BMO Financial Group in Montreal sold a U.S. credit card portfolio as part of a broader balance sheet optimization strategy.
The Canadian company disclosed during its quarterly conference call that it sold a non-relationship credit card portfolio and exited a franchise loan portfolio. BMO said it lost $51 million from selling the card portfolio; it did not disclose the buyer.
Selling the card portfolio should “support the recycling of capital to higher return opportunities,” Tayfun Tazun, BMO’s chief financial officer, said during the call. The franchise loan portfolio “did not meet our return expectations with minimal impact on current net income.
BMO is in the midst of an effort to generate a 12% return on equity in its U.S. business.