000 1,187,082 99,603 1,476,802 237,647 1,139,466 99,689 Liabilities Subject to Market Risk Deposits 1,017,834 56,350 961,484 – 976,202 49,093 927,109 – Interest rate, foreign exchange Derivative instruments 69,597 65,413 4,184 – 58,729 54,770 3,959 – Interest rate, foreign exchange Acceptances 1,432 – 1,432 – 711 – 711 – Interest rate Securities sold but not yet purchased 51,098 51,098 – – 54,876 54,876 – – Interest rate Securities lent or sold under repurchase agreements 124,983 – 124,983 – 134,967 – 134,967 – Interest rate Other liabilities 179,673 – 109,670 70,003 154,717 – 91,688 63,029 Interest rate Subordinated debt 7,495 – 7,495 – 8,500 – 8,500 – Interest rate Total liabilities 1,452,112 172,861 1,209,248 70,003 1,388,702 158,739 1,166,934 63,029 (1) Primarily comprises balance sheet items that are subject to the trading and underwriting risk management framework and recorded at fair value through profit or loss. (2) Primarily comprises balance sheet items that are subject to the structural balance sheet insurance risk management framework and secured financing transactions. BMO Financial Group Third Quarter Report 2026 33
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Trading Market Risk Measures Average Total Trading Value at Risk (VaR) decreased quarter-over-quarter from lower interest rate and equity risks, partially offset by reduced diversification. Total Trading Value at Risk (1) TABLE 26 For the quarter ended July 31, 2026 April 30, 2026 July 31, 2025 Quarter-end Average High Low Average Average Commodity VaR 10.4 11.1 16.4 5.8 10.0 9.8 Equity VaR 6.9 11.6 20.0 4.9 12.4 19.1 Foreign exchange VaR 0.8 1.5 3.0 0.7 1.6 2.0 Interest rate VaR (2) 27.6 26.0 30.8 22.8 31.9 27.4 Diversification (20.5) (23.1) nm nm (27.5) (19.0) Total Trading VaR 25.2 27.1 33.2 20.0 28.4 39.3 (1) O n e - d a y m e a s u r e u s i n g a 9 9 % c o n f i d e n c e i n t e r v a l . G a i n s a r e p r e s e n t e d i n b r a c k e t s a n d l o s s e s a r e p r e s e n t e d a s p o s i t i v e n u m b e r s . (2) Interest rate VaR includes general credit spread risk. nm - not meaningful Structural (Non-Trading) Market Risk Our structural market risk strategy and profile remains consistent with prior periods. The net balance sheet is fully invested in an intermediate duration target interest rate profile. Structural economic value exposure to rising rates and structural economic value benefit to falling rates increased, compared with April 30, 2026, primarily due to modelled deposit pricing being more rate-sensitive at higher projected interest rate levels following the increase in term market rates during the current quarter. Structural earnings benefit to rising interest rates and structural earnings exposure to falling interest rates increased, compared with April 30, 2026, as more net assets are scheduled to reprice over the next 12 months. Structural Interest Rate Sensitivity (1) (2) TABLE 27 Economic value sensitivity Earnings sensitivity over the next 12 months July 31, 2026 April 30, 2026 July 31, 2025 July 31, 2026 April 30, 2026 July 31, 2025(Pre-tax Canadian $ equivalent in millions) Canada (3) United States Total Total Total Canada (3) United States Total Total Total 100 basis point increase (1,256) (854) (2,110) (2,059) (1,744) 110 181 291 233 349 100 basis point decrease 1,181 317 1,498 1,375 1,021 (118) (200) (318) (282) (353) (1) Losses are presented in brackets and gains are presented as positive numbers. (2) Interest rate sensitivities assume an immediate and sustained parallel shift in interest rates across the entire yield curve as at the end of the period. Earnings sensitivity assumes a constant balance sheet. Economic value sensitivity assumes a runoff balance sheet. (3) Includes Canadian dollar and other currencies. Liquidity and Funding Risk Liquidity and funding risk is managed under a robust risk management framework. There were no material changes in the framework during the quarter. BMO continued to maintain a strong liquidity position in the third quarter of 2026. Both customer loans and deposits increased during the quarter. Wholesale funding increased, reflecting higher net issuances. BMO’s liquidity metrics, including the Liquidity Coverage Ratio (LCR) and Net Stable Funding Ratio (NSFR), exceeded internal targets and regulatory requirements. BMO’s liquid assets are primarily held in our trading businesses, as well as in liquidity portfolios that are maintained for contingent liquidity risk management purposes and as investments of excess structural liquidity. Liquid assets include unencumbered, high-quality assets that are marketable, can be pledged as security for borrowings, and can be converted to cash in a time frame that meets our liquidity and funding requirements. BMO’s liquid assets are summarized in the table below. In the normal course of business, we may encumber a portion of cash and securities holdings as collateral in support of trading activities and participation in clearing and payment systems in Canada and abroad. In addition, we may receive liquid assets as collateral and may re-pledge these assets in exchange for cash or as collateral in support of trading activities. Net unencumbered liquid assets, defined as on-balance sheet assets, such as BMO-owned cash and securities and securities borrowed or purchased under resale agreements, plus other off-balance sheet eligible collateral received, less assets encumbered as collateral, totalled $404.8 billion as at July 31, 2026, compared with $377.6 billion as at April 30, 2026. The increase in unencumbered liquid assets was due to higher securities and cash balances. Net unencumbered liquid assets are primarily held at the parent bank level, at BMO Bank N.A., and in our broker/dealer operations. In addition to liquid assets, BMO has access to the Bank of Canada’s lending assistance programs, the Federal Reserve Bank discount window in the United States, the Bank of England’s Sterling Monetary Framework, and European Central Bank standby liquidity facilities. We do not consider central bank facilities as a source of available liquidity when assessing the soundness of our liquidity position. In addition to cash and securities holdings, we may also pledge other assets, including mortgages and loans, to raise long-term secured funding. BMO’s total encumbered assets and unencumbered liquid assets are summarized in the Asset Encumbrance table. 34 BMO Financial Group Third Quarter Report 2026
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Liquid Assets TABLE 28 As at July 31, 2026 As at April 30, 2026 Other cash & Net Net Bank-owned securities Total gross Encumbered unencumbered unencumbered (Canadian $ in millions) assets received assets (1) assets assets (2) assets (2) Cash and cash equivalents 74,086 – 74,086 61 74,025 63,764 Deposits with other banks 3,200 – 3,200 – 3,200 3,325 Securities and securities borrowed or purchased under resale agreements Sovereigns/Central banks/Multilateral development banks 210,272 98,085 308,357 139,907 168,450 152,968 NHA mortgage-backed securities and U.S. agency mortgage-backed securities and collateralized mortgage obligations 139,644 15,254 154,898 93,171 61,727 60,707 Corporate and other debt 41,317 31,532 72,849 36,260 36,589 36,608 Corporate equity 67,393 77,690 145,083 97,834 47,249 44,274 Total securities and securities borrowed or purchased under resale agreements 458,626 222,561 681,187 367,172 314,015 294,557 NHA mortgage-backed securities (reported as loans at amortized cost) (3) 21,113 – 21,113 7,528 13,585 16,001 Total liquid assets 557,025 222,561 779,586 374,761 404,825 377,647 (1) G r o s s a s s e t s i n c l u d e b a n k - o w n e d a s s e t s a n d c a s h a n d s e c u r i t i e s r e c e i v e d f r o m t h i r d p a r t i e s . (2) Net unencumbered assets are defined as total gross assets less encumbered assets. (3) Under IFRS, National Housing Act (NHA) mortgage-backed securities that include mortgages owned by BMO as the underlying collateral are classified as loans. Unencumbered NHA mortgage-backed securities have liquidity value and are included as liquid assets under BMO’s Liquidity and Funding Risk Management Framework. This amount is shown as a separate line item, NHA mortgage-backed securities. Asset Encumbrance TABLE 29 Encumbered (2) Net unencumbered (Canadian $ in millions) Total gross Pledged as Other Other Available as As at July 31, 2026 assets (1) collateral encumbered unencumbered (3) collateral (4) Cash and deposits with other banks 77,286 – 61 – 77,225 Securities (5) 702,300 274,450 100,250 25,816 301,784 Loans 675,382 74,382 1,958 413,572 185,470 Other assets Derivative instruments 67,997 – – 67,997 – Customers' liability under acceptances 1,432 – – 1,432 – Premises and equipment 6,331 – – 6,331 – Goodwill 16,086 – – 16,086 – Intangible assets 5,158 – – 5,158 – Current tax assets 1,965 – – 1,965 – Deferred tax assets 3,162 – – 3,162 – Receivable from brokers, dealers and clients 45,928 – – 45,928 – Other 49,201 16,637 – 32,564 – Total other assets 197,260 16,637 – 180,623 – Total assets 1,652,228 365,469 102,269 620,011 564,479 Encumbered (2) Net unencumbered (Canadian $ in millions) Total gross Pledged as Other Other Available as As at April 30, 2026 assets (1) collateral encumbered unencumbered (3) collateral (4) Cash and deposits with other banks 67,147 – 58 – 67,089 Securities (5) 695,122 273,091 111,473 25,435 285,123 Loans 655,586 68,435 1,973 407,887 177,291 Other assets Derivative instruments 62,358 – – 62,358 – Customers' liability under acceptances 1,195 – – 1,195 – Premises and equipment 6,169 – – 6,169 – Goodwill 16,596 – – 16,596 – Intangible assets 5,043 – – 5,043 – Current tax assets 1,870 – – 1,870 – Deferred tax assets 2,776 – – 2,776 – Receivable from brokers, dealers and clients 50,333 – – 50,333 – Other 45,043 12,863 – 32,180 – Total other assets 191,383 12,863 – 178,520 – Total assets 1,609,238 354,389 113,504 611,842 529,503 (1) Gross assets include on-balance sheet and off-balance sheet assets. (2) Pledged as collateral refers to the portion of on-balance sheet assets and other cash and securities that is pledged through repurchase agreements, securities lending, derivative contracts and requirements associated with participation in clearing houses and payment systems. Other encumbered assets include assets that are restricted for legal or other reasons, such as minimum required deposits at central banks, short sales and certain U.S. agency securities that have been sold to third parties but are consolidated under IFRS. (3) Other unencumbered assets include select liquid asset holdings that management believes are not readily available to support BMO’s liquidity requirements. These include securities of $25.8 billion as at July 31, 2026, and include securities held at BMO’s insurance subsidiary, seller financing securities and certain investments held at our merchant banking business. Other unencumbered assets include mortgages and loans that may be securitized to access secured funding. (4) Loans included in available as collateral represent loans currently lodged at central banks that may be used to access central bank funding. Loans available for pledging as collateral do not include other sources of additional liquidity that may be realized from BMO’s loan portfolio, such as incremental securitization, covered bond issuances and U.S. Federal Home Loan Bank (FHLB) advances. (5) Includes securities, securities borrowed or purchased under resale agreements and NHA mortgage-backed securities (reported as loans at amortized cost). BMO Financial Group Third Quarter Report 2026 35
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Net Unencumbered Liquid Assets by Legal Entity TABLE 30 (Canadian $ in millions) As at July 31, 2026 As at April 30, 2026 BMO (parent) 242,074 226,209 BMO Bank N.A. 131,772 119,446 Broker dealers 30,979 31,992 Total net unencumbered liquid assets by legal entity 404,825 377,647 Funding Strategy BMO’s funding strategy requires that secured and unsecured wholesale funding used to support loans and less liquid assets must have a term (typically two to ten years) that will support the effective term to maturity of these assets. Secured and unsecured wholesale funding for liquid trading assets is largely shorter term (maturing in one year or less), is aligned with the liquidity of the assets being funded and is subject to limits on aggregate maturities across different periods. Supplemental liquidity pools are funded largely with wholesale term funding. We maintain a large and stable base of customer deposits that, in combination with our strong capital position, is a source of strength. This supports the maintenance of a sound liquidity position and reduces reliance on wholesale funding. Customer deposits totalled $710.9 billion as at July 31, 2026, increasing from $693.4 billion as at April 30, 2026, due to underlying growth and the impact of the stronger U.S. dollar. Total secured and unsecured wholesale funding outstanding, which largely consists of negotiable marketable securities, was $290.5 billion as at July 31, 2026, with $77.5 billion sourced as secured funding and $213.0 billion sourced as unsecured funding. Wholesale funding outstanding increased from $264.6 billion as at April 30, 2026, due to net issuances during the current quarter. The mix and maturities of BMO’s wholesale term funding are outlined in the following table. We maintain a sizeable portfolio of unencumbered liquid assets, totalling $404.8 billion as at July 31, 2026, that can be monetized to meet potential funding requirements, as described in the Unencumbered Liquid Assets section above. Wholesale Funding Maturities (1) TABLE 31 As at July 31, 2026 As at April 30, 2026 Less than 1 to 3 3 to 6 6 to 12 Subtotal less 1 to 2 Over (Canadian $ in millions) 1 month months months months than 1 year years 2 years Total Total Deposits from banks 3,963 1,069 2,449 2,034 9,515 – – 9,515 7,041 Certificates of deposit and commercial paper 4,232 12,235 29,692 39,844 86,003 2,606 190 88,799 84,602 Bearer deposit notes 1,283 2,701 959 595 5,538 – – 5,538 4,693 Asset-backed commercial paper (ABCP) 2,469 5,555 7,506 1,432 16,962 – – 16,962 15,550 Senior unsecured medium-term notes 473 3,777 5,395 15,184 24,829 13,991 38,939 77,759 72,311 Senior unsecured structured notes (2) 731 556 860 1,582 3,729 2,435 17,742 23,906 14,023 Secured funding Mortgage and HELOC securitizations – 1,393 432 1,037 2,862 2,462 11,815 17,139 18,069 Covered bonds – 4,452 4,445 1,134 10,031 3,383 16,032 29,446 24,496 Other asset-backed securitizations (3) – – – – – 445 3,709 4,154 4,025 Federal Home Loan Bank advances – – 1,402 – 1,402 6,988 1,403 9,793 11,458 Subordinated debt – – – – – – 7,494 7,494 8,335 Total 13,151 31,738 53,140 62,842 160,871 32,310 97,324 290,505 264,603 Of which: Secured 2,469 11,400 13,785 3,603 31,257 13,278 32,959 77,494 73,598 Unsecured 10,682 20,338 39,355 59,239 129,614 19,032 64,365 213,011 191,005 Total (4) 13,151 31,738 53,140 62,842 160,871 32,310 97,324 290,505 264,603 (1) Wholesale unsecured funding primarily includes funding raised through the issuance of negotiable marketable securities. Wholesale funding excludes repo transactions and ABCP issued by certain ABCP conduits that are not consolidated for financial reporting purposes. (2) Includes structured notes issued to institutional investors and exchange-traded notes. Effective the third quarter of 2026, the classification of unsecured structured notes was updated to align with the retail categorization of structured notes under OSFI’s Liquidity Adequacy Requirements beginning May 1, 2026. (3) Includes credit card loan securitizations. (4) T o t a l w h o l e s a l e f u n d i n g c o m p r i s e d C a n a d i a n - d o l l a r - d e n o m i n a t e d f u n d i n g t o t a l l i n g $ 6 0 . 8 b i l l i o n ( $ 5 5 . 4 b i l l i o n a s a t April 30, 2026) a n d U . S . - d o l l a r - d e n o m i n a t e d a n d o t h e r f o r e i g n - c u r r e n c y - d e n o m i n a t e d f u n d i n g totalling $229.7 billion as at July 31, 2026 ($209.2 billion as at April 30, 2026). Diversification of our wholesale funding sources is an important part of our overall liquidity management strategy. BMO’s wholesale funding activities are well-diversified by jurisdiction, currency, investor segment, instrument type and maturity profile. BMO maintains ready access to long-term wholesale funding through various borrowing programs, including a European Note Issuance Program, Canadian, Australian and U.S. Medium-Term Note programs, Canadian and U.S. mortgage securitizations, Canadian credit card loans and home equity line of credit (HELOC) securitizations, covered bonds, and Canadian and U.S. senior unsecured deposits. Our wholesale funding plan seeks to ensure sufficient funding capacity is available to execute our business strategies. The funding plan considers expected maturities, as well as asset and liability growth projected for our businesses in our forecasting and planning processes, and assesses funding needs in relation to the sources available. The funding plan is reviewed annually by the senior management committees with specific related responsibilities and approved by the Risk Review Committee, and is regularly updated to reflect actual results and incorporate updated forecast information. Additional information on Liquidity and Funding Risk governance can be found in the Liquidity and Funding Risk section of BMO’s 2025 Annual Report. Please also see the Risk Management section. 36 BMO Financial Group Third Quarter Report 2026
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Credit Ratings The credit ratings assigned to BMO’s short-term and senior long-term debt securities by external rating agencies are important in raising both capital and funding to support the bank’s business operations. Maintaining strong credit ratings allows us to access the wholesale markets at competitive pricing levels. Should BMO’s credit ratings experience a downgrade, our cost of funding may increase and our access to funding and capital through the wholesale markets could be constrained. A material downgrade of BMO’s ratings could also have other consequences, including those set out in Note 7 of the audited annual consolidated financial statements of BMO’s 2025 Annual Report. The credit ratings assigned to BMO’s senior debt by rating agencies are indicative of high-grade, high-quality issues. TABLE 32 As at July 31, 2026 Rating agency (1) Short-term debt Senior debt (2) Long-term deposits/Issuer rating (3) Subordinated debt (NVCC) Outlook Moody’s P-1 A2 Aa2 Baa1 (hyb) Stable S&P A-1 A- A+ BBB+ Stable Fitch F1+ AA- AA+ A Stable DBRS R-1 (high) AA (low) AA A (low) Stable (1) Credit ratings are not recommendations to purchase, hold or sell a financial obligation and do not address the market price or suitability for a particular investor. Ratings are subject to revision or withdrawal at any time by the rating organization. Our rating classes may differ from the rating category nomenclatures used by the rating agencies (e.g., Fitch Issuer Default Rating assigned to BMO is “AA-”). (2) Subject to conversion under the Bank Recapitalization (Bail-In) Regime. (3) Issuer rating is applicable to any long-term senior unsecured debt issued that is excluded from the Bail-In Regime. We are required to deliver collateral to certain counterparties in the event of a downgrade of BMO’s current credit rating. The incremental collateral required is based on mark-to-market exposure, collateral valuations and collateral threshold arrangements, as applicable. As at July 31, 2026, we would be required to provide additional collateral to counterparties totalling $335 million, $814 million and $1,821 million, as a result of a one-notch, two-notch and three-notch downgrade, respectively. Caution This Credit Ratings section contains forward-looking statements. Please refer to the Caution Regarding Forward-Looking Statements. BMO Financial Group Third Quarter Report 2026 37
