Key Takeaways

• The Bank of Montreal's third-quarter earnings fell short of analysts' estimates as profits declined across several segments, including personal and commercial banking in the U.S. and Canada.

• Overall, profits increased year-over-year despite lower revenue, as CEO Darryl White said the bank practiced "good cost discipline."

• The bank's shares moved lower in early trading Tuesday after the earnings report was released.

Canada's Bank of Montreal (BMO) missed estimates for its third-quarter results Tuesday, as profits declined across a number of the bank's divisions and it nearly doubled provisions for credit losses (PCL) compared to last year.

BMO posted 1.87 billion Canadian dollars ($1.39 billion) in net income, short of analyst estimates compiled by Visible Alpha, on C$8.19 billion in total revenue. The bank reported C$4.79 billion in net interest income (NII), narrowly below estimates, while PCL rose to C$906 million, compared to C$496 million in the same period last year.

Profit Declines Across Several Segments

Profits declined across a number of BMO's segments, including personal and commercial banking in the U.S. and Canada, along with the bank's wealth management business. Those declines were offset by improved results in BMO's global markets and investment-related activities, thanks to "higher trading, underwriting and advisory, and corporate banking-related revenue, as well as lower expenses and a higher provision for credit losses."

Despite the lower overall revenue, the bank managed to increase its profits year-over-year, which CEO Darryl White said reflects the bank's "good cost discipline and the sustained strength of our operating performance."

Bank of Montreal shares were down 5.5% at $83.93 in early trading Tuesday following the company's earnings release, and have lost about 15% of their value since the start of the year.

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