Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Equities  >  Toronto Stock Exchange  >  Bank of Montreal    BMO   CA0636711016

BANK OF MONTREAL

(BMO)
  Report  
SummaryQuotesChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsPress ReleasesOfficial PublicationsSector newsAnalyst Recommendations

Canada's banks face intensifying scrutiny of sales practices

share with twitter share with LinkedIn share with facebook
share via e-mail
0
03/15/2017 | 12:21pm EDT

TORONTO (Reuters) - Canada's banks faced intensifying scrutiny on Wednesday after the country's financial watchdog launched an investigation and lawmakers called for a parliamentary inquiry following media reports suggesting improper sales practices at certain banks.

Financial Consumer Agency of Canada (FCAC) Commissioner Lucie Tedesco expressed concern over the reports by CBC News that employees at some of the country's largest banks had opened accounts for products and services for consumers without properly obtaining their expressed consent, an issue the regulator said it will focus on in a review to begin in mid-April.

Canadian banks have until now avoided the consumer mis-selling scandals that had affected banks in the United States and Europe in recent years. However, some analysts said banks in Canada have therefore been subject to lighter regulatory scrutiny, enabling them to engage in sales practices no longer deemed acceptable elsewhere.

The banks named by in the reports by CBC News have all subsequently defended their sales practices.

"The lack of scandals has led to Canada avoiding the regulatory scrutiny of sales practices seen in other markets, in particular the UK. We think this could now change, putting some pressure on profitability," said Citi analyst Stefan Nedialkov.

British banks have so far paid out more than 24 billion pounds ($29 billion) compensating customers who were mis-sold loan insurance and Spanish banks face a bill of nearly 4 billion euros ($4.25 billion) after a 2013 court ruling that they sold mortgages to around 1.5 million customers without explaining interest rates could not fall below a certain level.

Sales practices at banks in the United States have come under scrutiny after Wells Fargo & Co (>> Wells Fargo & Co) reached a $185 million settlement in September with U.S. authorities after admitting branch staff had opened up to 2 million unauthorized customer accounts amid pressure to meet internal sales goals.

Two lawmakers who sit on Canada's House of Commons Standing Committee on Finance said on Wednesday that banks' business practices and the effectiveness of financial regulation in Canada should be examined by the committee.

"Is it adequate enough? Do they have enough power?," asked Liberal MP Robert-Falcon Ouellette. "Part of our role is not only to hold the government to account but the entire financial system."

Conservative MP Dan Albas called on the FCAC and Canada's finance ministry to explain how they are responding to the concerns and to address questions around the effectives of regulators.

"I'd like to see the Minister of Finance (Bill Morneau) tell us whether he believes the current framework works," he said.

Canada's finance ministry reiterated on Wednesday it was confident the FCAC would examine the issue carefully.

CBC News had reported last week that customers of Toronto-Dominion Bank (>> Toronto-Dominion Bank) were moved to higher-fee accounts or had their overdraft and credit card limits increased without their knowledge after staffers came under pressure to meet sales targets.

On Wednesday, CBC News reported that employees at the nation's other biggest banks - Royal Bank of Canada, Bank of Montreal, Canadian Imperial Bank of Commerce and Scotiabank - said they had engaged in similar practices.

The banks have all defended their practices.

Royal Bank of Canada (>> Royal Bank of Canada) said in a statement that its employees "embrace the responsibility of putting our clients' needs at the center of all we do."

Bank of Montreal (>> Bank of Montreal) said in a statement it is committed to "putting customers and employees first" and Canadian Imperial Bank of Commerce (>> Canadian Imperial Bank of Commerce) said its staff are "incentivized to do what is right for our clients."

Bank of Nova Scotia (>> Bank of Nova Scotia) said in a statement that all employees are "focused on the needs of our customers."

TD has defended its practices.

Shares in Scotiabank and Bank of Montreal were down 1 percent on Wednesday. Shares in CIBC fell 0.7 percent. Shares in TD and RBC were down 0.3 percent.

(Additional reporting by Leah Schnurr; Editing by Jeffrey Benkoe and Meredith Mazzilli)

By Matt Scuffham

Stocks mentioned in the article
ChangeLast1st jan.
BANK OF MONTREAL 0.41% 97.21 Delayed Quote.8.57%
CANADIAN IMPERIAL BANK OF COMMERCE 0.32% 110.56 Delayed Quote.8.39%
ROYAL BANK OF CANADA 0.02% 107.02 Delayed Quote.14.53%
THE BANK OF NOVA SCOTIA 0.12% 75.62 Delayed Quote.11.07%
THE TORONTO-DOMINION BANK 0.08% 74.35 Delayed Quote.8.69%
WELLS FARGO & COMPANY -1.10% 49.635 Delayed Quote.8.75%
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on BANK OF MONTREAL
10/15BANK OF MONTREAL : BMO Insurance to Offer Advance Payment of Life Insurance Bene..
AQ
10/11BANK OF MONTREAL : BMO Financial Group Celebrates 2019 International Day of the ..
AQ
10/10BANK OF MONTREAL : BMO Insurance Launches Enhanced Market Indexed Account Exclus..
AQ
10/10365 DAYS IN : BMO Business Xpress Has Helped Thousands of Canadian Small Busines..
AQ
10/08BANK OF MONTREAL : Master Credit Card Trust II Announces it has Applied to Cease..
AQ
10/07BANK OF MONTREAL : BMO Donates $5 Million to University of Toronto to Launch Fir..
AQ
10/07BANK OF MONTREAL : R E P E A T -- Media Advisory - BMO and University of Toronto..
PU
10/07BANK OF MONTREAL : American Banker names BMO Harris Bank leaders the "Most Power..
PU
10/07BANK OF MONTREAL : Media Advisory - BMO and University of Toronto to Announce Fi..
PU
10/02BANK OF MONTREAL : Three Phoenix women honored by BMO Harris Bank
PU
More news
Financials (CAD)
Sales 2019 22 985 M
EBIT 2019 8 808 M
Net income 2019 5 958 M
Debt 2019 -
Yield 2019 4,20%
P/E ratio 2019 10,4x
P/E ratio 2020 10,0x
Capi. / Sales2019 2,69x
Capi. / Sales2020 2,61x
Capitalization 61 878 M
Chart BANK OF MONTREAL
Duration : Period :
Bank of Montreal Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends BANK OF MONTREAL
Short TermMid-TermLong Term
TrendsBullishBearishNeutral
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 15
Average target price 102,93  CAD
Last Close Price 96,83  CAD
Spread / Highest target 14,6%
Spread / Average Target 6,30%
Spread / Lowest Target -4,99%
EPS Revisions
Managers
NameTitle
Darryl White Chief Executive Officer & Director
J. Robert S. Prichard Chairman
Steven Tennyson Chief Operations Officer & CTO
Thomas E. Flynn Chief Financial Officer
George Alexander Cope Independent Director
Sector and Competitors