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Liquidity Coverage Ratio The Liquidity Coverage Ratio (LCR) is calculated on a daily basis as the ratio of the stock of High-Quality Liquid Assets (HQLA) held to total net stressed cash outflows over the next 30 calendar days, in accordance with OSFI’s LAR Guideline, as summarized in the table below. BMO’s HQLA primarily comprises cash, highly-rated debt issued or backed by governments, highly-rated covered bonds and non-financial corporate debt, and non-financial equities that are part of a major stock index. Net cash flows include outflows from deposits, secured and unsecured wholesale funding, commitments and potential collateral requirements, offset by permitted inflows from loans, securities lending activities and other non-HQLA debt maturing over a 30-day horizon. Weightings prescribed by OSFI are applied to cash flows and HQLA to arrive at the weighted values and the LCR. The LCR does not reflect liquidity in BMO Financial Corp. (BFC) in excess of 100%, because of limitations on the transfer of liquidity between BFC and the parent bank. Canadian domestic systemically important banks (D-SIBs), including BMO, are required to maintain a minimum LCR of 100%. The average daily LCR for the quarter ended July 31, 2026, was 125%, equivalent to a surplus of $51.4 billion above the regulatory minimum. The LCR decreased 3% from 128% in the prior quarter, as an increase in HQLA was more than offset by an increase in net cash outflows. While banks are required to maintain an LCR of greater than 100% in normal conditions, they are also expected to be able to utilize HQLA during a period of stress, which may result in an LCR of less than 100% during such a period. The LCR is only one measure of a bank’s liquidity position and does not fully capture all of its liquid assets or the funding alternatives that may be available during a period of stress. BMO’s total liquid assets are shown in the Liquid Assets table. TABLE 33 For the quarter ended July 31, 2026 (Canadian $ in billions, except as noted) Total unweighted value (average) (1) (2) Total weighted value (average) (2) (3) High-Quality Liquid Assets Total high-quality liquid assets (HQLA) * 257.4 Cash Outflows Retail deposits and deposits from small business customers, of which: 300.0 20.8 Stable deposits 143.3 4.3 Less stable deposits 156.7 16.5 Unsecured wholesale funding, of which: 341.7 146.6 Operational deposits (all counterparties) and deposits in networks of cooperative banks 171.6 42.4 Non-operational deposits (all counterparties) 149.5 83.6 Unsecured debt 20.6 20.6 Secured wholesale funding * 44.2 Additional requirements, of which: 275.5 65.2 Outflows related to derivatives exposures and other collateral requirements 46.7 15.6 Outflows related to loss of funding on debt products 3.9 3.9 Credit and liquidity facilities 224.9 45.7 Other contractual funding obligations 1.0 – Other contingent funding obligations 607.5 12.9 Total cash outflows * 289.7 Cash Inflows Secured lending (e.g., reverse repos) 219.8 43.4 Inflows from fully performing exposures 19.2 10.3 Other cash inflows 30.0 30.0 Total cash inflows 269.0 83.7 For the quarter ended July 31, 2026 Total adjusted value (4) Total HQLA 257.4 Total net cash outflows 206.0 Liquidity Coverage Ratio (%) (2) 125 For the quarter ended April 30, 2026 Total adjusted value (4) Total HQLA 256.2 Total net cash outflows 200.6 Liquidity Coverage Ratio (%) 128 * Disclosure is not required under the LCR disclosure standard. (1) Unweighted values are calculated at market value (for HQLA) or as outstanding balances maturing or callable within 30 days (for inflows and outflows). (2) Values are calculated based on the simple average of the daily LCR over 64 business days in the third quarter of fiscal 2026. (3) Weighted values are calculated after the application of the weights prescribed under OSFI’s LAR Guideline for HQLA and cash inflows and outflows. (4) Adjusted values are calculated based on total weighted values after applicable caps, as defined by the LAR Guideline. 38 BMO Financial Group Third Quarter Report 2026
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Net Stable Funding Ratio The Net Stable Funding Ratio (NSFR) is a regulatory liquidity metric that assesses the stability of a bank’s funding profile in relation to the liquidity value of its assets, calculated in accordance with OSFI’s LAR Guideline. Unlike the LCR, which is a short-term metric, the NSFR assesses a bank’s medium-term and long-term resilience. The NSFR is defined as the ratio of the amount of available stable funding (ASF) to the amount of required stable funding (RSF). ASF represents the proportion of own and third-party resources that are expected to be reliably available over a one-year horizon (including customer deposits, long-term wholesale funding, and capital). The stable funding requirements for each institution are set by OSFI based on the liquidity and maturity characteristics of its on-balance sheet assets and off-balance sheet exposures. Weightings prescribed by OSFI are applied to notional asset and liability balances to determine ASF, RSF and the NSFR. Canadian D-SIBs, including BMO, are required to maintain a minimum NSFR of 100%. BMO’s NSFR was 114% as at July 31, 2026, equivalent to a surplus of $97.4 billion above the regulatory minimum. The NSFR remained unchanged from 114% in the prior quarter, as an increase in available stable funding was largely offset by an increase in required stable funding. TABLE 34 For the quarter ended July 31, 2026 Unweighted value by residual maturity Weighted value (2)(Canadian $ in billions, except as noted) No maturity (1) Less than 6 months 6 to 12 months Over 1 year Available Stable Funding (ASF) Item Capital: 89.6 – – 7.4 97.0 Regulatory capital 89.6 – – 7.4 97.0 Other capital instruments – – – – – Retail deposits and deposits from small business customers: 250.1 51.2 27.5 49.3 347.4 Stable deposits 120.8 22.5 11.0 11.9 158.6 Less stable deposits 129.3 28.7 16.5 37.4 188.8 Wholesale funding: 356.8 321.7 79.8 124.1 325.0 Operational deposits 169.5 – – – 84.8 Other wholesale funding 187.3 321.7 79.8 124.1 240.2 Liabilities with matching interdependent assets – 1.0 1.0 13.1 – Other liabilities: 10.3 * * 114.5 47.3 NSFR derivative liabilities * * * 5.7 – All other liabilities and equity not included in the above categories 10.3 61.2 0.5 47.1 47.3 Total ASF * * * * 816.7 Required Stable Funding (RSF) Item Total NSFR high-quality liquid assets (HQLA) * * * * 19.0 Deposits held at other financial institutions for operational purposes – 0.4 – – 0.2 Performing loans and securities: 207.1 242.0 78.7 365.5 549.9 Performing loans to financial institutions secured by Level 1 HQLA – 113.3 2.6 – 3.1 Performing loans to financial institutions secured by non-Level 1 HQLA and unsecured performing loans to financial institutions 26.3 67.3 7.5 16.6 54.2 Performing loans to non-financial corporate clients, loans to retail and small business customers, and loans to sovereigns, central banks and public sector entities, of which: 134.5 40.9 41.0 172.8 303.0 With a risk weight of less than or equal to 35% under the Basel II standardized approach for credit risk – – – – – Performing residential mortgages, of which: 13.6 17.9 27.3 146.3 135.0 With a risk weight of less than or equal to 35% under the Basel II standardized approach for credit risk 13.6 17.9 27.3 146.3 135.0 Securities that are not in default and do not qualify as HQLA, including exchange-traded equities 32.7 2.6 0.3 29.8 54.6 Assets with matching interdependent liabilities – 1.0 1.0 13.1 – Other assets: 49.0 * * 149.2 127.3 Physical traded commodities, including gold 8.3 * * * 7.0 Assets posted as initial margin for derivative contracts and contributions to default funds of central clearing parties * * * 22.3 19.0 NSFR derivative assets * * * 4.4 – NSFR derivative liabilities before deduction of variation margin posted * * * 19.3 1.0 All other assets not included in the above categories 40.7 52.3 0.5 50.4 100.3 Off-balance sheet items * * * 681.5 22.9 Total RSF * * * * 719.3 Net Stable Funding Ratio (%) * * * * 114 Weighted Value (2)For the quarter ended April 30, 2026 Total ASF 794.4 Total RSF 699.2 Net Stable Funding Ratio (%) 114 * Disclosure is not required under the NSFR disclosure standard. (1) Items in the no maturity column do not have a stated maturity. These may include, but are not limited to, capital with perpetual maturity, non-maturity deposits, short positions, open maturity positions, non-HQLA equities, physical traded commodities and demand loans. (2) Weighted values are calculated after the application of the weights prescribed under the OSFI LAR Guideline for ASF and RSF. Contractual Maturities of Assets and Liabilities and Off-Balance Sheet Commitments Tables showing contractual maturities of on-balance sheet assets and liabilities and off-balance sheet commitments will be disclosed on an annual basis in the fourth quarter of each year. BMO Financial Group Third Quarter Report 2026 39
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Glossary of Financial Terms Adjusted Earnings and Measures are non- GAAP and exclude certain specified items from revenue, non-interest expense, provision for credit losses and income taxes that may not reflect ongoing business performance. Management considers both reported and adjusted results to be useful in assessing underlying ongoing performance, as set out in the Non-GAAP and Other Financial Measures section. Allowance for Credit Losses represents an amount deemed appropriate by management to absorb credit-related losses on loans and acceptances and other credit instruments, in accordance with applicable accounting standards. Allowance on Impaired Loans is maintained to reduce the carrying value of individually identified impaired loans to the expected recoverable amount. Allowance on Performing Loans is maintained to cover impairment in the existing portfolio for loans that have not yet been individually identified as impaired. Allowance on Performing Loans Ratio is calculated as the allowance for credit losses on performing loans as a percentage of gross performing loans and acceptances. Allowance for Credit Losses Ratio is calculated as the allowance for credit losses on impaired loans as a percentage of gross impaired loans and acceptances. Assets under Administration (AUA) refers to the assets administered by the bank, including assets under custody, that are beneficially owned by clients and therefore not reported on the bank’s consolidated balance sheet. BMO provides administrative services for these assets, including safekeeping, recordkeeping, income collection and distribution, and reporting. Assets under Management (AUM) refers to the total market value of assets beneficially owned by clients and managed by the bank. Services provided in respect of AUM include the provision of investment advice and discretionary portfolio management. AUM is not reported on the bank’s consolidated balance sheet. Asset-Backed Commercial Paper (ABCP) is backed by assets such as trade receivables, and is generally used for short-term financing needs. Average Earning Assets represents the daily average balance of deposits at central banks, deposits with other banks, securities borrowed or purchased under resale agreements, securities and loans over a period. Bankers’ Acceptances (BAs) are bills of exchange or negotiable instruments drawn by a borrower for payment at maturity and accepted by a bank. BAs constitute a guarantee of payment by the issuer’s bank for a fee and can be traded in the money market. Basis Point is one one-hundredth of a percentage point. Book Value per Share represents common shareholders’ equity divided by the number of common shares at the end of a period. Collateral is assets pledged as security to secure loans or other obligations. Collateralized Mortgage Obligations (CMOs) are debt securities with multiple tranches, issued by structured entities and collateralized by a pool of mortgages. Each tranche carries different terms, interest rates and risks. Common Equity Tier 1 (CET1) Capital comprises common shareholders’ equity, including applicable contractual service margin, less regulatory deductions for goodwill, intangible assets, pension assets, certain deferred tax assets and other items, which may include a portion of expected credit loss provisions or a shortfall in allowances or other specified items. Common Equity Tier 1 (CET1) Ratio is calculated as CET1 Capital divided by risk- weighted assets. The CET1 Ratio is calculated in accordance with OSFI’s Capital Adequacy Requirements (CAR) Guideline. Common Shareholders’ Equity is the most permanent form of capital. For regulatory capital purposes, common shareholders’ equity comprises common shareholders’ equity, net of capital deductions. Contractual Service Margin (CSM) represents the unearned profit of a group of insurance contracts that we expect to recognize in the income statement as services are provided. Credit Valuation Adjustment (CVA) represents fair value adjustments to capture counterparty credit risk in our derivative valuations. Derivatives are contracts, requiring no or little initial investment, with a value that is derived from movements in underlying interest or foreign exchange rates, equity or commodity prices, or other indices. Derivatives are used to transfer, modify or reduce current or expected risks from changes in rates and prices. Dividend Payout Ratio represents common share dividends as a percentage of net income available to common shareholders. It is calculated by dividing dividends per share by basic earnings per share. Dividend Yield is calculated as dividends per common share divided by the closing share price. Earnings per Share (EPS) is calculated by dividing net income available to common shareholders, after deducting preferred share dividends and distributions on other equity instruments, by the average number of common shares outstanding. Diluted EPS, which is BMO’s basis for measuring performance, adjusts for possible conversions of financial instruments into common shares if those conversions would reduce EPS. Earnings Sensitivity is a measure of the impact of potential changes in interest rates on the projected 12-month pre-tax net income from a portfolio of assets, liabilities and off-balance sheet positions in response to prescribed parallel interest rate movements, with interest rates floored at zero. Economic Capital is an expression of the enterprise’s capital demand requirement relative to its view of the economic risks in its underlying business activities. It represents management’s estimate of the likely magnitude of economic losses that could occur should severely adverse situations arise. Economic capital is calculated for various types of risk, including credit, market (trading and non-trading), operational non-financial, business and insurance, based on a one-year time horizon using a defined confidence level. Economic Value Sensitivity is a measure of the impact of potential changes in interest rates on the market value of a portfolio of assets, liabilities and off-balance sheet positions in response to prescribed parallel interest rate movements, with interest rates floored at zero. Effective Tax Rate is a percentage calculated as provision for income taxes divided by income before provision for income taxes. Efficiency Ratio (or Expense-to-Revenue Ratio) is a measure of productivity. It is a percentage calculated as non-interest expense divided by total revenue (on a taxable equivalent basis in the operating segments). Fair Value is the amount of consideration that would be agreed upon in an arm’s-length transaction between knowledgeable, willing parties, who are under no compulsion to act, in an orderly market transaction. 40 BMO Financial Group Third Quarter Report 2026
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Forwards and Futures are contractual agreements to either buy or sell a specified amount of a currency, commodity, interest- rate-sensitive financial instrument or security at a specified price and date in the future. Forwards are customized contracts transacted in the over-the-counter market. Futures are transacted in standardized amounts on regulated exchanges and are subject to daily cash margin requirements. Gross Impaired Loans and Acceptances (GIL) is calculated as the credit impaired balance of loans and customers’ liability under acceptances. Gross Impaired Loans and Acceptances (GIL) Ratio is calculated as gross impaired loans and acceptances as a percentage of gross loans and acceptances. Guarantees and Standby Letters of Credit represent our obligation to make payments to third parties on behalf of a customer if the customer is unable to make the required payments or meet other contractual requirements. Hedging is a risk management technique used to neutralize, manage or offset interest rate, foreign currency, equity, commodity or credit risk exposures arising from normal banking activities. High-Quality Liquid Assets (HQLA) are cash or assets that can be converted into cash with little or no loss in value to meet short-term liquidity needs. Impaired Loans are loans for which there is no longer a reasonable assurance of the timely collection of principal or interest. Insurance Investment Results represent net returns on insurance-related assets and the impact of the change in discount rates and financial assumptions on insurance contract liabilities. Insurance Service Results represent insurance revenue, insurance service expenses and reinsurance results. Leverage Exposures (LE) consist of on- balance sheet items and specified off-balance sheet items, net of specified adjustments. Leverage Ratio is a Basel III regulatory measure calculated as Tier 1 Capital divided by LE, in accordance with OSFI’s Capital Adequacy Requirements (CAR) Guideline. Liquidity and Funding Risk is the potential for financial loss if the bank is unable to meet its financial commitments in a timely manner at reasonable prices as they come due. Financial commitments include liabilities to depositors and suppliers, as well as lending, investment and pledging commitments. Liquidity Coverage Ratio (LCR) is a Basel III regulatory metric calculated as the ratio of high-quality liquid assets to total net stressed cash outflows over a thirty-day period under a stress scenario, in accordance with guidelines issued by OSFI. Market Risk is the potential for financial loss as a result of the impact to capital and earnings from adverse changes in market variables that may affect the bank’s trading, underwriting and banking book positions, such as interest rates, foreign exchange rates, credit spreads, equity and commodity prices and their implied volatilities. Mark-to-Market represents the valuation of financial instruments at fair value as of the balance sheet date. Master Netting Agreements are agreements between two parties designed to reduce the credit risk of multiple derivative transactions through the provision of a legal right to offset exposure in the event of default. Net Interest Income comprises earnings on assets, such as loans and securities, including interest and certain dividend income, less interest expense paid on liabilities, such as deposits. Net interest income, excluding Global Markets, is presented on a basis that excludes Global Markets net interest income. Net Interest Margin is the ratio of net interest income to average earning assets, expressed as a percentage or in basis points. Net Interest Margin, excluding Global Markets and Insurance is the ratio of net interest income, excluding net interest income from our Global Markets business in Capital Markets to average earning assets, excluding Global Markets and Insurance average earning assets, expressed as a percentage or in basis points. Net Stable Funding Ratio (NSFR) is a regulatory