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BMO Leads Canadian Banks’ Dividend Bonanza With 25% Increase

  • Lender’s plan to buy back 3.5% of shares also tops industry
  • National Bank comes in second, with 23% dividend increase
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Photographer: Brent Lewin/Bloomberg
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Bank of Montreal raised its dividend 25% and announced its intention to buy back 3.5% of its shares, leading an avalanche of capital-return plans by Canada’s banks after being freed from pandemic-era payout restrictions.

Bank of Montreal’s outsize payouts reflect its strong earnings performance since the country’s banking regulator froze dividends and temporarily banned buybacks in March 2020 to protect the financial system. The lender benefited from its diversification, including a large presence in the U.S. as well as in Canada, where the hot housing market has supported mortgage lending, and its large capital-markets business, which has benefited from heightened trading and dealmaking activity throughout the pandemic.