Canadian banks also prospered, but in a regulated and noncompetitive atmosphere. Canadian law limited the interest banks could charge on their loans to 6 percent, and power in the banking industry was concentrated in a group of five major banks, of which the Bank of Montreal was one.
During this time, however, the Bank of Montreal also earned itself a reputation for stodginess and an unwillingness to adapt to change. In the mids its earning performance began to weaken. Then, in , an amendment to the Canadian Bank Act eliminated the interest-rate ceiling, opening up new opportunities in the area of consumer and small-business lending. The Bank of Montreal was caught unprepared to keep pace with its competitors.
Its financial performance was further eroded by a costly but necessary computerization program. The Bank of Montreal's accounting procedures seemed not to have changed much since the age of the quill pen; when CEO Fred McNeil assumed his post in , he asked a personnel department executive for a copy of the departmental budget and the executive replied: "Budget? No one has ever asked us to prepare one. In the bank started a credit card program, and the start-up costs added even more financial liability.
The Bank of Montreal was the last of Canada's five major banks to bring out a credit card. Mulholland was an American. Formerly a partner at the prominent investment bank Morgan Stanley, in he was named president of Brinco Limited, a Canadian mining company.
After taking the top job at the Bank of Montreal, he dodged the controversy over an American heading up one of Canada's largest banks by promising to consider adopting Canadian citizenship.
Mulholland's aggressive and uncompromising management style was once described as "chewing through underlings with a chainsaw" by Canadian Business magazine, and a number of senior executives left the bank during his tenure. But the bank's condition also improved immediately after he took office.
Mulholland closed down 50 unprofitable branches during his first five years in office, revised the Bank of Montreal's internal pricing system to reflect the cost of funds more accurately, and modernized procedures for asset and liability management. He was also unafraid to bring in outside help, as he did when he recruited IBM executive Barry Hull to get the computerization program on track. The bank opened its first computerized branch office in , and all 1, of its branches were plugged into the computer system by The Bank of Montreal also sought to internationalize under Mulholland, joining a trend in which just about every one of the world's major financial institutions participated since the late s.
In it purchased a Also in , the Bank of Montreal tried to expand into the American retail banking market when it began negotiating the acquisition of 89 branch offices from Bankers Trust Company.
Mulholland forged ahead with the deal despite analysts' misgivings, but negotiations broke down in and the deal was never consummated. The Bank of Montreal suffered in the early s under the strain of loans to Latin America and to oil and real estate interests in western Canada that went sour. But two years later, the analysts had changed their opinion entirely. The Harris acquisition made the Bank of Montreal one of the leading foreign institutions involved in U.
The strong performance of regional bank stocks in and also made the deal seem like a bargain in retrospect. In , the Progressive Conservative government of Prime Minister Brian Mulroney decided to deregulate Canada's financial system, a move that blurred the traditional lines between insurance, banking, and securities brokerage. Companies that had been restricted to one business were allowed to diversify into others, increasing competition among individual firms but also the power of holding companies seeking to build financial service empires.
One immediate consequence of deregulation was a surge in merger-and-acquisition activity involving Canadian securities firms. Growing foreign investment in North America helped accelerate this trend, as did an increasing demand for stocks among domestic small investors one brokerage executive told Barron's: "It wasn't too long ago that the average Canadian's idea of a balanced portfolio was a savings bond and a lottery ticket".
The Bank of Montreal responded by acquiring Nesbitt Thomson, Canada's fourth-largest brokerage firm, in William Mulholland made way for a younger successor, Matthew W. Barrett, in However, the bank continued in the direction Mulholland had set for it. It grew in Canada, offering more services, and expanded across the border, mostly through its Harris Bancorp subsidiary.
In , the bank announced a major push to grow Harris. Harris got a new CEO that year, whose job was specifically to oversee the expansion plan. By , Harris accounted for about 30 percent of Bank of Montreal's earnings. The parent company thought that figure could rise to 50 percent over the next decade. The plan called for increasing Harris's presence in the Chicago area and in seven surrounding states. James Theatre in Interestingly, the building also housed the Montreal offices of the White Star Line from to That is where tickets for the RMS Titanic were sold.
Among the many Montrealers who perished aboard the Titanic was Harry Markland Molson who sat on the board of directors for the Molson Bank. Today, the building is home to LHotel Montreal. The architecture of the building is French Second Empire and the restoration of many original architectural elements — such as the ceiling friezes in the Entrance Hall — help preserve the spirit of the 19th century. The bank was purchased by the Bank of Montreal in Founded in Halifax in , Nova Scotia bank moved its headquarters to Toronto in to improve the transatlantic trade industry.
The bank has over 8 million clients in Canada and almost branches. The bank has over 42, employees worldwide as of Q2 of The bank has over 11 million clients worldwide, 1, branches in Canada and over 44, full-time employees worldwide.
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