liquidity measure that assesses the stability of a bank’s funding profile in relation to the liquidity value of its assets, calculated in accordance with OSFI’s Liquidity Adequacy Requirements (LAR) Guideline. Notional Amount refers to the principal amount used to calculate interest and other payments under derivative contracts. The principal amount does not change hands under the terms of a derivative contract, except in the case of cross-currency swaps. Off-Balance Sheet Financial Instruments comprise a variety of financial arrangements offered to clients, including credit derivatives, written put options, backstop liquidity facilities, standby letters of credit, performance guarantees, credit enhancements, commitments to extend credit, securities lending, documentary and commercial letters of credit, and other indemnifications. Office of the Superintendent of Financial Institutions (OSFI) is the government agency responsible for regulating banks, insurance companies, trust companies, loan companies and pension plans in Canada. Operating Leverage is the difference between the growth rates of revenue and non-interest expense. Options are contractual agreements that convey to the purchaser the right but not the obligation to either buy or sell a specified amount of a currency, commodity, interest- rate-sensitive financial instrument or security at a fixed future date or at any time within a fixed future period. Pre-Provision, Pre-Tax Earnings (PPPT) is a non-GAAP measure, calculated as income before provision for income taxes and provision for (recovery of) credit losses. We use PPPT on both a reported and an adjusted basis to assess our ability to generate sustained earnings growth excluding credit losses, which are impacted by the cyclical nature of a credit cycle. Provision for Credit Losses (PCL) is a charge to income that represents an amount deemed adequate by management to provide for impairment in a portfolio of loans and acceptances and other credit instruments, given the composition of the portfolio, the probability of default, the economic outlook and the allowance for credit losses already established. PCL can comprise both a provision for credit losses on impaired loans and a provision for credit losses on performing loans. Provision for Credit Losses (PCL) Ratio is calculated as the annualized total provision for credit losses as a percentage of average net loans and acceptances. Provision for Credit Losses (PCL) Impaired Loans Ratio is calculated as the annualized total provision for credit losses on impaired loans as a percentage of average net loans and acceptances. Provision for Credit Losses (PCL) Performing Loans Ratio is calculated as the annualized provision for credit losses on performing loans as a percentage of average net loans and acceptances. Return on Assets (ROA) is calculated as net income, as a percentage of average assets. Return on Equity or Return on Common Shareholders’ Equity (ROE) is calculated as net income, less preferred dividends and distributions on other equity instruments, as a percentage of average common shareholders’ equity. Common shareholders’ equity comprises common share capital, contributed surplus, accumulated other comprehensive income (loss) and retained earnings. BMO Financial Group Third Quarter Report 2026 41
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Return on Tangible Common Equity (ROTCE) is calculated as net income available to common shareholders, adjusted for the amortization of acquisition-related intangible assets and any impairments, as a percentage of average tangible common equity. Risk-Weighted Assets (RWA) are on- and off-balance sheet exposures adjusted by a regulatory risk-weighted factor to a comparable risk level, in accordance with guidelines issued by OSFI. Securities Borrowed or Purchased under Resale Agreements are low-cost, low-risk instruments, often supported by the pledge of cash collateral, which arise from transactions that involve the borrowing or purchasing of securities. Securities Lent or Sold under Repurchase Agreements are low-cost, low-risk liabilities, often supported by cash collateral, which arise from transactions that involve the lending or selling of securities. Securitization is the practice of selling pools of contractual debts, such as residential mortgages and credit card debt obligations, to third parties or trusts, which then typically issue a series of asset-backed securities to investors to fund the purchase of the contractual debts. Structured Entities (SEs) include entities for which voting or similar rights are not the primary factor in determining control of the entity. BMO is required to consolidate a SE if it controls the entity by having power over the entity, exposure to variable returns as a result of its involvement and the ability to exercise power to affect the amount of those returns. Structural (Non-Trading) Market Risk comprises interest rate risk arising from banking activities (loans and deposits) and foreign exchange risk arising from foreign currency operations and exposures. Swaps are contractual agreements between two parties to exchange a series of cash flows based on notional amounts over a specified period. Tangible Common Equity is calculated as common shareholders’ equity, less goodwill and acquisition-related intangible assets, net of related deferred tax liabilities. Taxable Equivalent Basis (teb): Operating segment revenue is presented on a taxable equivalent basis (teb). Net interest income, total revenue and provision for income taxes in Capital Markets and U.S. Banking are increased on tax-exempt securities to an equivalent pre-tax basis to facilitate comparisons of income between taxable and tax-exempt sources, and are reflected in the key metrics. The offset to operating segment teb adjustments is reflected in Corporate Services net interest income, revenue and provision for (recovery of) income taxes. Tier 1 Capital comprises CET1 Capital and Additional Tier 1 (AT1) Capital. AT1 Capital consists of preferred shares, limited recourse capital notes, less regulatory deductions. Tier 2 Capital comprises subordinated debentures and may include certain credit loss provisions, less regulatory deductions. Total Capital comprises Tier 1 and Tier 2 Capital. Total Loss Absorbing Capacity (TLAC) comprises Total Capital and senior unsecured debt subject to the Canadian Bail-In Regime, less regulatory deductions, in accordance with guidelines issued by OSFI. Total Loss Absorbing Capacity (TLAC) Ratio is calculated as TLAC divided by risk-weighted assets. Total Loss Absorbing Capacity (TLAC) Leverage Ratio is calculated as TLAC divided by leverage exposures. Total Shareholder Return (TSR) represents the average annual total return earned on an investment in BMO common shares made at the beginning of the respective period. It includes the change in share price and assumes dividends received were reinvested in additional common shares. Trading-Related Revenue comprises net interest income and non-interest revenue earned from on-balance sheet and off-balance sheet positions undertaken for trading purposes. The management of these positions typically includes marking them to market on a daily basis. Value-at-Risk (VaR) measures the maximum loss likely to be experienced in the trading and underwriting portfolios, measured at a 99% confidence level over a one-day holding period. VaR is calculated for specific classes of risk in BMO’s trading and underwriting activities related to interest rates, foreign exchange rates, credit spreads, equity and commodity prices and their implied volatilities. 42 BMO Financial Group Third Quarter Report 2026
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Interim Consolidated Financial Statements Consolidated Statement of Income (Unaudited) (Canadian $ in millions, except as noted) For the three months ended For the nine months ended July 31, April 30, July 31, July 31, July 31, 2026 2026 2025 2026 2025 Interest, Dividend and Fee Income Loans $ 9,407 $ 8,868 $ 9,594 $ 27,518 $ 29,216 Securities (Note 2) 4,278 4,251 3,929 12,480 12,027 Securities borrowed or purchased under resale agreements 1,529 1,321 1,540 4,233 4,553 Deposits with banks 573 574 679 1,733 2,223 15,787 15,014 15,742 45,964 48,019 Interest Expense Deposits 6,211 5,938 7,008 18,397 22,400 Securities sold but not yet purchased and securities lent or sold under repurchase agreements 2,760 2,657 2,227 7,687 6,790 Subordinated debt 109 105 118 323 344 Other liabilities 1,140 1,046 893 3,079 2,494 10,220 9,746 10,246 29,486 32,028 Net Interest Income 5,567 5,268 5,496 16,478 15,991 Non-Interest Revenue Securities commissions and fees 325 323 286 964 849 Deposit and payment service charges 460 449 447 1,358 1,345 Trading revenues 850 883 406 2,599 2,027 Lending fees 358 327 327 1,025 1,013 Card fees 237 245 207 743 627 Investment management and custodial fees 741 676 589 2,095 1,719 Mutual fund revenues 463 420 376 1,304 1,092 Underwriting and advisory fees 500 504 453 1,430 1,248 Securities gains, other than trading (Note 2) 53 86 49 224 173 Foreign exchange gains, other than trading 81 86 65 243 203 Insurance service results (Note 5) 94 100 89 263 303 Insurance investment results (Notes 2 and 5) 66 51 29 193 85 Share of profit in associates and joint ventures 51 37 45 129 92 Other revenues 50 112 124 239 166 4,329 4,299 3,492 12,809 10,942 Total Revenue 9,896 9,567 8,988 29,287 26,933 Provision for Credit Losses (Note 3) 722 739 797 2,207 2,862 Non-Interest Expense Employee compensation 3,167 3,083 2,955 9,802 9,040 Premises and equipment 1,209 1,140 1,081 3,489 3,253 Amortization of intangible assets 302 296 278 892 862 Advertising and business development 269 194 198 643 582 Communications 86 85 82 252 263 Professional fees 176 152 172 496 459 Association, clearing and annual regulator fees 81 79 71 231 232 Other (Note 13) 1,388 301 268 1,956 860 6,678 5,330 5,105 17,761 15,551 Income Before Provision for Income Taxes 2,496 3,498 3,086 9,319 8,520 Provision for income taxes (Note 11) 746 868 756 2,450 2,090 Net Income $ 1,750 $ 2,630 $ 2,330 $ 6,869 $ 6,430 Attributable to: Bank shareholders $ 1,748 $ 2,626 $ 2,327 $ 6,864 $ 6,421 Non-controlling interest in subsidiaries 2 4 3 5 9 Net Income $ 1,750 $ 2,630 $ 2,330 $ 6,869 $ 6,430 Earnings Per Common Share (Canadian $) (Note 10) Basic $ 2.38 $ 3.54 $ 3.14 $ 9.33 $ 8.48 Diluted 2.38 3.53 3.14 9.30 8.47 Dividends per common share 1.71 1.67 1.63 5.05 4.81 The accompanying notes are an integral part of these interim consolidated financial statements. BMO Financial Group Third Quarter Report 2026 43
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Interim Consolidated Financial Statements Consolidated Statement of Comprehensive Income (Unaudited) (Canadian $ in millions) For the three months ended For the nine months ended July 31, April 30, July 31, July 31, July 31, 2026 2026 2025 2026 2025 Net Income $ 1,750 $ 2,630 $ 2,330 $ 6,869 $ 6,430 Other Comprehensive Income (Loss), net of taxes Items that will subsequently be reclassified to net income Net change in unrealized gains (losses) on fair value through OCI debt securities Unrealized gains (losses) on fair value through OCI debt securities arising during the period (1) 28 (61) 178 170 161 Reclassification to earnings of (gains) during the period (2) (10) (22) (11) (43) (32) 18 (83) 167 127 129 Net change in unrealized gains (losses) on derivatives designated as cash flow hedges Gains (losses) on derivatives designated as cash flow hedges arising during the period (3) (392) (798) (1,051) (1,759) 142 Reclassification to earnings of losses on derivatives designated as cash flow hedges during the period (4) 196 189 272 558 797 (196) (609) (779) (1,201) 939 Net gains (losses) on translation of net foreign operations Unrealized gains (losses) on translation of net foreign operations 2,053 (21) 282 101 (311) Unrealized gains (losses) on hedges of net foreign operations (5) (660) 8 (74) (120) 132 1,393 (13) 208 (19) (179) Items that will not be subsequently reclassified to net income Net unrealized gains (losses) on fair value through OCI equity securities arising during the period (6) (5) 39 – 31 (11) Net gains on remeasurement of pension and other employee future benefit plans (7) 157 64 55 277 49 Net gains (losses) on remeasurement of own credit risk on financial liabilities designated at fair value (8) (44) 292 (313) 6 (255) 108 395 (258) 314 (217) Total Other Comprehensive Income (Loss), net of taxes 1,323 (310) (662) (779) 672 Total Comprehensive Income $ 3,073 $ 2,320 $ 1,668 $ 6,090 $ 7,102 Attributable to: Bank shareholders $ 3,071 $ 2,316 $ 1,665 $ 6,085 $ 7,093 Non-controlling interest in subsidiaries 2 4 3 5 9 Total Comprehensive Income $ 3,073 $ 2,320 $ 1,668 $ 6,090 $ 7,102 (1) Net of income tax (provision) recovery of $(11) million, $22 million, $(66) million for the three months ended and $(62) million and $(61) million for the nine months ended, respectively. (2) Net of income tax provision of $4 million, $8 million, $3 million for the three months ended and $15 million and $11 million for the nine months ended, respectively. (3) Net of income tax (provision) recovery of $148 million, $302 million, $409 million for the three months ended and $671 million and $(41) million for the nine months ended, respectively. (4) Net of income tax (recovery) of $(74) million, $(71) million, $(102) million for the three months ended and $(212) million and $(301) million for the nine months ended, respectively. (5) Net of income tax (provision) recovery of $254 million, $(3) million, $28 million for the three months ended and $46 million and $(51) million for the nine months ended, respectively. (6) Net of income tax (provision) recovery of $nil million, $(4) million, nil million for the three months ended and $(3) million and $4 million for the nine months ended, respectively. (7) Net of income tax(provision) of $(60) million, $(25) million, $(22) million for the three months ended and $(106) million and $(19) million for the nine months ended, respectively. (8) Net of income tax (provision) recovery of $16 million, $(112) million, $118 million for the three months ended and $(3) million and $96 million for the nine months ended, respectively. The accompanying notes are an integral part of these interim consolidated financial statements. 44 BMO Financial Group Third Quarter Report 2026
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Interim Consolidated Financial Statements Consolidated Balance Sheet (Unaudited) (Canadian $ in millions) As at July 31, October 31, 2026 2025 Assets Cash and Cash Equivalents $ 74,086 $ 67,484 Interest Bearing Deposits with Banks 3,200 2,838 Securities (Note 2) Trading 204,818 192,303 Fair value through profit or loss 23,760 21,354 Fair value through other comprehensive income 137,070 113,209 Debt securities at amortized cost 92,978 96,610 458,626 423,476 Securities Borrowed or Purchased Under Resale Agreements 109,018 129,421 Loans (Note 3) Residential mortgages 196,924 196,033 Consumer instalment and other personal 94,269 92,741 Credit cards 12,041 12,649 Business and government 398,508 380,788 701,742 682,211 Allowance for credit losses (Note 3) (5,247) (5,050) 696,495 677,161 Other Assets Derivative instruments 67,997 57,151 Customers’ liability under acceptances 1,432 711 Premises and equipment 6,331 6,252 Goodwill 16,086 16,797 Intangible assets 5,158 4,758 Current tax assets 1,965 1,970 Deferred tax assets 3,162 2,732 Receivable from brokers, dealers and clients 45,928 43,167 Other 49,201 42,884 197,260 176,422 Total Assets $ 1,538,685 $ 1,476,802 Liabilities and Equity Deposits (Note 4) $ 1,017,834 $ 976,202 Other Liabilities Derivative instruments 69,597 58,729 Acceptances 1,432 711 Securities sold but not yet purchased 51,098 54,876 Securities lent or sold under repurchase agreements 124,983 134,967 Securitization and structured entities’ liabilities 62,911 51,562 Insurance-related liabilities (Note 5) 21,300 20,436 Payable to brokers, dealers and clients 50,945 45,170 Other 44,517 37,549 426,783 404,000 Subordinated Debt (Note 4) 7,495 8,500 Total Liabilities 1,452,112 1,388,702 Equity Preferred shares and other equity instruments (Note 6) 7,706 8,956 Common shares (Note 6) 23,473 23,359 Contributed surplus 403 373 Retained earnings 47,734 47,377 Accumulated other comprehensive income 7,207 7,986 Total shareholders’ equity 86,523 88,051 Non-controlling interest in subsidiaries 50 49 Total Equity 86,573 88,100 Total Liabilities and Equity $ 1,538,685 $ 1,476,802 The accompanying notes are an integral part of these interim consolidated financial statements. BMO Financial Group Third Quarter Report 2026 45
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Interim Consolidated Financial Statements Consolidated Statement of Changes in Equity (Unaudited) (Canadian $ in millions) For the three months ended For the nine months ended July 31, July 31, July 31, July 31, 2026 2025 2026 2025 Preferred Shares and Other Equity Instruments (Note 6) Balance at beginning of period $ 7,706 $ 7,787 $ 8,956 $ 8,087 Issued during the period – 1,369 – 1,369 Redeemed during the period – – (1,250) (300) Balance at end of period 7,706 9,156 7,706 9,156 Common Shares (Note 6) Balance at beginning of period 23,537 23,730 23,359 23,921 Issued under the Stock Option Plan 64 30 161 101 Treasury shares (purchased) – (8) – (1) Purchased for cancellation (128) (198) (528) (467) Issued for acquisition (Note 13) – – 481 – Balance at end of period 23,473 23,554 23,473 23,554 Contributed Surplus Balance at beginning of period 390 367 373 354 Stock option expense, net of options exercised 9 5 30 10 Net premium (discount) on sale of treasury shares 4 (4) – 4 Balance at end of period 403 368 403 368 Retained Earnings Balance at beginning of period 48,053 47,158 47,377 46,469 Net income attributable to bank shareholders 1,748 2,327 6,864 6,421 Dividends on preferred shares and distributions payable on other equity instruments (81) (66) (301) (273) Dividends on common shares (1,192) (1,165) (3,541) (3,475) Equity issue expense – (4) – (4) Common shares purchased for cancellation (Note 6) (794) (696) (2,665) (1,584) Balance at end of period 47,734 47,554 47,734 47,554 Accumulated Other Comprehensive Income (Loss) on Fair Value through OCI Securities, net of taxes Balance at beginning of period 56 (370) (89) (321) Unrealized gains on fair value through OCI debt securities arising during the period 28 178 170 161 Unrealized gains (losses) on fair value through OCI equity securities arising during the period (5) – 31 (11) Reclassification to earnings of (gains) during the period (10) (11) (43) (32) Balance at end of period 69 (203) 69 (203) Accumulated Other Comprehensive (Loss) on Cash Flow Hedges, net of taxes Balance at beginning of period (478) 199 527 (1,519) Gains (losses) on derivatives designated as cash flow hedges arising during the period (392) (1,051) (1,759) 142 Reclassification to earnings of losses on derivatives designated as cash flow hedges during the period 196 272 558 797 Balance at end of period (674) (580) (674) (580) Accumulated Other Comprehensive Income on Translation of Net Foreign Operations, net of taxes Balance at beginning of period 5,366 5,994 6,778 6,381 Unrealized gains (losses) on translation of net foreign operations 2,053 282 101 (311) Unrealized gains (losses) on hedges of net foreign operations (660) (74) (120) 132 Balance at end of period 6,759 6,202 6,759 6,202 Accumulated Other Comprehensive Income on Pension and Other Employee Future Benefit Plans, net of taxes Balance at beginning of period 1,131 868 1,011 874 Gains on remeasurement of pension and other employee future benefit plans 157 55 277 49 Balance at end of period 1,288 923 1,288 923 Accumulated Other Comprehensive (Loss) on Own Credit Risk on Financial Liabilities Designated at Fair Value, net of taxes Balance at beginning of period (191) 62 (241) 4 Gains (losses) on remeasurement of own credit risk on financial liabilities designated at fair value (44) (313) 6 (255) Balance at end of period (235) (251) (235) (251) Total Accumulated Other Comprehensive Income 7,207 6,091 7,207 6,091 Total Shareholders’ Equity 86,523 86,723 86,523 86,723 Non-Controlling Interest in Subsidiaries Balance at beginning of period 47 38 49 36 Net income attributable to non-controlling interest in subsidiaries 2 3 5 9 Dividends to non-controlling interest in subsidiaries – – (3) (3) Other 1 1 (1) – Balance at end of period 50 42 50 42 Total Equity $ 86,573 $ 86,765 $ 86,573 $ 86,765 The accompanying notes are an integral part of these interim consolidated financial statements. 46 BMO Financial Group Third Quarter Report 2026
