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BMO's overall net interest margin and adjusted net interest margin were relatively unchanged from the fourth quarter. On an adjusted basis, decreases in the P&C businesses were offset by increases in PCG and BMO Capital Markets.
Average earning assets increased $9 billion or 2% from the fourth quarter, including a $1 billion increase as a result of the stronger U.S. dollar. There was good growth across each of the operating groups.
Adjusted results in this section are non-GAAP amounts or non-GAAP measures. Please see the Non-GAAP Measures section.
----------------------------------------------------------------------------Adjusted Net Interest Margin on Earning Assets (teb)(i) Table 4---------------------------------------------------------------------------- Increase Increase (Decrease) (Decrease)(In basis points) Q1-2013 Q1-2012 vs Q1-2012 Q4-2012 vs Q4-2012----------------------------------------------------------------------------P&C Canada 265 292 (27) 268 (3)P&C U.S. 421 447 (26) 430 (9)----------------------------------------------------------------------------Personal and Commercial Banking 305 334 (29) 310 (5)Private Client Group 290 383 (93) 285 5BMO Capital Markets 59 62 (3) 55 4Corporate Services, including T&O(ii) nm nm nm nm nm----------------------------------------------------------------------------Total BMO adjusted net interest margin (1) 167 185 (18) 167 ---------------------------------------------------------------------------------------------------------------------------------------------------------Total BMO reported net interest margin 185 205 (20) 183 2----------------------------------------------------------------------------Total Canadian Retail (reported and adjusted)(iii) 265 292 (27) 267 (2)----------------------------------------------------------------------------(i) Net interest margin is disclosed and computed with reference to average earning assets, rather than total assets. This basis provides a more relevant measure of margins and changes in margins. Operating group margins are stated on a taxable equivalent basis (teb) while total BMO margin is stated on a GAAP basis.(ii) Corporate Services adjusted net interest income is negative in all periods and its variability affects changes in net interest margin.(iii) Total Canadian retail margin represents the net interest margin of the combined Canadian business of P&C Canada and Private Client Group.(1) These are non-GAAP amounts or non-GAAP measures. Please see the Non- GAAP Measures section.nm - not meaningful
Non-Interest Revenue
Non-interest revenue increased $66 million or 4% from the first quarter a year ago to $1,865 million. Adjusting items in non-interest revenue relate to the run-off of structured credit activities, which are reflected in trading revenues. Adjusted non-interest revenue increased $206 million or 13% to $1,857 million. There was a significant improvement in underwriting and advisory fees, primarily mergers and acquisitions and debt underwriting fees. Insurance revenues also improved significantly, due to the reduced impact of movements in long-term interest rates in the current quarter relative to a year ago and business growth. There was good growth in mutual fund revenues and lending fees, with more modest increases in card services and adjusted trading revenues.