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Interim Consolidated Financial Statements Consolidated Statement of Cash Flows (Unaudited) (Canadian $ in millions) For the three months ended For the nine months ended July 31, July 31, July 31, July 31, 2026 2025 2026 2025 Cash Flows Provided by (Used in) Operating Activities Net Income $ 1,750 $ 2,330 $ 6,869 $ 6,430 Adjustments to determine net cash flows provided by operating activities: Securities (gains), other than trading (Note 2) (53) (49) (224) (173) Depreciation of premises and equipment 253 252 752 750 Depreciation of other assets 2 3 5 10 Amortization and impairment of intangible assets 303 279 905 864 Net loss on divestitures (Note 13) 1,087 – 1,104 – Provision for credit losses (Note 3) 722 797 2,207 2,862 Deferred taxes (322) (77) (437) 159 Share of (profit) in associates and joint ventures (51) (45) (129) (92) Changes in operating assets and liabilities: Trading securities 7,728 (503) (12,332) (5,873) Derivative assets (2,248) 5,813 (1,799) 5,031 Derivative liabilities 1,771 (6,464) 2,205 (8,651) Current income taxes 183 (683) 290 (513) Accrued interest receivable and payable (474) (498) (580) (913) Insurance-related liabilities 179 (466) 864 102 Brokers, dealers and clients receivable and payable (1,425) 3,748 3,024 1,532 Other items and accruals, net 269 3,513 (2,913) 814 Deposits 33,835 (5,457) 41,544 (26,862) Loans (8,990) (929) (21,242) (2,930) Securities sold but not yet purchased (13,080) (2,155) (3,899) 16,480 Securities lent or sold under repurchase agreements (3,846) 7,349 (9,918) 16,378 Securities borrowed or purchased under resale agreements 11,079 (8,416) 20,177 (17,687) Securitization and structured entities’ liabilities (1,932) (2,548) 11,191 9,755 Net Cash Provided by (Used in) Operating Activities 26,740 (4,206) 37,664 (2,527) Cash Flows (Used in) Financing Activities Net increase (decrease) in liabilities of subsidiaries (2,049) (504) 4,768 (1,219) Proceeds from issuance of subordinated debt (Note 4) – – – 1,250 Repayment of subordinated debt (Note 4) (1,000) (1,250) (1,025) (1,250) Proceeds from issuance of preferred shares, net of issuance costs (Note 6) – 1,365 – 1,365 Redemption of preferred shares (Note 6) – – (1,250) (300) Net proceeds from issuance of common shares (Note 6) 57 27 145 91 Net sale (purchase) of treasury shares 4 (12) – 3 Common shares repurchased for cancellation (Note 6) (905) (877) (3,133) (2,013) Cash dividends and distributions paid (1,309) (1,293) (3,887) (3,800) Cash dividends paid to non-controlling interest – – (3) (3) Repayment of lease liabilities (96) (98) (275) (236) Net Cash (Used in) Financing Activities (5,298) (2,642) (4,660) (6,112) Cash Flows Provided by (Used in) Investing Activities Interest bearing deposits with banks 229 (978) (357) (546) Purchases of securities, other than trading (26,393) (12,590) (64,296) (47,965) Maturities of securities, other than trading 7,556 5,639 18,694 31,021 Proceeds from sales of securities, other than trading 6,453 8,221 21,430 21,332 Net purchases of premises and equipment and software (572) (405) (1,432) (1,230) Acquisition (Note 13) (1) – – (48) – Net Cash Provided by (Used in) Investing Activities (12,727) (113) (26,009) 2,612 Effect of Exchange Rate Changes on Cash and Cash Equivalents 1,549 186 (393) (484) Net increase (decrease) in Cash and Cash Equivalents 10,264 (6,775) 6,602 (6,511) Cash and Cash Equivalents at Beginning of Period 63,822 65,362 67,484 65,098 Cash and Cash Equivalents at End of Period (2) $ 74,086 $ 58,587 $ 74,086 $ 58,587 Supplemental Disclosure of Cash Flow Information Net cash provided by operating activities includes: Interest paid in the period (3) $ 10,530 $ 10,856 $ 29,689 $ 32,956 Income taxes paid in the period 553 1,086 1,912 2,392 Interest received in the period 15,298 15,396 44,110 46,316 Dividends received in the period 433 521 1,795 1,884 (1) This amount is net of $13 million cash and cash equivalents acquired as part of the acquisition of Burgundy Asset Management Ltd. (Burgundy) for the nine months ended July 31, 2026. (2) We are required to maintain reserves or minimum balances with certain central banks, regulatory bodies and counterparties, totalling $61 million as at July 31, 2026 ($108 million as at October 31, 2025). (3) Includes dividends paid on securities sold but not yet purchased. The accompanying notes are an integral part of these interim consolidated financial statements. Certain comparative figures have been reclassified to conform with the current period’s presentation. BMO Financial Group Third Quarter Report 2026 47
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Notes to Interim Consolidated Financial Statements July 31, 2026 (Unaudited) Note 1: Basis of Presentation Bank of Montreal (the bank or BMO) is a chartered bank under the Bank Act (Canada) and is a public company incorporated in Canada. We are a highly diversified financial services company, providing a broad range of personal and commercial banking, wealth management and investment banking products and services. The bank’s head office is at 129 rue Saint Jacques, Montreal, Quebec. Our executive offices are at 100 King Street West, 1 First Canadian Place, Toronto, Ontario. Our common shares are listed on the Toronto Stock Exchange (TSX) and the New York Stock Exchange. These condensed interim consolidated financial statements have been prepared in accordance with International Accounting Standard (IAS) 34, Interim Financial Reporting as issued by the International Accounting Standards Board (IASB) using the same accounting policies as disclosed in our annual consolidated financial statements for the year ended October 31, 2025, except as outlined below. These condensed interim consolidated financial statements should be read in conjunction with the notes to our annual consolidated financial statements for the year ended October 31, 2025. We also comply with interpretations of International Financial Reporting Standards (IFRS) by our regulator, the Office of the Superintendent of Financial Institutions (OSFI). These interim consolidated financial statements were authorized for issue by the Board of Directors on August 25, 2026. Use of Estimates and Judgments The preparation of the interim consolidated financial statements requires management to make estimates and judgments that affect the carrying amounts of certain assets and liabilities, certain amounts reported in net income and other related disclosures. The most significant assets and liabilities for which we must make estimates and judgments include the allowance for credit losses (ACL); financial instruments measured at fair value; pension and other employee future benefits; impairment of securities and investments in associates and joint ventures; income taxes and deferred tax assets; goodwill and intangible assets; insurance contract liabilities; provisions including legal proceedings and severance charges; transfers of financial assets and consolidation of structured entities. We make judgments in assessing the business model for financial assets as well as whether substantially all risks and rewards have been transferred in respect of transfers of financial assets and whether we control structured entities. If actual results were to differ from the estimates, the impact would be recorded in future periods. The economic outlook is subject to several risks that could impact the North American economy. The most immediate threat is a further escalation of the Iran war and a prolonged closure of the Strait of Hormuz, which would sharply increase energy and transportation costs. In addition, Canadian businesses face longer-term risks if the renegotiation of the United States-Mexico-Canada Agreement (USMCA) is unsuccessful, as significant tariffs could then apply to most goods exported to the U.S., potentially leading to a recession in Canada. Even under a successful renegotiation of the USMCA, some tariffs are likely to remain in place, though government measures to promote investment in energy and resource projects could provide some offsetting support to the economy. Additional risks include a potential escalation of the Russia-Ukraine war and the possibility of a destabilizing correction in equity markets amid elevated valuations. The impact on our business, results of operations, reputation, financial performance and condition, including the potential for credit, counterparty and mark-to-market losses, our credit ratings and regulatory capital and liquidity ratios, as well as the impacts to our customers and competitors, will depend on future developments, which remain uncertain. By their very nature, the estimates and judgments we make for the purposes of preparing our consolidated financial statements relate to matters that are inherently uncertain. However, we have detailed policies and internal controls in place that are intended to ensure the judgments made in estimating these amounts are well controlled and independently reviewed, and that our policies are consistently applied from period to period. We believe that our estimates of the value of our assets and liabilities are appropriate as at July 31, 2026. Allowance for Credit Losses As detailed further in Note 1 of our annual consolidated financial statements for the year ended October 31, 2025, ACL consists of allowances on impaired loans, which represent estimated losses related to impaired loans in the portfolio provided for but not yet written off, and allowances on performing loans, which is our best estimate of impairment in the existing portfolio for loans that have not yet been individually identified as impaired. The expected credit losses (ECL) model requires the recognition of credit losses generally based on 12 months of expected losses for performing loans and the recognition of lifetime losses on performing loans that have experienced a significant increase in credit risk since origination. The determination of a significant increase in credit risk takes into account many different factors and varies by product and risk segment. The bank’s methodology for determining a significant increase in credit risk is based on the change in probability of default between origination, and reporting date, assessed using probability-weighted scenarios as well as certain other criteria, such as 30 days past due and watchlist status. The assessment of a significant increase in credit risk requires experienced credit judgment. In determining whether there has been a significant increase in credit risk and in calculating the amount of ECL, we must rely on estimates and exercise judgment, based on what we know at the end of the reporting period, regarding matters for which the ultimate outcome is unknown. These judgments include changes in circumstances that may cause future assessments of credit risk to be materially different from current assessments, which could require an increase or a decrease in the ACL. The calculation of ECL includes the explicit incorporation of forecasts of future economic conditions. We have developed models incorporating specific macroeconomic variables that are relevant to each portfolio. Key economic variables for our portfolios include our primary operating markets of Canada, the United States and regional markets, where considered significant. Forecasts are developed internally by our Economics group, considering external data and our view of future economic conditions. We exercise experienced credit judgment to incorporate multiple economic forecasts, which are probability-weighted, in the determination of the final ECL. The allowance is sensitive to changes in both economic forecasts and the probability weight assigned to each forecast scenario. Additional information regarding the ACL is included in Note 3. 48 BMO Financial Group Third Quarter Report 2026
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Note 2: Securities Classification of Securities The following table summarizes the carrying amounts of the bank’s securities by classification: (Canadian $ in millions) July 31, 2026 October 31, 2025 Trading securities (1) $ 204,818 $ 192,303 Fair value through profit or loss securities (FVTPL) FVTPL securities mandatorily measured at fair value 8,425 7,818 FVTPL investment securities held by Insurance subsidiaries designated at fair value 15,335 13,536 Total FVTPL securities 23,760 21,354 Fair value through other comprehensive income (FVOCI) securities (2) 137,070 113,209 Amortized cost securities (3) 92,978 96,610 Total $ 458,626 $ 423,476 (1) Trading securities include interests of $44,346 million as at July 31, 2026 ($32,048 million as at October 31, 2025) in Collateralized Mortgage Obligations (CMO). We receive CMO in return for our sales of Mortgage Backed Securities (MBS) to certain structured vehicles that we do not consolidate. When we subsequently sell these CMO to third parties, but do not transfer substantially all risks and rewards of ownership to the third-party investor, or we maintain an interest in the sold instrument, we retain these CMO on our Consolidated Balance Sheet. Refer to Note 6 of our annual consolidated financial statements for the year ended October 31, 2025 for further discussion on these vehicles. (2) As these securities are presented at fair value on the Balance Sheet, ACL of $6 million ($6 million as at October 31, 2025) is included in Accumulated Other Comprehensive Income. (3) Amounts are net of ACL of $3 million ($4 million as at October 31, 2025). Amortized Cost Securities The following table summarizes the carrying value and fair value of amortized cost debt securities: (Canadian $ in millions) July 31, 2026 October 31, 2025 Carrying value Fair value Carrying value Fair value Issued or guaranteed by: Canadian federal government $ 450 $ 451 $ 949 $ 943 Canadian provincial and municipal governments 7,042 7,116 6,182 6,220 U.S. federal government 42,142 39,739 43,468 40,432 U.S. states, municipalities and agencies 150 148 165 167 Other governments 463 463 525 523 NHA MBS, U.S. agency MBS and CMO (1) 36,157 32,679 37,770 34,838 Corporate debt 6,574 6,318 7,551 7,325 Total $ 92,978 $ 86,914 $ 96,610 $ 90,448 (1) These amounts are either supported by insured mortgages or issued by U.S. agencies and government-sponsored enterprises. NHA refers to the National Housing Act. The carrying value of securities that are part of fair value hedging relationships are adjusted for related gains (losses) on hedge contracts. Unrealized Gains and Losses on FVOCI Securities The following table summarizes the unrealized gains and losses on FVOCI securities: (Canadian $ in millions) July 31, 2026 October 31, 2025 Cost or Gross Gross Cost or Gross Gross amortized unrealized unrealized amortized unrealized unrealized cost gains losses Fair value cost gains losses Fair value Issued or guaranteed by: Canadian federal government $ 59,191 $ 123 $ (121) $ 59,193 $ 44,894 $ 443 $ (2) $ 45,335 Canadian provincial and municipal governments 7,615 50 (53) 7,612 5,525 132 (13) 5,644 U.S. federal government 27,407 28 (378) 27,057 20,515 327 (33) 20,809 U.S. states, municipalities and agencies 5,009 21 (91) 4,939 5,622 77 (65) 5,634 Other governments 4,317 8 (31) 4,294 4,039 35 (9) 4,065 NHA MBS, U.S. agency MBS and CMO 29,325 75 (357) 29,043 26,946 291 (222) 27,015 Corporate debt 4,747 12 (20) 4,739 4,491 37 (13) 4,515 Corporate equity 167 26 – 193 165 27 – 192 Total $ 137,778 $ 343 $ (1,051) $ 137,070 $ 112,197 $ 1,369 $ (357) $ 113,209 Unrealized gains (losses) may be offset by related (losses) gains on hedge contracts. Interest Income on Debt Securities The following table presents interest income calculated using the effective interest method: (Canadian $ in millions) For the three months ended For the nine months ended July 31, 2026 July 31, 2025 July 31, 2026 July 31, 2025 FVOCI securities $ 1,144 $ 1,128 $ 3,243 $ 3,304 Amortized cost securities 523 624 1,531 2,090 Total $ 1,667 $ 1,752 $ 4,774 $ 5,394 BMO Financial Group Third Quarter Report 2026 49
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Non-Interest Revenue Net gains and losses from securities, excluding gains and losses on trading securities, have been included in our Consolidated Statement of Income as follows: (Canadian $ in millions) For the three months ended For the nine months ended July 31, 2026 July 31, 2025 July 31, 2026 July 31, 2025 FVTPL securities $ 35 $ 36 $ 163 $ 132 FVOCI securities - net realized gains (1) 14 13 60 42 Impairment (loss) recovery on FVOCI and amortized cost securities 4 – 1 (1) Securities gains, other than trading $ 53 $ 49 $ 224 $ 173 (1) Gains are net of (losses) on hedge contracts. Interest and dividend income and gains on securities held in our Insurance business are recorded as a component of non-interest revenue, insurance investment results, in our Consolidated Statement of Income as follows: (Canadian $ in millions) For the three months ended For the nine months ended July 31, 2026 July 31, 2025 July 31, 2026 July 31, 2025 Interest and dividend income $ 153 $ 137 $ 449 $ 406 Gains (losses) from securities designated at FVTPL (1) (131) 29 (524) 6 Realized gains (losses) from FVOCI securities – – (2) 2 Total interest and dividend income and gains held in our Insurance business $ 22 $ 166 $ (77) $ 414 (1) Gains (losses) on these securities may be offset by certain (losses) gains from changes in insurance-related liabilities. Note 3: Loans and Allowance for Credit Losses Allowance for Credit Losses The ACL recorded in our Consolidated Balance Sheet is maintained at a level we consider adequate to absorb credit-related losses on our loans and other credit instruments. The ACL amounted to $6,030 million as at July 31, 2026 ($5,739 million as at October 31, 2025) of which $5,247 million ($5,050 million as at October 31, 2025) was recorded in loans and $783 million ($689 million as at October 31, 2025) was recorded in other liabilities in our Consolidated Balance Sheet. Changes in gross balances, including originations, maturities, sales, write-offs and repayments in the normal course of operations, impact the ACL. The following tables show the continuity in the loss allowance by product type for the three and nine months ended July 31, 2026 and July 31, 2025. Transfers represent the amount of ECL that moved between stages during the period, for example, moving from a 12-month (Stage 1) to lifetime (Stage 2) ECL measurement basis. Net remeasurements represent the ECL impact due to transfers between stages, as well as changes in economic forecasts and credit quality. Model changes include the ECL impact of new calculation models or methodologies which may impact the need for previously established experienced credit judgments. 50 BMO Financial Group Third Quarter Report 2026
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(Canadian $ in millions) For the three months ended July 31, 2026 July 31, 2025 Stage 1 Stage 2 Stage 3 (1) Total Stage 1 Stage 2 Stage 3 (1) Total Loans: Residential mortgages Balance as at beginning of period $ 49 $ 150 $ 22 $ 221 $ 67 $ 194 $ 18 $ 279 Transfer to Stage 1 8 (8) – – 36 (35) (1) – Transfer to Stage 2 (2) 13 (11) – (2) 11 (9) – Transfer to Stage 3 – (12) 12 – – (16) 16 – Net remeasurement of loss allowance (9) 7 33 31 (52) (9) 8 (53) Loan originations 5 – – 5 8 – – 8 Derecognitions and maturities (3) (4) – (7) (2) (5) – (7) Model changes (2) – – – – 23 24 – 47 Total PCL (3) (1) (4) 34 29 11 (30) 14 (5) Write-offs (4) – – (4) (4) – – (2) (2) Recoveries of previous write-offs – – 1 1 – – 2 2 Foreign exchange and other – 1 (18) (17) 1 1 (23) (21) Balance as at end of period $ 48 $ 147 $ 35 $ 230 $ 79 $ 165 $ 9 $ 253 Loans: Consumer instalment and other personal Balance as at beginning of period $ 204 $ 601 $ 162 $ 967 $ 183 $ 545 $ 179 $ 907 Transfer to Stage 1 86 (82) (4) – 85 (79) (6) – Transfer to Stage 2 (13) 23 (10) – (14) 28 (14) – Transfer to Stage 3 (2) (50) 52 – (1) (45) 46 – Net remeasurement of loss allowance (78) 99 96 117 (90) 55 121 86 Loan originations 8 – – 8 8 – – 8 Derecognitions and maturities (5) (11) – (16) (6) (10) – (16) Model changes (2) – – – – 13 47 – 60 Total PCL (3) (4) (21) 134 109 (5) (4) 147 138 Write-offs (4) – – (169) (169) – – (181) (181) Recoveries of previous write-offs – – 42 42 – – 43 43 Foreign exchange and other 3 4 (13) (6) – – (23) (23) Balance as at end of period $ 203 $ 584 $ 156 $ 943 $ 178 $ 541 $ 165 $ 884 Loans: Credit cards Balance as at beginning of period $ 217 $ 570 $ – $ 787 $ 217 $ 508 $ – $ 725 Transfer to Stage 1 68 (67) (1) – 61 (61) – – Transfer to Stage 2 (16) 16 – – (22) 22 – – Transfer to Stage 3 (2) (136) 138 – (2) (116) 118 – Net remeasurement of loss allowance (41) 215 36 210 (37) 203 81 247 Loan originations 12 – – 12 11 – – 11 Derecognitions and maturities (3) (10) – (13) (4) (20) – (24) Model changes (2) – – – – – – – – Total PCL (3) 18 18 173 209 7 28 199 234 Write-offs (4) – – (203) (203) – – (234) (234) Recoveries of previous write-offs – – 49 49 – – 55 55 Foreign exchange and other 1 1 (19) (17) (1) – (20) (21) Balance as at end of period $ 236 $ 589 $ – $ 825 $ 223 $ 536 $ – $ 759 Loans: Business and government Balance as at beginning of period $ 908 $ 1,938 $ 977 $ 3,823 $ 902 $ 2,022 $ 781 $ 3,705 Transfer to Stage 1 111 (107) (4) – 154 (139) (15) – Transfer to Stage 2 (35) 43 (8) – (37) 41 (4) – Transfer to Stage 3 (2) (54) 56 – (2) (71) 73 – Net remeasurement of loss allowance (104) 197 323 416 (148) 283 359 494 Loan originations 107 – – 107 73 – – 73 Derecognitions and maturities (34) (110) – (144) (39) (96) – (135) Model changes (2) – – – – – – – – Total PCL (3) 43 (31) 367 379 1 18 413 432 Write-offs (4) – – (307) (307) – – (259) (259) Recoveries of previous write-offs – – 81 81 – – 80 80 Foreign exchange and other 36 61 (41) 56 (2) 20 (86) (68) Balance as at end of period $ 987 $ 1,968 $ 1,077 $ 4,032 $ 901 $ 2,060 $ 929 $ 3,890 Total as at end of period $ 1,474 $ 3,288 $ 1,268 $ 6,030 $ 1,381 $ 3,302 $ 1,103 $ 5,786 Comprising: Loans $ 1,139 $ 2,898 $ 1,210 $ 5,247 $ 1,130 $ 2,980 $ 1,055 $ 5,165 Other credit instruments (5) 335 390 58 783 251 322 48 621 (1) Includes changes in the allowance for purchased credit impaired (PCI) loans. (2) Represents the impact of IFRS 9 model enhancements, which reduced the need for previously established experienced credit judgement overlays. (3) Excludes PCL on other assets of $(4) million for the three months ended July 31, 2026 ($(2) million for the three months ended July 31, 2025). (4) Generally, we continue to seek recovery on amounts that were written off during the year, unless the loan is sold, we no longer have the right to collect or we have exhausted all reasonable efforts to collect. (5) Other credit instruments, including off-balance sheet items, are recorded in other liabilities in our Consolidated Balance Sheet. BMO Financial Group Third Quarter Report 2026 51
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(Canadian $ in millions) For the nine months ended July 31, 2026 July 31, 2025 Stage 1 Stage 2 Stage 3 (1) Total Stage 1 Stage 2 Stage 3 (1) Total Loans: Residential mortgages Balance as at beginning of period $ 56 $ 179 $ 12 $ 247 $ 56 $ 186 $ 19 $ 261 Transfer to Stage 1 92 (91) (1) – 118 (116) (2) – Transfer to Stage 2 (9) 53 (44) – (7) 25 (18) – Transfer to Stage 3 – (42) 42 – – (34) 34 – Net remeasurement of loss allowance (31) 52 80 101 (126) 92 26 (8) Loan originations 11 – – 11 18 – – 18 Derecognitions and maturities (6) (15) – (21) (3) (12) – (15) Model changes (2) (64) 12 – (52) 23 24 – 47 Total PCL (3) (7) (31) 77 39 23 (21) 40 42 Write-offs (4) – – (10) (10) – – (7) (7) Recoveries of previous write-offs – – 6 6 – – 6 6 Foreign exchange and other (1) (1) (50) (52) – – (49) (49) Balance as at end of period $ 48 $ 147 $ 35 $ 230 $ 79 $ 165 $ 9 $ 253 Loans: Consumer instalment and other personal Balance as at beginning of period $ 200 $ 555 $ 160 $ 915 $ 197 $ 471 $ 175 $ 843 Transfer to Stage 1 249 (238) (11) – 232 (216) (16) – Transfer to Stage 2 (45) 76 (31) – (42) 81 (39) – Transfer to Stage 3 (6) (144) 150 – (5) (130) 135 – Net remeasurement of loss allowance (196) 364 351 519 (225) 319 367 461 Loan originations 25 – – 25 24 – – 24 Derecognitions and maturities (13) (31) – (44) (15) (29) – (44) Model changes (2) (11) 2 – (9) 13 47 – 60 Total PCL (3) 3 29 459 491 (18) 72 447 501 Write-offs (4) – – (536) (536) – – (519) (519) Recoveries of previous write-offs – – 116 116 – – 115 115 Foreign exchange and other – – (43) (43) (1) (2) (53) (56) Balance as at end of period $ 203 $ 584 $ 156 $ 943 $ 178 $ 541 $ 165 $ 884 Loans: Credit cards Balance as at beginning of period $ 188 $ 603 $ – $ 791 $ 233 $ 472 $ – $ 705 Transfer to Stage 1 271 (270) (1) – 185 (185) – – Transfer to Stage 2 (51) 52 (1) – (68) 68 – – Transfer to Stage 3 (5) (383) 388 – (6) (335) 341 – Net remeasurement of loss allowance (186) 620 169 603 (152) 567 241 656 Loan originations 31 – – 31 44 – – 44 Derecognitions and maturities (9) (33) – (42) (10) (39) – (49) Model changes (2) (4) – – (4) – – – – Total PCL (3) 47 (14) 555 588 (7) 76 582 651 Write-offs (4) – – (630) (630) – – (687) (687) Recoveries of previous write-offs – – 135 135 – – 164 164 Foreign exchange and other 1 – (60) (59) (3) (12) (59) (74) Balance as at end of period $ 236 $ 589 $ – $ 825 $ 223 $ 536 $ – $ 759 Loans: Business and government Balance as at beginning of period $ 931 $ 1,997 $ 858 $ 3,786 $ 892 $ 1,698 $ 537 $ 3,127 Transfer to Stage 1 435 (423) (12) – 406 (370) (36) – Transfer to Stage 2 (193) 285 (92) – (207) 279 (72) – Transfer to Stage 3 (5) (221) 226 – (6) (291) 297 – Net remeasurement of loss allowance (363) 186 968 791 (291) 989 1,139 1,837 Loan originations 264 – – 264 219 – – 219 Derecognitions and maturities (101) (343) – (444) (107) (280) – (387) Model changes (2) 10 468 – 478 – – – – Total PCL (3) 47 (48) 1,090 1,089 14 327 1,328 1,669 Write-offs (4) – – (887) (887) – – (883) (883) Recoveries of previous write-offs – – 192 192 – – 234 234 Foreign exchange and other 9 19 (176) (148) (5) 35 (287) (257) Balance as at end of period $ 987 $ 1,968 $ 1,077 $ 4,032 $ 901 $ 2,060 $ 929 $ 3,890 Total as at end of period $ 1,474 $ 3,288 $ 1,268 $ 6,030 $ 1,381 $ 3,302 $ 1,103 $ 5,786 Comprising: Loans $ 1,139 $ 2,898 $ 1,210 $ 5,247 $ 1,130 $ 2,980 $ 1,055 $ 5,165 Other credit instruments (5) 335 390 58 783 251 322 48 621 (1) Includes changes in the allowance for PCI loans. (2) Represents the impact of IFRS 9 model enhancements, which reduced the need for previously established experienced credit judgement overlays. (3) Excludes PCL on other assets of $nil million for the nine months ended July 31, 2026 ($(1) million for the nine months ended July 31, 2025). (4) Generally, we continue to seek recovery on amounts that were written off during the year, unless the loan is sold, we no longer have the right to collect or we have exhausted all reasonable efforts to collect. (5) Other credit instruments, including off-balance sheet items, are recorded in other liabilities in our Consolidated Balance Sheet. 52 BMO Financial Group Third Quarter Report 2026
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Credit Risk Exposure The following table sets out our credit risk exposure for all loans carried at amortized cost, FVOCI or FVTPL as at July 31, 2026 and October 31, 2025. Stage 1 represents performing loans carried with up to a 12-month ECL, Stage 2 represents performing loans carried with a lifetime ECL, and Stage 3 represents loans with a lifetime ECL that are credit impaired. (Canadian $ in millions) For the three months ended July 31, 2026 October 31, 2025 Stage 1 Stage 2 Stage 3 (1) Total Stage 1 Stage 2 Stage 3 (1) Total Loans: Residential mortgages (2) Exceptionally low $ – $ – $ – $ – $ 1 $ – $ – $ 1 Very low 116,655 684 – 117,339 110,299 844 – 111,143 Low 44,788 5,769 – 50,557 50,148 3,051 – 53,199 Medium 6,377 5,020 – 11,397 7,048 6,713 – 13,761 High 287 3,392 – 3,679 240 3,032 – 3,272 Not rated (3) 12,272 545 – 12,817 12,802 952 – 13,754 Impaired – – 1,135 1,135 – – 903 903 Gross residential mortgages 180,379 15,410 1,135 196,924 180,538 14,592 903 196,033 ACL 48 147 35 230 56 178 12 246 Carrying amount 180,331 15,263 1,100 196,694 180,482 14,414 891 195,787 Loans: Consumer instalment and other personal Exceptionally low 10,523 16 – 10,539 9,984 1 – 9,985 Very low 40,307 1,049 – 41,356 21,962 35 – 21,997 Low 7,390 1,840 – 9,230 26,238 2,682 – 28,920 Medium 6,530 6,543 – 13,073 6,991 5,566 – 12,557 High 660 2,450 – 3,110 670 2,164 – 2,834 Not rated (3) 15,022 1,325 – 16,347 14,812 1,009 – 15,821 Impaired – – 614 614 – – 627 627 Gross consumer instalment and other personal 80,432 13,223 614 94,269 80,657 11,457 627 92,741 ACL 183 552 156 891 182 532 160 874 Carrying amount 80,249 12,671 458 93,378 80,475 10,925 467 91,867 Loans: Credit cards (4) Exceptionally low 1,683 – – 1,683 1,643 – – 1,643 Very low 2,091 15 – 2,106 2,129 4 – 2,133 Low 1,786 61 – 1,847 1,846 80 – 1,926 Medium 3,382 802 – 4,184 3,550 1,191 – 4,741 High 867 979 – 1,846 592 1,232 – 1,824 Not rated (3) 286 89 – 375 260 122 – 382 Impaired – – – – – – – – Gross credit cards 10,095 1,946 – 12,041 10,020 2,629 – 12,649 ACL 158 524 – 682 125 527 – 652 Carrying amount 9,937 1,422 – 11,359 9,895 2,102 – 11,997 Loans: Business and government (2) (5) Acceptable Investment grade 209,777 5,315 – 215,092 188,707 3,873 – 192,580 Sub-investment grade 132,650 29,375 – 162,025 139,069 22,700 – 161,769 Watchlist 109 17,660 – 17,769 123 21,466 – 21,589 Impaired – – 5,054 5,054 – – 5,561 5,561 Gross business and government 342,536 52,350 5,054 399,940 327,899 48,039 5,561 381,499 ACL 750 1,675 1,019 3,444 756 1,720 802 3,278 Carrying amount 341,786 50,675 4,035 396,496 327,143 46,319 4,759 378,221 Total gross loans and acceptances 613,442 82,929 6,803 703,174 599,114 76,717 7,091 682,922 Total net loans and acceptances 612,303 80,031 5,593 697,927 597,995 73,760 6,117 677,872 Commitments and financial guarantee contracts Acceptable Investment grade 220,375 6,380 – 226,755 202,913 1,544 – 204,457 Sub-investment grade 61,727 20,550 – 82,277 65,393 13,733 – 79,126 Watchlist – 7,837 – 7,837 6 9,086 – 9,092 Impaired – – 1,704 1,704 – – 1,660 1,660 Gross commitments and financial guarantee contracts 282,102 34,767 1,704 318,573 268,312 24,363 1,660 294,335 ACL 335 390 58 783 256 377 56 689 Carrying amount (6) (7) $ 281,767 $ 34,377 $ 1,646 $ 317,790 $ 268,056 $ 23,986 $ 1,604 $ 293,646 (1) Includes PCI loans. (2) Includes $67 million ($79 million as at October 31, 2025) of residential mortgages and $12,649 million ($13,231 million as at October 31, 2025) of business and government loans that are classified and measured at FVTPL, and not subject to ECL. (3) Includes purchased portfolios and certain cases where an internal risk rating is not assigned. Alternative credit risk assessments, rating methodologies, policies and tools are used to manage credit risk for these portfolios. (4) Credit card loans are immediately written off when principal or interest payments are 180 days past due, and as a result are not reported as impaired in Stage 3. (5) Includes customers’ liability under acceptances. (6) Represents the total contractual amounts of undrawn credit facilities and other off-balance sheet exposures, excluding personal lines of credit and credit cards, which are unconditionally cancellable at our discretion. (7) Certain commercial borrower commitments are conditional and may include recourse to counterparties. BMO Financial Group Third Quarter Report 2026 53
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Loans Past Due Not Impaired Loans that are past due but not classified as impaired are loans where our customers have failed to make payments when contractually due but for which we expect the full amount of principal and interest payments to be collected. The following table presents loans that are past due but not classified as impaired as at July 31, 2026 and October 31, 2025. Loans for which payment is less than 30 days past due are excluded as they are not generally representative of the borrower’s ability to meet their payment obligations. (Canadian $ in millions) July 31, 2026 October 31, 2025 30 to 89 days 90 days or more (1) Total 30 to 89 days 90 days or more (1) Total Residential mortgages $ 846 $ 8 $ 854 $ 854 $ 7 $ 861 Credit cards, consumer instalment and other personal 712 156 868 661 171 832 Business and government 561 10 571 616 8 624 Total $ 2,119 $ 174 $ 2,293 $ 2,131 $ 186 $ 2,317 (1) Fully secured loans with amounts over 90 days past due that we have not classified as impaired totalled $8 million as at July 31, 2026 ($7 million as at October 31, 2025). ECL Sensitivity and Key Economic Variables The ECL model requires the recognition of credit losses generally based on 12 months of expected losses for performing loans and the recognition of lifetime losses on performing loans that have experienced a significant increase in credit risk since origination. The allowance for performing loans is sensitive to changes in both economic forecasts and the probability weight assigned to each forecast scenario. Many of the factors have a high degree of interdependency, although there is no single factor to which loan loss allowances as a whole are sensitive. The upside scenario as at July 31, 2026 assumes a stronger economic environment than the base case forecast, with lower unemployment rates. As at July 31, 2026, our base case scenario depicts a moderate economic expansion over the medium term as trade policy and geopolitical uncertainty diminishes. Our base case forecast as at October 31, 2025 broadly depicted a weaker economic environment. If we assumed a 100% weight on the base case forecast and included the impact of loan migration by restaging, with other assumptions held constant, including the application of experienced credit judgment, the allowance on performing loans would be approximately $3,325 million as at July 31, 2026 ($3,125 million as at October 31, 2025), compared to the reported allowance for performing loans of $4,762 million ($4,709 million as at October 31, 2025). As at July 31, 2026, our downside scenario involves a sharp contraction in the Canadian and U.S. economies in the near term, followed by a relatively slow recovery. Our severe downside scenario depicts an even deeper contraction in the Canadian and U.S. economies than in the downside scenario. The severe downside scenario as at October 31, 2025 broadly depicted a similar economic environment over the projection period. If we assumed a 100% weight on the severe downside forecast and included the impact of loan migration by restaging, with other assumptions held constant, including the application of experienced credit judgment, the allowance on performing loans would be approximately $8,350 million as at July 31, 2026 ($7,975 million as at October 31, 2025), compared to the reported allowance for performing loans of $4,762 million ($4,709 million as at October 31, 2025). Actual results will differ as our portfolio will change through time due to migration, growth, changes in geopolitical risks, risk mitigation actions and other factors. In addition, our allowance will reflect the four economic scenarios used in assessing the allowance, with often unequal weightings attached to each scenario, which can change through time. The following tables show the key economic variables used to estimate the allowance for performing loans forecast over the next 12 months or lifetime measurement period. The variables as at July 31, 2026 include the impact of tariffs, trade policy uncertainty, and higher oil prices arising from the Iran conflict on the economic outlook. While the values disclosed below are national variables, we use regional variables in the underlying models and consider factors impacting particular industries where appropriate. As at July 31, 2026 Scenarios All figures are average annual values Upside Base Downside Severe downside First 12 Remaining First 12 Remaining First 12 Remaining First 12 Remaining months horizon (1) months horizon (1) months horizon (1) months horizon (1) Real GDP growth rates (2) Canada 4.2% 2.9% 1.4% 2.0% (2.8)% 1.5% (4.1)% 1.2% United States 4.2% 2.4% 1.9% 1.9% (2.4)% 1.4% (3.6)% 1.3% Corporate BBB 10-year spread Canada 1.3% 1.8% 1.9% 2.0% 3.6% 3.0% 4.2% 3.5% United States 1.0% 1.5% 1.7% 1.9% 3.7% 3.0% 4.6% 3.6% Unemployment rates Canada 5.4% 4.9% 6.5% 6.1% 9.2% 9.4% 9.9% 10.4% United States 3.8% 3.4% 4.3% 4.2% 6.9% 7.5% 7.8% 8.7% Housing Price Index (2) Canada (3) 3.4% 6.0% (1.7)% 3.5% (10.8)% (0.2)% (20.0)% (5.0)% United States (4) 5.5% 4.0% 2.4% 2.5% (2.2)% (11.0)% (4.8)% (17.7)% (1) The remaining forecast period is two years. (2) Real gross domestic product (GDP) and housing price index are averages of quarterly year-over-year growth rates. (3) In Canada, we use the Housing Price Index Benchmark Composite. (4) In the United States, we use the National Case-Shiller House Price Index. 54 BMO Financial Group Third Quarter Report 2026
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As at October 31, 2025 Scenarios All figures are average annual values Upside Base Downside Severe downside First 12 Remaining First 12 Remaining First 12 Remaining First 12 Remaining months horizon (1) months horizon (1) months horizon (1) months horizon (1) Real GDP growth rates (2) Canada 3.6% 2.8% 1.1% 2.1% (2.7)% 1.6% (4.0)% 1.2% United States 4.5% 2.4% 1.7% 1.8% (2.3)% 1.4% (3.5)% 1.3% Corporate BBB 10-year spread Canada 1.2% 1.8% 1.7% 2.0% 3.4% 3.0% 4.2% 3.5% United States 0.8% 1.5% 1.5% 1.9% 3.5% 3.0% 4.6% 3.6% Unemployment rates Canada 6.0% 5.5% 7.1% 6.4% 9.4% 9.6% 9.9% 10.5% United States 3.6% 3.1% 4.5% 4.4% 6.8% 7.5% 7.5% 8.4% Housing Price Index (2) Canada (3) 3.9% 5.8% (0.4)% 3.4% (10.5)% (0.7)% (19.4)% (5.0)% United States (4) 3.7% 3.9% 0.7% 2.4% (11.6)% (1.1)% (20.0)% (4.3)% (1) The remaining forecast period is two years. (2) Real gross domestic product (GDP) and housing price index are averages of quarterly year-over-year growth rates. (3) In Canada, we use the Housing Price Index Benchmark Composite. (4) In the United States, we use the National Case-Shiller House Price Index. The ECL approach requires the recognition of credit losses generally based on 12 months of expected losses for performing loans (Stage 1) and the recognition of lifetime expected losses for performing loans that have experienced a significant increase in credit risk since origination (Stage 2). Under our current probability-weighted scenarios, if all of our performing loans were in Stage 1, our models would generate an allowance for performing loans of approximately $3,625 million ($3,375 million as at October 31, 2025), compared to the reported allowance for performing loans of $4,762 million ($4,709 million as at October 31, 2025). Note 4: Deposits and Subordinated Debt Deposits Payable on demand Non-interest Payable Payable on a (Canadian $ in millions) Interest bearing bearing after notice (1) fixed date (2) (3) July 31, 2026 October 31, 2025 Amortized cost deposits by: Banks (4) $ 4,313 $ 1,924 $ 1,316 $ 27,309 $ 34,862 $ 27,621 Business and government (5) 82,965 44,683 229,298 265,379 622,325 585,497 Individuals (5) 4,073 39,414 156,479 96,002 295,968 306,922 Total amortized cost deposits 91,351 86,021 387,093 388,690 953,155 920,040 Deposits at FVTPL – – – 64,679 64,679 56,162 Total (6) $ 91,351 $ 86,021 $ 387,093 $ 453,369 $ 1,017,834 $ 976,202 Booked in: Canada $ 75,730 $ 73,850 $ 176,883 $ 315,587 $ 642,050 $ 620,858 United States 15,514 12,171 206,070 77,626 311,381 305,472 Other countries 107 – 4,140 60,156 64,403 49,872 Total $ 91,351 $ 86,021 $ 387,093 $ 453,369 $ 1,017,834 $ 976,202 (1) Includes $45,438 million of non-interest bearing deposits as at July 31, 2026 ($43,766 million as at October 31, 2025). (2) Includes $73,838 million of senior unsecured debt as at July 31, 2026 subject to the Bank Recapitalization (Bail-In) regime ($62,843 million as at October 31, 2025). The Bail-In regime provides certain statutory powers to the Canada Deposit Insurance Corporation, including the ability to convert specified eligible shares and liabilities into common shares if the bank becomes non-viable. (3) Deposits totalling $26,570 million as at July 31, 2026 ($27,819 million as at October 31, 2025) can be redeemed early, either fully or partially, by customers without penalty. These are classified as payable on a fixed date, based on their remaining contractual maturities. (4) Includes regulated and central banks. (5) The carrying value of deposits that are part of fair value hedging relationships are adjusted for related gains (losses) on hedge contracts. (6) Includes $535,463 million of deposits denominated in U.S. dollars as at July 31, 2026 ($508,058 million as at October 31, 2025), and $69,542 million of deposits denominated in other foreign currencies ($59,697 million as at October 31, 2025). The following table presents deposits payable on a fixed date and greater than one hundred thousand dollars: (Canadian $ in millions) Canada United States Other Total As at July 31, 2026 $ 273,963 $ 70,995 $ 60,156 $ 405,114 As at October 31, 2025 259,670 69,206 47,386 376,262 The following table presents the maturity schedule for deposits payable on a fixed date greater than one hundred thousand dollars, which are booked in Canada: (Canadian $ in millions) Less than 3 months 3 to 6 months 6 to 12 months Over 12 months Total As at July 31, 2026 $ 51,867 $ 37,203 $ 53,520 $ 131,373 $ 273,963 As at October 31, 2025 51,591 32,105 56,129 119,845 259,670 BMO Financial Group Third Quarter Report 2026 55
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Subordinated Debt On July 22, 2026, we redeemed all of our $1,000 million 1.928% Series K Medium-Term Notes (NVCC) First Tranche, at a redemption price of 100% of the principal amount plus accrued and unpaid interest to, but excluding, the redemption date. On December 15, 2025, $25 million of the $150 million Subordinated Debentures Series 20 matured. $25 million will mature on December 15 every three years starting 2025 with the final maturity in 2040. Note 5: Insurance Insurance Results Insurance service results in our Consolidated Statement of Income are as follows: (Canadian $ in millions) For the three months ended For the nine months ended July 31, 2026 July 31, 2025 July 31, 2026 July 31, 2025 Insurance revenue $ 422 $ 486 $ 1,230 $ 1,430 Insurance service expense (318) (399) (951) (1,089) Net income (expense) from reinsurance contracts (10) 2 (16) (38) Insurance service results $ 94 $ 89 $ 263 $ 303 Insurance investment results in our Consolidated Statement of Income are as follows: (Canadian $ in millions) For the three months ended For the nine months ended July 31, 2026 July 31, 2025 July 31, 2026 July 31, 2025 Investment return $ 111 $ 132 $ 106 $ 433 Insurance finance income (expense) from insurance and reinsurance contracts held (40) (120) 83 (332) Movement in investment contract liabilities (5) 17 4 (16) Insurance investment results $ 66 $ 29 $ 193 $ 85 Insurance Contract Liabilities Insurance contract liabilities by remaining coverage and incurred claims comprise the following: (Canadian $ in millions) For the three months ended July 31, 2026 For the three months ended July 31, 2025 Liabilities for Liabilities for Liabilities for Liabilities for remaining coverage incurred claims Total remaining coverage incurred claims Total Insurance contract liabilities, beginning of period $ 19,388 $ 165 $ 19,553 $ 17,629 $ 187 $ 17,816 Insurance service results (325) 256 (69) (632) 565 (67) Net finance expense from insurance contracts 54 – 54 138 – 138 Total cash flows 413 (253) 160 807 (563) 244 Other changes in the net carrying amount of the insurance contract (1) 5 (5) – (785) (12) (797) Insurance contract liabilities, end of period (2) $ 19,535 $ 163 $ 19,698 $ 17,157 $ 177 $ 17,334 (Canadian $ in millions) For the nine months ended July 31, 2026 For the nine months ended July 31, 2025 Liabilities for Liabilities for Liabilities for Liabilities for remaining coverage incurred claims Total remaining coverage incurred claims Total Insurance contract liabilities, beginning of period $ 18,667 $ 199 $ 18,866 $ 17,047 $ 201 $ 17,248 Insurance service results (1,626) 1,436 (190) (1,818) 1,537 (281) Net finance expense from insurance contracts (53) – (53) 420 – 420 Total cash flows 2,534 (1,456) 1,078 2,293 (1,546) 747 Other changes in the net carrying amount of the insurance contract (1) 13 (16) (3) (785) (15) (800) Insurance contract liabilities, end of period (2) $ 19,535 $ 163 $ 19,698 $ 17,157 $ 177 $ 17,334 (1) Includes $(798) million relating to the sale of a non-strategic portfolio of insurance contracts for the three and nine months ended July 31, 2025. (2) The liabilities for incurred claims relating to insurance contracts in our creditor and reinsurance business were $103 million as at July 31, 2026 and $105 million as at July 31, 2025. Contractual service margin (CSM) from contracts issued was $32 million and $115 million for the three and nine months ended July 31, 2026, respectively ($18 million and $49 million for the three and nine months ended July 31, 2025, respectively). Total CSM for insurance contracts issued and reinsurance contract held was $1,687 million and $338 million, respectively, as at July 31, 2026 ($1,528 million and $312 million, respectively, as at October 31, 2025). Onerous contract losses for the three and nine months ended July 31, 2026 and 2025 were not material. 56 BMO Financial Group Third Quarter Report 2026
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We use the following rates for discounting fulfilment cash flows for our insurance contract liabilities, which are based on a risk-free yield adjusted for an illiquidity premium that reflects the liquidity characteristics of the liabilities: Portfolio duration: July 31, 2026 October 31, 2025 1 year 3.74% 3.24% 3 years 4.22% 3.54% 5 years 4.55% 3.89% 10 years 5.21% 4.67% 20 years 5.77% 5.25% 30 years 5.69% 4.99% Ultimate 4.95% 5.00% Insurance Risk Management The table below reflects the estimated immediate impact on, or sensitivity of, income before taxes to certain changes in interest rates, and includes the estimated impact of hedging arrangements and our exposure to equity price risk arising from our investment in equity securities. (Canadian $ in millions) July 31, 2026 October 31, 2025 Interest Rate Sensitivity (1) (2) 50 basis point increase $ 2 $ 2 50 basis point decrease (1) (6) Equity Market Sensitivity (3) 10% increase $ 7 $ 6 10% decrease (7) (7) (1) Estimated impact on, or sensitivity of, income before taxes to a 50 basis point increase or decrease in interest rates. (2) Interest rate sensitivities assume a parallel shift in assumed interest rates across the entire yield curve as at the end of the period with no change in the ultimate risk-free rate. (3) Estimated impact on, or sensitivity of, income before taxes to a 10% increase or decrease in our exposure to equity price risk arising from our investment in equity securities at the reporting date, assuming all other variables remain constant. BMO Financial Group Third Quarter Report 2026 57
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Note 6: Equity Preferred and Common Shares Outstanding and Other Equity Instruments (1) (Canadian $ in millions, except as noted) July 31, 2026 October 31, 2025 Number Dividends declared Number Dividends declared of shares Amount per share (2) of shares Amount per share (2) Convertible into Preferred Shares – Classified as Equity Class B – Series 44 16,000,000 $ 400 $ 1.28 16,000,000 $ 400 $ 1.70 Class B - Series 45 (3) (4) Class B – Series 50 500,000 500 36.87 500,000 500 73.73 Not convertible (4) Class B – Series 52 650,000 650 35.29 650,000 650 70.57 Not convertible (4) Preferred Shares – Classified as Equity $ 1,550 $ 1,550 Recourse to Other Equity Instruments 4.800% Additional Tier 1 Capital Notes (AT1 Notes) $ 658 $ 658 – (4) (5) (6) 4.300% Limited Recourse Capital Notes, Series 1 (LRCNs, Series 1) – 1,250 – (6) (7) 5.625% Limited Recourse Capital Notes, Series 2 (LRCNs, Series 2) 750 750 Preferred Shares Series 49 (4) (6) (8) 7.325% Limited Recourse Capital Notes, Series 3 (LRCNs, Series 3) 1,000 1,000 Preferred Shares Series 51 (4) (6) (8) 7.700% Limited Recourse Capital Notes, Series 4 (LRCNs, Series 4) 1,356 1,356 Preferred Shares Series 53 (4) (6) (8) 7.300% Limited Recourse Capital Notes, Series 5 (LRCNs, Series 5) 1,023 1,023 Preferred Shares Series 54 (4) (6) (8) 6.875% Limited Recourse Capital Notes, Series 6 (LRCNs, Series 6) 1,369 1,369 Preferred Shares Series 55 (4) (6) (8) Other Equity Instruments 6,156 7,406 Preferred Shares and Other Equity Instruments 7,706 8,956 Common Shares 697,146,398 $ 23,473 $ 5.05 708,905,679 $ 23,359 $ 6.44 (9) (10) (11) (12) (1) For additional information refer to Notes 16 and 20 of our annual consolidated financial statements for the year ended October 31, 2025. (2) Represents year-to-date dividends declared per share as at reporting date. Non-cumulative dividends on preferred shares are payable quarterly as and when declared by the Board of Directors, except for Class B – Series 50 and 52 preferred share dividends, which are payable semi-annually. (3) If converted, the holders have the option to convert back to the original preferred shares on subsequent redemption dates, subject to certain conditions. (4) The instruments issued include a NVCC provision, which is necessary for the preferred shares, AT1 Notes and by virtue of the recourse to the Preferred Shares Series 49, Preferred Shares Series 51, Preferred Shares Series 53, Preferred Shares Series 54 and Preferred Shares Series 55 (collectively, the LRCN Preferred Shares) for LRCNs, Series 2, Series 3, Series 4, Series 5 and Series 6 (collectively, the LRCNs), respectively, to qualify as regulatory capital under Basel III. As such, they are convertible into a variable number of our common shares if OSFI announces that the bank is, or is about to become, non-viable or if a federal or provincial government in Canada publicly announces that the bank has accepted or agreed to accept a capital injection, or equivalent support, to avoid non-viability. In such an event, each preferred share, including the LRCN Preferred Shares and AT1 Notes, is convertible into common shares pursuant to an automatic conversion formula and a conversion price based on the greater of: (i) a floor price of $5.00 and (ii) the current market price of our common shares based on the volume weighted average trading price of our common shares on the TSX. The number of common shares issued is determined by dividing the value of the preferred share or other equity instrument, including declared and unpaid dividends, by the conversion price and then applying the multiplier. (5) The notes had an initial interest rate of 4.800% and reset on August 25, 2024 to 6.709%. (6) The rates represent the annual interest rate percentage applicable to the notes issued as at the reporting date. (7) On November 12, 2025, we redeemed the $1,250 million 4.300% Limited Recourse Capital Notes, Series 1 (NVCC) and the corresponding $1,250 million Preferred Shares Series 48 (NVCC). (8) Non-deferrable interest is payable semi-annually on the LRCNs, Series 2 and Series 3, and quarterly on the LRCNs, Series 4, Series 5 and Series 6 at the bank’s discretion. Non-payment of interest will result in a recourse event, with the noteholders’ sole remedy being the holders’ proportionate share of trust assets, which comprises the LRCN Preferred Shares, each series of which is issued concurrently with the corresponding LRCNs and are eliminated on consolidation. In such an event, the delivery of the trust assets will represent the full and complete extinguishment of our obligations under the LRCNs. In circumstances where the LRCN Preferred Shares are converted into common shares of the bank under the NVCC provision, the LRCNs would be redeemed and the noteholders’ sole remedy would be their proportionate share of trust assets, which would then comprise common shares of the bank received by the trust on conversion. (9) The stock options issued under the Stock Option Plan are convertible into 5,169,041 common shares as at July 31, 2026 (5,699,134 common shares as at October 31, 2025) of which 2,020,746 are exercisable as at July 31, 2026 (2,245,942 as at October 31, 2025). (10) During the three and nine months ended July 31, 2026, we issued 507,279 and 1,294,493 common shares under the Stock Option Plan (289,748 and 975,467 common shares during the three and nine months ended July 31, 2025). (11) Common shares are net of nil treasury shares as at July 31, 2026 (nil treasury shares as at October 31, 2025). (12) As part of the acquisition of Burgundy on November 1, 2025, we issued 2,723,726 common shares with an aggregate value of $481 million to shareholders of Burgundy. Refer to Note 13 for more information. Other Equity Instruments The AT1 Notes and existing LRCNs are compound financial instruments that have both equity and liability features. On the date of issuance, we assigned an insignificant value to the liability components of both instruments and, as a result, the full amount of proceeds has been classified as equity and forms part of our additional Tier 1 Capital. Distributions on the AT1 Notes and LRCNs are recognized as a reduction in equity when payable. The AT1 Notes and LRCNs are subordinate to the claims of the depositors and certain other creditors in right of payment. Common Shares We have a normal course issuer bid (NCIB) to purchase up to 30 million of our common shares for cancellation which commenced on September 5, 2025 and ending no later than September 4, 2026. The timing and amount of purchases under the NCIB are determined by management, based on factors such as market conditions and capital levels. During the three months ended July 31, 2026, we purchased for cancellation 3.8 million common shares under the NCIB, at an average price of $239.37 per share for a total amount of $922 million, including tax. During the nine months ended July 31, 2026, we purchased for cancellation 15.8 million common shares under the NCIB, at an average price of $198.60 per share for a total amount of $3,193 million, including tax. The bank has purchased a total of 21.6 million common shares for cancellation under the NCIB as at July 31, 2026. On August 25, 2026 we announced our intention to establish a new NCIB to purchase up to 25 million of our common shares for cancellation, subject to the approval of the Office of the Superintendent of Financial Institutions Canada (OSFI) and the Toronto Stock Exchange. Shareholder Dividend Reinvestment and Share Purchase Plan Until further notice, common shares under the Shareholder Dividend Reinvestment and Share Purchase Plan will be purchased on the open market without a discount. 58 BMO Financial Group Third Quarter Report 2026
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Note 7: Fair Value Measurements Fair Value of Financial Instruments Not Carried at Fair Value on the Balance Sheet Set out in the following table are the amounts that would be reported if all financial instruments not currently carried at fair value were reported at their fair values. Refer to Note 17 of our annual consolidated financial statements for the year ended October 31, 2025 for further discussion on the determination of fair value. (Canadian $ in millions) July 31, 2026 October 31, 2025 Carrying value Fair value Carrying value Fair value Securities (1) Amortized cost $ 92,978 $ 86,914 $ 96,610 $ 90,448 Loans (1) (2) Residential mortgages 196,627 195,540 195,708 194,755 Consumer instalment and other personal 93,378 93,314 91,867 91,937 Credit cards 11,359 11,359 11,997 11,997 Business and government 381,968 382,200 364,265 364,866 683,332 682,413 663,837 663,555 Deposits (3) 953,155 952,770 920,040 920,927 Securitization and structured entities' liabilities (4) 18,830 18,503 20,211 20,100 Other liabilities (5) 3,191 3,071 3,103 2,953 Subordinated debt 7,495 7,683 8,500 8,756 This table excludes financial instruments with a carrying value approximating fair value, such as cash and cash equivalents, interest bearing deposits with banks, securities borrowed or purchased under resale agreements, certain other assets, certain other liabilities and securities lent or sold under repurchase agreements. (1) Carrying value is net of ACL. (2) Excludes $67 million of residential mortgages classified as FVTPL, $12,649 million of business and government loans classified as FVTPL and $447 million of business and government loans classified as FVOCI ($79 million, $13,231 million and $14 million, respectively, as at October 31, 2025). (3) Excludes $56,350 million of structured note liabilities, $83 million of money market deposits, $2,497 million of embedded options related to structured deposits carried at amortized cost and $5,749 million of metals deposits measured at fair value ($49,093 million, $1,129 million, $1,967 million and $3,973 million, respectively, as at October 31, 2025). (4) Excludes $44,081 million of securitization and structured entities’ liabilities classified as FVTPL ($31,351 million as at October 31, 2025). (5) Other liabilities include certain investment contract liabilities in our insurance business measured at amortized cost, as well as certain other liabilities of subsidiaries. Fair Value Hierarchy We use a fair value hierarchy to categorize assets and liabilities carried at fair value according to the inputs we use in valuation techniques to measure fair value. Valuation Techniques and Significant Inputs We determine the fair value of assets and liabilities using quoted prices in active markets (Level 1) when these are available. When quoted prices in active markets are not available, we determine the fair value of financial assets and liabilities using models such as discounted cash flows with observable market data for inputs, such as yields or broker quotes and other third-party vendor quotes (Level 2). Fair value may also be determined using models where significant market inputs are not observable due to inactive markets or minimal market activity (Level 3). We maximize the use of observable market inputs to the extent possible. Our Level 2 trading securities are primarily valued using discounted cash flow models with observable spreads or broker quotes. The fair value of Level 2 FVOCI securities is determined using discounted cash flow models with observable spreads or third-party vendor quotes. Level 2 structured note liabilities are valued using models with observable market information. Level 2 derivative assets and liabilities are valued using industry standard models and observable market information. BMO Financial Group Third Quarter Report 2026 59
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The extent of our use of actively quoted market prices (Level 1), internal models using observable market information as inputs (Level 2) and models using one or more significant unobservable inputs (Level 3) in the valuation of securities, loans classified as FVTPL and FVOCI, other assets, fair value liabilities, derivative assets and derivative liabilities is presented in the following table: (Canadian $ in millions) July 31, 2026 October 31, 2025 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Trading Securities Issued or guaranteed by: Canadian federal government $ 455 $ 8,955 $ – $ 9,410 $ 757 $ 11,554 $ – $ 12,311 Canadian provincial and municipal governments – 9,219 – 9,219 – 9,035 – 9,035 U.S. federal government 1,865 25,670 – 27,535 3,308 27,594 – 30,902 U.S. states, municipalities and agencies – 363 – 363 – 1,144 – 1,144 Other governments 241 4,620 – 4,861 199 3,927 – 4,126 NHA MBS, and U.S. agency MBS and CMO – 74,426 – 74,426 – 56,450 – 56,450 Corporate debt – 16,583 – 16,583 – 11,614 – 11,614 Trading loans – 3,449 – 3,449 – 4,568 – 4,568 Corporate equity 57,583 1,389 – 58,972 61,495 658 – 62,153 60,144 144,674 – 204,818 65,759 126,544 – 192,303 FVTPL Securities Issued or guaranteed by: Canadian federal government – 1,329 – 1,329 56 1,563 – 1,619 Canadian provincial and municipal governments – 2,393 – 2,393 – 1,578 – 1,578 U.S. federal government – 1,721 – 1,721 – 1,495 – 1,495 Other governments – 97 – 97 – – – – NHA MBS, and U.S. agency MBS and CMO – 18 – 18 – 18 – 18 Corporate debt – 9,961 12 9,973 – 8,908 – 8,908 Corporate equity 1,202 856 6,171 8,229 1,090 822 5,824 7,736 1,202 16,375 6,183 23,760 1,146 14,384 5,824 21,354 FVOCI Securities Issued or guaranteed by: Canadian federal government 3,402 55,791 – 59,193 1,158 44,177 – 45,335 Canadian provincial and municipal governments – 7,612 – 7,612 – 5,644 – 5,644 U.S. federal government 24 27,033 – 27,057 16 20,793 – 20,809 U.S. states, municipalities and agencies – 4,939 – 4,939 – 5,634 – 5,634 Other governments 47 4,247 – 4,294 37 4,028 – 4,065 NHA MBS, and U.S. agency MBS and CMO – 29,043 – 29,043 – 27,015 – 27,015 Corporate debt – 4,739 – 4,739 – 4,515 – 4,515 Corporate equity – – 193 193 – – 192 192 3,473 133,404 193 137,070 1,211 111,806 192 113,209 Loans Residential mortgages – 67 – 67 – 79 – 79 Business and government loans – 12,786 310 13,096 – 12,921 324 13,245 – 12,853 310 13,163 – 13,000 324 13,324 Other Assets (1) 10,719 – 1,460 12,179 8,521 – 1,483 10,004 Fair Value Liabilities (2) Deposits (3) – 64,679 – 64,679 – 56,162 – 56,162 Securities sold but not yet purchased 13,284 37,814 – 51,098 14,998 39,878 – 54,876 Other liabilities (4) 2,443 44,773 198 47,414 2,142 32,096 – 34,238 15,727 147,266 198 163,191 17,140 128,136 – 145,276 Derivative Assets Interest rate contracts 114 13,182 – 13,296 15 8,666 – 8,681 Foreign exchange contracts 95 24,604 4 24,703 43 30,474 2 30,519 Commodity contracts 155 2,748 1 2,904 225 1,224 13 1,462 Equity contracts 182 26,877 2 27,061 275 16,203 10 16,488 Credit default swaps – 33 – 33 – 1 – 1 546 67,444 7 67,997 558 56,568 25 57,151 Derivative Liabilities Interest rate contracts 81 12,937 – 13,018 18 10,081 – 10,099 Foreign exchange contracts – 22,153 27 22,180 – 26,049 – 26,049 Commodity contracts 141 2,728 4 2,873 196 1,412 – 1,608 Equity contracts 763 30,736 1 31,500 175 20,793 5 20,973 Credit default swaps – 25 1 26 – – – – 985 68,579 33 69,597 389 58,335 5 58,729 (1) Other assets include precious metals, segregated fund assets and investment properties in our insurance business, carbon credits, certain receivables and other items measured at fair value. (2) Interest expense for liabilities carried at fair value is $1,253 million and $3,497 million for the three and nine months ended July 31, 2026, respectively ($832 million and $2,612 million for the three and nine months ended July 31, 2025). Interest expense for liabilities carried at amortized cost is $8,967 million and $25,989 million for the three and nine months ended July 31, 2026, respectively ($9,414 million and $29,416 million for the three and nine months ended July 31, 2025). (3) Deposits include structured note liabilities, money market and metals deposits designated at FVTPL and certain embedded options related to structured deposits carried at amortized cost. (4) Other liabilities include certain investment contract liabilities and segregated fund liabilities in our insurance business, certain securitization and structured entities’ liabilities measured at FVTPL, as well as the contingent consideration liability from the acquisition of Burgundy Asset Management Ltd. Refer to Note 13 for more information. 60 BMO Financial Group Third Quarter Report 2026
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Quantitative Information about Level 3 Fair Value Measurements The table below presents the fair values of our significant Level 3 financial instruments measured at fair value on a recurring basis, the valuation techniques used to determine their fair values and the value ranges of significant unobservable inputs used in the valuations. We have not applied any other reasonably possible alternative assumptions to the significant Level 3 categories of private equity investments, as the net asset values are provided by the investment or fund managers. (Canadian $ in millions, except as noted) July 31, 2026 Reporting line in fair Significant Range of input values (1) value hierarchy table Fair value Valuation techniques unobservable inputs Low High Private equity Corporate equity $ 6,364 Net asset value Net asset value na na EV/EBITDA Multiple 6 21 Investment properties Other assets 1,362 Income approach Capitalization rate 6% 7% Burgundy contingent consideration (2) Other liabilities 198 Income approach Discount rate na na Forecasted assets under management na na (1) The low and high input values represent the lowest and highest actual level of inputs used to value a group of financial instruments in a particular product category. These input ranges do not reflect the level of input uncertainty, but are affected by the specific underlying instruments within each product category. The input ranges will therefore vary from period to period based on the characteristics of the underlying instruments held at each balance sheet date. (2) Range of inputs not applicable as the value is modeled using a Monte Carlo simulation. na - not applicable Significant Transfers Our policy is to record transfers of assets and liabilities between fair value hierarchy levels at their fair values as at the end of each reporting period, consistent with the date of the determination of fair value. Transfers between Level 1 and Level 2 are dependent on the recency of issuance and availability of quoted market prices in the active market. There were no significant transfers between Level 1 and Level 2 during the three and nine months ended July 31, 2026 and 2025. Changes in Level 3 Fair Value Measurements The tables below present a reconciliation of all changes in Level 3 financial instruments for the three and nine months ended July 31, 2026 and 2025, including realized and unrealized gains (losses) included in earnings and other comprehensive income as well as transfers into and out of Level 3. Transfers from Level 2 into Level 3 were due to an increase in unobservable market inputs used in pricing the financial instruments. Transfers out of Level 3 into Level 2 were due to an increase in observable market inputs used in pricing the financial instruments. BMO Financial Group Third Quarter Report 2026 61
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Change in fair value Movements Transfers Change in unrealized gains Included (losses) recorded Fair Value in other Transfers Transfers Fair Value in income For the three months ended July 31, 2026 as at April 30, Included in comprehensive Issuances/ Maturities/ into out of as at July 31, for instruments (Canadian $ in millions) 2026 earnings income (1) Purchases Sales Settlement Level 3 Level 3 2026 still held (2) Trading Securities NHA MBS and U.S. agency MBS and CMO $ – $ – $ – $ – $ – $ – $ – $ – $ – $ – Corporate equity – – – – – – – – – – Total trading securities – – – – – – – – – – FVTPL Securities Corporate debt 3 9 – – – – – – 12 9 Corporate equity 5,818 28 78 389 (140) – – (2) 6,171 85 Total FVTPL securities 5,821 37 78 389 (140) – – (2) 6,183 94 FVOCI Securities Corporate equity 189 – 4 – – – – – 193 na Total FVOCI securities 189 – 4 – – – – – 193 na Business and Government Loans 314 1 10 – – (15) – – 310 1 Other Assets 1,495 (21) 2 8 – (24) – – 1,460 (21) Derivative Assets Foreign exchange contracts 19 (15) – – – – – – 4 (15) Commodity contracts – 1 – – – – – – 1 1 Equity contracts 7 – – – – – – (5) 2 – Credit default swaps – – – – – – – – – – Total derivative assets 26 (14) – – – – – (5) 7 (14) Other Liabilities 135 63 – – – – – – 198 63 Derivative Liabilities Foreign exchange contracts 8 19 – – – – – – 27 19 Commodity contracts 8 (4) – – – – – – 4 (4) Equity contracts 5 1 – – – – – (5) 1 1 Credit default swaps – 1 – – – – – – 1 1 Total derivative liabilities 21 17 – – – – – (5) 33 17 Change in fair value Movements Transfers Change in unrealized gains Included (losses) recorded Fair Value in other Transfers Transfers Fair Value in income For the nine months ended July 31, 2026 as at October 31, Included in comprehensive Issuances/ Maturities/ into out of as at July 31, for instruments (Canadian $ in millions) 2025 earnings income (1) Purchases Sales Settlement Level 3 Level 3 2026 still held (2) Trading Securities NHA MBS and U.S. agency MBS and CMO $ – $ – $ – $ – $ – $ – $ – $ – $ – $ – Corporate equity – – – – – – – – – – Total trading securities – – – – – – – – – – FVTPL Securities Corporate debt – 9 – 3 – – – – 12 9 Corporate equity 5,824 (139) 3 920 (504) – 73 (6) 6,171 33 Total FVTPL securities 5,824 (130) 3 923 (504) – 73 (6) 6,183 42 FVOCI Securities Corporate equity 192 – – 1 – – – – 193 na Total FVOCI securities 192 – – 1 – – – – 193 na Business and Government Loans 324 4 (26) 23 – (15) – – 310 4 Other Assets 1,483 (18) – 54 (10) (49) – – 1,460 (18) Derivative Assets Foreign exchange contracts 2 2 – – – – – – 4 2 Commodity contracts 13 (12) – – – – – – 1 (12) Equity contracts 10 (1) – – – – 4 (11) 2 (1) Credit default swaps – – – – – – – – – – Total derivative assets 25 (11) – – – – 4 (11) 7 (11) Other Liabilities – 86 – 112 – – – – 198 86 Derivative Liabilities Foreign exchange contracts – 27 – – – – – – 27 27 Commodity contracts – 4 – – – – – – 4 4 Equity contracts 5 1 – – – – 5 (10) 1 1 Credit default swaps – 1 – – – – – – 1 1 Total derivative liabilities 5 33 – – – – 5 (10) 33 33 (1) Foreign exchange translation on assets and liabilities held by foreign operations is included in other comprehensive income, net foreign operations. (2) Changes in unrealized gains (losses) on Trading and FVTPL securities still held on July 31, 2026 are included in earnings for the period. Unrealized gains (losses) recognized on Level 3 financial instruments may be offset by (losses) gains on economic hedge contracts. na – not applicable 62 BMO Financial Group Third Quarter Report 2026
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Change in fair value Movements Transfers Change in unrealized gains Included (losses) recorded Fair Value in other Transfers Transfers Fair Value in income For the three months ended July 31, 2025 as at April 30, Included in comprehensive Issuances/ Maturities/ into out of as at July 31, for instruments (Canadian $ in millions) 2025 earnings income (1) Purchases Sales Settlement Level 3 Level 3 2025 still held (2) Trading Securities NHA MBS and U.S. agency MBS and CMO $ 5 $ – $ – $ – $ (5) $ – $ – $ – $ – $ – Corporate equity – – – – – – – – – – Total trading securities 5 – – – (5) – – – – – FVTPL Securities Corporate debt 36 – – – – – – (36) – – Corporate equity 5,257 (25) 10 288 (55) – – (6) 5,469 20 Total FVTPL securities 5,293 (25) 10 288 (55) – – (42) 5,469 20 FVOCI Securities Corporate equity 189 – – 1 – – – – 190 na Total FVOCI securities 189 – – 1 – – – – 190 na Business and Government Loans 382 (17) – – – (46) – – 319 (17) Other Assets 1,435 – – 13 – (15) – – 1,433 – Derivative Assets Foreign exchange contracts – – – 16 – – – – 16 – Commodity contracts 9 (7) – – – – – – 2 (7) Equity contracts 14 2 – – – – – – 16 2 Credit default swaps 1 – – – – (1) – – – – Total derivative assets 24 (5) – 16 – (1) – – 34 (5) Other Liabilities – – – – – – – – – – Derivative Liabilities Foreign exchange contracts – – – – – – – – – – Commodity contracts – – – – – – – – – – Equity contracts 1 – – – – – – (1) – – Credit default swaps – – – – – – – – – – Total derivative liabilities 1 – – – – – – (1) – – Change in fair value Movements Transfers Change in unrealized gains Included (losses) recorded Fair Value in other Transfers Transfers Fair Value in income For the nine months ended July 31, 2025 as at October 31, Included in comprehensive Issuances/ Maturities/ into out of as at July 31, for instruments (Canadian $ in millions) 2024 earnings income (1) Purchases Sales Settlement Level 3 Level 3 2025 still held (2) Trading Securities NHA MBS and U.S. agency MBS and CMO $ – $ – $ – $ 5 (5) $ – $ – $ – $ – $ – Corporate equity 4 – – 2 – – – (6) – – Total trading securities 4 – – 7 (5) – – (6) – – FVTPL Securities Corporate debt 35 1 – 2 – – – (38) – 1 Corporate equity 4,899 (121) (11) 902 (194) – – (6) 5,469 36 Total FVTPL securities 4,934 (120) (11) 904 (194) – – (44) 5,469 37 FVOCI Securities Corporate equity 177 – (15) 28 – – – – 190 na Total FVOCI securities 177 – (15) 28 – – – – 190 na Business and Government Loans 302 (15) (1) 56 – (52) 29 – 319 (15) Other Assets 1,717 (56) – 214 (7) (435) – – 1,433 (52) Derivative Assets Foreign exchange contracts 10 – – 48 – (42) – – 16 – Commodity contracts 2 – – – – – – – 2 – Equity contracts – – – – – – 16 – 16 – Credit default swaps – – – – – (1) 1 – – – Total derivative assets 12 – – 48 – (43) 17 – 34 – Other Liabilities – – – – – – – – – – Derivative Liabilities Foreign exchange contracts – – – – – – – – – – Commodity contracts 4 (4) – – – – – – – (4) Equity contracts 2 – – – – – 1 (3) – – Credit default swaps 1 – – – – (1) – – – – Total derivative liabilities 7 (4) – – – (1) 1 (3) – (4) (1) Foreign exchange translation on assets and liabilities held by foreign operations is included in other comprehensive income, net foreign operations. (2) Changes in unrealized gains (losses) on Trading and FVTPL securities still held on July 31, 2025 are included in earnings for the period. Unrealized gains (losses) recognized on Level 3 financial instruments may be offset by (losses) gains on economic hedge contracts. na – not applicable BMO Financial Group Third Quarter Report 2026 63
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Note 8: Capital Management Our objective is to maintain a strong capital position in a cost-effective structure that is appropriate given our target regulatory capital ratios and our internal assessment of required economic capital; underpins our operating segments’ business strategies and considers the market environment; supports depositor, investor and regulator confidence, while building long-term shareholder value; and is consistent with our target credit ratings. As at July 31, 2026, we met OSFI’s target capital ratio requirements, which include a 2.5% Capital Conservation Buffer, a 1.0% Common Equity Surcharge for Domestic Systemically Important Banks (D-SIBs), a Countercyclical Buffer and a 3.0% Domestic Stability Buffer (DSB) applicable to D-SIBs. On June 19, 2026, OSFI announced the reduction in the DSB level from 3.5% to 3.0%, effective immediately. In addition, OSFI lowered the DSB range from 0% to 4% to 0% to 3%. Our capital position as at July 31, 2026 is further detailed in the Capital Management section of our interim Management’s Discussion and Analysis. Regulatory Capital and Total Loss Absorbing Capacity Measures, Risk-Weighted Assets and Leverage Exposures (1) (Canadian $ in millions, except as noted) July 31, 2026 October 31, 2025 CET1 Capital $ 59,273 $ 58,286 Tier 1 Capital 66,864 65,890 Total Capital 75,467 75,562 TLAC 132,620 129,957 Risk-Weighted Assets 454,757 437,945 Leverage Exposures 1,586,178 1,521,813 CET1 Ratio 13.0% 13.3% Tier 1 Capital Ratio 14.7% 15.0% Total Capital Ratio 16.6% 17.3% TLAC Ratio 29.2% 29.7% Leverage Ratio 4.2% 4.3% TLAC Leverage Ratio 8.4% 8.5% (1) Calculated in accordance with OSFI’s Capital Adequacy Requirements Guideline, Leverage Requirements Guideline and Total Loss Absorbing Capacity (TLAC) Guideline. Note 9: Employee Compensation Stock Options We did not grant any stock options during the three months ended July 31, 2026 or 2025. During the nine months ended July 31, 2026, we granted a total of 764,400 stock options (716,633 stock options during the nine months ended July 31, 2025) with a weighted-average fair value of $32.09 per option ($18.46 per option for the nine months ended July 31, 2025). To determine the fair value of the stock option tranches (i.e. the portion that vests each year) on the grant date, the following ranges of values were used for each option pricing assumption: For stock options granted during the nine months ended July 31, 2026 July 31, 2025 Expected dividend yield 2.5% - 2.6% 3.6% Expected share price volatility 18.5% - 18.6% 16.7% Risk-free rate of return 3.0% 2.8% Expected period until exercise (in years) 6.5 - 7.0 6.5 - 7.0 Exercise price ($) 181.30 141.00 Changes to the input assumptions can result in different fair value estimates. Pension and Other Employee Future Benefit Expenses Pension and other employee future benefit expenses are determined as follows: (Canadian $ in millions) Pension plans Other employee future benefit plans For the three months ended July 31, 2026 July 31, 2025 July 31, 2026 July 31, 2025 Current service cost $ 43 $ 44 $ 1 $ 2 Net interest (income) expense (1) (13) (12) 10 9 Impact of plan amendments – – – – Administrative expense 2 2 – – Benefits expense 32 34 11 11 Government pension plans expense (2) 101 96 – – Defined contribution expense 71 66 – – Total pension and other employee future benefit expenses recognized in our Consolidated Statement of Income $ 204 $ 196 $ 11 $ 11 (1) Net interest (income) expense is increased by $nil million for pension benefit plans and $1 million for other employee future benefit plans for the three months ended July 31, 2026 ($nil million for pension benefit plans and $1 million for other employee future benefit plans for the three months ended July 31, 2025) as a result of assets written down through other comprehensive income due to the asset ceiling. (2) Includes Canada Pension Plan, Quebec Pension Plan and U.S. Federal Insurance Contribution Act. 64 BMO Financial Group Third Quarter Report 2026
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(Canadian $ in millions) Pension benefit plans Other employee future benefit plans For the nine months ended July 31, 2026 July 31, 2025 July 31, 2026 July 31, 2025 Current service cost $ 131 $ 133 $ 4 $ 5 Net interest (income) expense (1) (41) (38) 27 28 Impact of plan amendments – (19) – – Administrative expense 7 9 – – Benefits expense 97 85 31 33 Government pension plans expense (2) 326 310 – – Defined contribution expense 254 244 – – Total pension and other employee future benefit expenses recognized in our Consolidated Statement of Income $ 677 $ 639 $ 31 $ 33 (1) Net interest (income) expense is increased by $nil million for pension benefit plans and $3 million for other employee future benefit plans for the nine months ended July 31, 2026 ($nil million for pension benefit plans and $4 million for other employee future benefit plans for the nine months ended July 31, 2025) as a result of assets written down through other comprehensive income due to the asset ceiling. (2) Includes Canada Pension Plan, Quebec Pension Plan and U.S. Federal Insurance Contribution Act. Note 10: Earnings Per Share Basic earnings per share is calculated by dividing net income attributable to bank shareholders, after deducting dividends payable on preferred shares and distributions payable on other equity instruments, by the daily average number of fully paid common shares outstanding throughout the period. Diluted earnings per share is calculated in the same manner, with further adjustments made to reflect the dilutive impact of instruments convertible into our common shares. The following tables present our basic and diluted earnings per share: Basic Earnings Per Common Share (Canadian $ in millions, except as noted) For the three months ended For the nine months ended July 31, 2026 July 31, 2025 July 31, 2026 July 31, 2025 Net income attributable to bank shareholders $ 1,748 $ 2,327 $ 6,864 $ 6,421 Dividends on preferred shares and distributions on other equity instruments (81) (66) (301) (273) Net income available to common shareholders $ 1,667 $ 2,261 $ 6,563 $ 6,148 Weighted-average number of common shares outstanding (in thousands) 699,361 719,514 703,487 724,820 Basic earnings per common share (Canadian $) $ 2.38 $ 3.14 $ 9.33 $ 8.48 Diluted Earnings Per Common Share (Canadian $ in millions, except as noted) For the three months ended For the nine months ended July 31, 2026 July 31, 2025 July 31, 2026 July 31, 2025 Net income available to common shareholders $ 1,667 $ 2,261 $ 6,563 $ 6,148 Weighted-average number of common shares outstanding (in thousands) 699,361 719,514 703,487 724,820 Dilutive impact of stock options (1) Stock options potentially exercisable 5,252 5,597 5,423 5,912 Common shares potentially repurchased (2,932) (4,318) (3,526) (4,751) Weighted-average number of diluted common shares outstanding (in thousands) 701,681 720,793 705,384 725,981 Diluted earnings per common share (Canadian $) $ 2.38 $ 3.14 $ 9.30 $ 8.47 (1) The dilutive effect of stock options was calculated using the treasury stock method. In computing diluted earnings per share, we excluded average stock options outstanding of nil and 422,800 with a weighted-average exercise price of $nil and $199.52 for the three and nine months ended July 31, 2026, respectively (716,633 and 635,554 with a weighted-average exercise price of $149.35 and $150.96 for the three and nine months ended July 31, 2025, respectively), as the average share price for the periods did not exceed the exercise price. Note 11: Income Taxes Tax Assessments Canadian tax authorities have reassessed us for additional income tax and interest in an amount of approximately $1,465 million in respect of certain 2011–2018 Canadian corporate dividends. These reassessments denied certain dividend deductions on the basis that the dividends were received as part of a “dividend rental arrangement”. In general, the tax rules raised by the Canadian tax authorities were prospectively addressed in the 2015 and 2018 Canadian federal budgets. We filed Notices of Appeal with the Tax Court of Canada and the matter is in litigation. We remain of the view that our tax filing positions were appropriate and intend to challenge all reassessments. However, if such challenges are unsuccessful, the additional expense would negatively impact our net income. BMO Financial Group Third Quarter Report 2026 65
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Note 12: Operating Segmentation Operating Segments We conduct our business through four operating segments, each of which has a distinct mandate. Our operating segments are Canadian Personal and Commercial Banking (Canadian P&C), U.S. Banking, Wealth Management and Capital Markets, along with a Corporate Services unit. For additional information refer to Note 25 of our annual consolidated financial statements for the year ended October 31, 2025. Our results and average assets, grouped by operating segment, are as follows: (Canadian $ in millions) Canadian Wealth Capital Corporate For the three months ended July 31, 2026 P&C U.S. Banking (1) Management Markets (1) Services (1) (2) Total Net interest income $ 2,558 $ 2,390 $ 315 $ 583 $ (279) $ 5,567 Non-interest revenue 699 644 1,264 1,544 178 4,329 Total Revenue 3,257 3,034 1,579 2,127 (101) 9,896 Provision for credit losses on impaired loans 447 223 2 30 6 708 Provision for (recovery of) credit losses on performing loans 60 (50) (3) 11 (4) 14 Total provision for credit losses 507 173 (1) 41 2 722 Depreciation and amortization 182 228 68 79 – 557 Non-interest expense 1,217 1,522 966 1,150 1,266 6,121 Income (loss) before taxes and non-controlling interest in subsidiaries 1,351 1,111 546 857 (1,369) 2,496 Provision for (recovery of) income taxes 371 243 138 212 (218) 746 Reported net income (loss) $ 980 $ 868 $ 408 $ 645 $ (1,151) $ 1,750 Non-controlling interest in subsidiaries $ – $ 1 $ – $ – $ 1 $ 2 Net income (loss) attributable to bank shareholders $ 980 $ 867 $ 408 $ 645 $ (1,152) $ 1,748 Average assets (3) $ 351,274 $ 254,477 $ 59,923 $ 614,772 $ 290,028 $ 1,570,474 Canadian Wealth Capital Corporate For the three months ended July 31, 2025 P&C U.S. Banking (1) Management Markets (1) Services (1) (2) Total Net interest income $ 2,459 $ 2,221 $ 257 $ 729 $ (170) $ 5,496 Non-interest revenue 617 609 1,108 1,047 111 3,492 Total Revenue 3,076 2,830 1,365 1,776 (59) 8,988 Provision for credit losses on impaired loans 489 241 1 33 9 773 Provision for (recovery of) credit losses on performing loans 76 (70) 2 23 (7) 24 Total provision for (recovery of) credit losses 565 171 3 56 2 797 Depreciation and amortization 162 237 54 80 – 533 Non-interest expense 1,179 1,433 788 1,052 120 4,572 Income (loss) before taxes and non-controlling interest in subsidiaries 1,170 989 520 588 (181) 3,086 Provision for (recovery of) income taxes 321 222 128 146 (61) 756 Reported net income (loss) $ 849 $ 767 $ 392 $ 442 $ (120) $ 2,330 Non-controlling interest in subsidiaries $ – $ 2 $ – $ – $ 1 $ 3 Net income (loss) attributable to bank shareholders $ 849 $ 765 $ 392 $ 442 $ (121) $ 2,327 Average assets (3) $ 345,353 $ 251,683 $ 53,484 $ 514,825 $ 268,397 $ 1,433,742 (1) Operating segments report on a taxable equivalent basis (teb). Net interest income, revenue and the provision for income taxes are increased on tax-exempt securities to an equivalent before-tax basis to facilitate comparisons of income between taxable and tax-exempt sources. The offset to the groups’ teb adjustments is reflected in Corporate Services net interest income, revenue and provision for income taxes. (2) Corporate Services includes Technology and Operations. (3) Included within average assets are average earning assets, which comprise deposits with other banks, deposits at central banks, securities borrowed or purchased under resale agreements, loans and securities. Total average earning assets for the three months ended July 31, 2026 are $1,379,889 million, including $349,292 million for Canadian P&C, $235,937 million for U.S. Banking, and $794,660 million for all other operating segments including Corporate Services (for the three months ended July 31, 2025 - Total: $1,287,815 million, Canadian P&C: $343,805 million, U.S. Banking: $230,849 million and all other operating segments: $713,161 million). Certain comparative figures have been reclassified to conform with the current period’s presentation. 66 BMO Financial Group Third Quarter Report 2026
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(Canadian $ in millions) Canadian Wealth Capital Corporate For the nine months ended July 31, 2026 P&C U.S. Banking (1) Management Markets (1) Services (1) (2) Total Net interest income $ 7,506 $ 6,874 $ 906 $ 1,793 $ (601) $ 16,478 Non-interest revenue 2,106 1,915 3,703 4,660 425 12,809 Total Revenue 9,612 8,789 4,609 6,453 (176) 29,287 Provision for credit losses on impaired loans 1,421 662 5 74 19 2,181 Provision for (recovery of) credit losses on performing loans 120 (86) (1) 4 (11) 26 Total provision for credit losses 1,541 576 4 78 8 2,207 Depreciation and amortization 533 680 198 238 – 1,649 Non-interest expense 3,661 4,471 2,834 3,533 1,613 16,112 Income (loss) before taxes and non-controlling interest in subsidiaries 3,877 3,062 1,573 2,604 (1,797) 9,319 Provision for (recovery of) income taxes 1,065 662 385 664 (326) 2,450 Reported net income (loss) $ 2,812 $ 2,400 $ 1,188 $ 1,940 $ (1,471) $ 6,869 Non-controlling interest in subsidiaries $ – $ 3 $ – $ – $ 2 $ 5 Net income (loss) attributable to bank shareholders $ 2,812 $ 2,397 $ 1,188 $ 1,940 $ (1,473) $ 6,864 Average assets (3) $ 348,396 $ 247,690 $ 57,861 $ 601,878 $ 279,965 $ 1,535,790 Canadian Wealth Capital Corporate For the nine months ended July 31, 2025 P&C U.S. Banking (1) Management Markets (1) Services (1) (2) Total Net interest income $ 7,203 $ 6,783 $ 746 $ 1,902 $ (643) $ 15,991 Non-interest revenue 1,869 1,825 3,202 3,726 320 10,942 Total Revenue 9,072 8,608 3,948 5,628 (323) 26,933 Provision for credit losses on impaired loans 1,456 801 3 96 41 2,397 Provision for (recovery of) credit losses on performing loans 259 123 3 107 (27) 465 Total provision for credit losses 1,715 924 6 203 14 2,862 Depreciation and amortization 472 745 161 244 – 1,622 Non-interest expense 3,453 4,391 2,398 3,235 452 13,929 Income (loss) before taxes and non-controlling interest in subsidiaries 3,432 2,548 1,383 1,946 (789) 8,520 Provision for (recovery of) income taxes 942 545 343 481 (221) 2,090 Reported net income (loss) $ 2,490 $ 2,003 $ 1,040 $ 1,465 $ (568) $ 6,430 Non-controlling interest in subsidiaries $ – $ 7 $ – $ – $ 2 $ 9 Net income (loss) attributable to bank shareholders $ 2,490 $ 1,996 $ 1,040 $ 1,465 $ (570) $ 6,421 Average assets (3) $ 343,543 $ 259,617 $ 53,038 $ 552,478 $ 277,446 $ 1,486,122 (1) Operating segments report on a taxable equivalent basis (teb). Net interest income, revenue and the provision for income taxes are increased on tax-exempt securities to an equivalent before-tax basis to facilitate comparisons of income between taxable and tax-exempt sources. The offset to the groups’ teb adjustments is reflected in Corporate Services net interest income, revenue and provision for income taxes. (2) Corporate Services includes Technology and Operations. (3) Included within average assets are average earning assets, which comprise deposits with other banks, deposits at central banks, securities borrowed or purchased under resale agreements, loans and securities. Total average earning assets for the nine months ended July 31, 2026 are $1,352,419 million, including $346,697 million for Canadian P&C, $228,772 million for U.S. Banking, and $776,950 million for all other operating segments including Corporate Services (for the nine months ended July 31, 2025 - Total: $1,305,339 million, Canadian P&C: $341,670 million, U.S. Banking: $238,149 million and all other operating segments: $725,520 million). Certain comparative figures have been reclassified to conform with the current period’s presentation. Note 13: Acquisitions and Divestitures Acquisitions Burgundy Asset Management Ltd. On November 1, 2025, we completed the acquisition of Burgundy Asset Management Ltd., a leading independent wealth manager in Canada, providing discretionary investment management for private clients, foundations, endowments, pensions and family offices. Burgundy operates as a wholly-owned subsidiary of BMO. The purchase price of $654 million comprised $61 million in cash, $481 million in shares of a wholly-owned subsidiary of BMO that were exchanged into BMO common shares on close, and $112 million of contingent consideration payable in similarly exchangeable shares. The $112 million of contingent consideration represents the fair value of a holdback to be paid subject to Burgundy maintaining certain assets under management 18 months post-close and the fair value of a potential earn-out, payable in the future based on the achievement of certain growth targets. The acquisition was accounted for as a business combination, and the acquired business and corresponding goodwill are included in our Wealth Management reporting segment. As part of this acquisition, we acquired customer relationship intangible assets valued at $375 million and goodwill of $319 million. Customer relationship intangible assets will be amortized over 12 years. Goodwill primarily reflects the expected future economic benefits from expanding our wealth advice and private investment counsel offering and is not deductible for tax purposes. BMO Financial Group Third Quarter Report 2026 67
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The fair values of the assets acquired and liabilities assumed at the date of acquisition are as follows: (Canadian $ in millions) November 1, 2025 Customer relationship intangible assets $ 375 Other assets 89 Total assets 464 Deferred tax liabilities 99 Other liabilities 30 Total liabilities 129 Goodwill 319 Purchase price $ 654 The purchase price allocation for Burgundy is subject to refinement as we complete the valuation of the assets acquired and liabilities assumed. Contingent consideration is remeasured at fair value each reporting period. The fair value of contingent consideration was remeasured to $198 million in the third quarter, and the resulting increases of $63 million and $86 million for the three and nine months ended July 31, 2026, respectively, were recorded as a reduction in non-interest revenue, other revenues. Changes in the fair value of the contingent consideration are not recognized for tax purposes. Euroz Hartleys Group Capital Markets Business On June 29, 2026, we entered into a definitive agreement to acquire the Australia-based metals and mining focused capital markets business of Euroz Hartleys Group Limited (Euroz Hartleys). This acquisition is expected to close in the fourth quarter of calendar 2026, subject to Euroz Hartleys shareholder approval, regulatory approvals and satisfaction of other customary closing conditions. Following closing, the acquired business will form part of the Capital Markets operating segment. The impact of this acquisition is not expected to be material to the bank. Divestitures Sale of Certain U.S. Branches On October 16, 2025, we entered into a definitive agreement to sell 138 BMO branches in select U.S. markets that are part of our U.S. Banking operating segment to First-Citizens Bank & Trust Company (First Citizens Bank). Under the terms of this agreement, First Citizens Bank will assume approximately US$5.3 billion (CAD$7.4 billion) in deposits and purchase approximately US$0.7 billion (CAD$1.0 billion) in loans as at July 31, 2026, for a net deposit premium of approximately 5 percent paid on closing. This transaction is expected to close in the fourth quarter of fiscal 2026, subject to regulatory approvals and customary closing conditions. As this transaction met the accounting requirements for assets held for sale, we recognized a write-down of goodwill of US$73 million (CAD$102 million) before and after-tax in the fourth quarter of 2025. In the second quarter of 2026, we recognized an additional write-down of goodwill of US$13 million (CAD$17 million) before and after-tax based on updated assumptions. The write- down is included in non-interest expense, other, in our Consolidated Statement of Income, reported in Corporate Services. These amounts are subject to closing adjustments, including fair values and foreign exchange rates prevailing at the date of closing. Sale of Transportation Finance and Vendor Finance Business On May 11, 2026, we entered into a definitive agreement with Stonepeak for the sale of BMO’s Transportation Finance and Vendor Finance businesses, including related loan portfolios which are part of our U.S. Banking and Canadian P&C operating segments, representing approximately US$9.2 billion (CAD$12.9 billion) and CAD$1.7 billion respectively, as at July 31, 2026. Stonepeak will acquire the assets of these businesses for cash consideration and an earn-out contingent upon the business achieving specified future performance targets. BMO will use a portion of the consideration to invest an approximate 19.9% equity interest in the new entity. As the transaction met the accounting requirements for assets held for sale, we recognized a charge of $1.1 billion pre-tax ($1.0 billion after-tax), primarily related to goodwill in the third quarter of 2026. The charge is included in non-interest expense, other, in our Consolidated Statement of Income and is reported in Corporate Services. The final amount is subject to closing adjustments and foreign exchange rates prevailing at the date of closing. This transaction is expected to close in the fourth quarter of fiscal 2026, subject to regulatory approvals and customary closing conditions. Subsequent Event Sale of Moneris Solutions Corporation On August 10, 2026, we, together with Royal Bank of Canada, entered into a definitive agreement with Francisco Partners for the sale of jointly-owned Moneris Solutions Corporation for cash consideration of approximately $2.0 billion, of which BMO’s share is 50%. We expect to record a gain on closing of approximately $620 million pre-tax ($600 million after-tax), which will be recorded in non-interest revenue, in our Consolidated Statement of Income, reported in Corporate Services. The transaction is expected to close by the end of the first quarter of fiscal year 2027, subject to regulatory approvals and customary closing conditions. 68 BMO Financial Group Third Quarter Report 2026
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Investor and Media Information Investor Presentation Materials Interested parties are invited to visit BMO’s website at www.bmo.com/investorrelations to review the 2025 Annual MD&A and audited annual consolidated financial statements, quarterly presentation materials and supplementary financial and regulatory information package. Quarterly Conference Call and Webcast Presentations Interested parties are also invited to listen to our quarterly conference call on Tuesday, August 25, 2026, at 7:15 a.m. (ET). The call may be accessed by telephone at 647-557-5533 (from within Toronto) or 1-888-440-4121 (toll-free outside Toronto), entering Passcode: 89709#. A replay of the conference call can be accessed until October 25, 2026, by calling 647-362-9199 (from within Toronto) or 1-800-770-2030 (toll-free outside Toronto) and entering Passcode: 89709#. A live webcast of the call can be accessed on our website at www.bmo.com/investorrelations. A replay can also be accessed on the website. Media Relations Contact John Fenton, Head, Public Relations, john.fenton@bmo.com, 416-867-3996 Investor Relations Contacts Christine Viau, Head, Investor Relations, christine.viau@bmo.com, 416-867-6956 Bill Anderson, Managing Director, Investor Relations, bill2.anderson@bmo.com, 416-867-7834 Shareholder Dividend Reinvestment and Share Purchase Plan (DRIP) Common shareholders may elect to have their cash dividends reinvested in common shares of the bank, in accordance with the bank's DRIP. More information about the Plan and how to enrol can be found at www.bmo.com/ investorrelations. For dividend information, change in shareholder address or to advise of duplicate mailings, please contact Computershare Trust Company of Canada 320 Bay Street, 14th Floor Toronto, Ontario M5H 4A6 Telephone: 416-263-9200 Fax: 1-888-453-0330 E-mail: service@computershare.com For other shareholder information, please contact Bank of Montreal Shareholder Services Corporate Secretary’s Department 1 First Canadian Place, 9th Floor Toronto, Ontario M5X 1A1 Telephone: 416-867-6785 E-mail: corp.secretary@bmo.com For further information on this document, please contact Bank of Montreal Investor Relations Department P.O. Box 1, 1 First Canadian Place, 37th Floor Toronto, Ontario M5X 1A1 BMO’s 2025 Annual MD&A, audited consolidated financial statements, Annual Information Form and annual report on Form 40-F (filed with the U.S. Securities and Exchange Commission) are available online at www.bmo.com/investorrelations, www.sedarplus.ca and at www.sec.gov. Printed copies of the bank’s complete 2025 audited consolidated financial statements are available free of charge upon request at 416-867-6785 or corp.secretary@bmo.com. Annual Meeting 2027 The next Annual Meeting of Shareholders will be held on Wednesday, April 14, 2027. ® Registered trademark of Bank of Montreal BMO Financial Group Third Quarter Report 2026 69