BMO Revamped U.S. Operations After 2023 Acquisition
The bank unified its leadership structure and divested underperforming assets to improve U.S. profitability.
Updated on Sept. 25, 2026 in Corporate Finance
Live Poll
Do you trust large national banks to maintain quality service after major mergers and closures?
BMO Financial Group reorganized its U.S. operations following the 2023 acquisition of Bank of the West, with return on equity reaching 9.2 percent in the third quarter of 2026. The bank implemented a unified management structure to streamline its personal, commercial, and wealth management businesses.
Why it matters
This shift aims to reverse performance challenges encountered post-acquisition by shedding low-growth loan portfolios and branch networks. The reorganization centralizes decision-making to drive efficiency after U.S. return on equity dropped to 3.1 percent in late 2024.
BMO reported a 9.2 percent return on equity in the U.S. during the third quarter of 2026, up from 3.1 percent in the fourth quarter of 2024. The bank previously faced an efficiency ratio of 69.4 percent in the fourth quarter of 2023.
The players
BMO Financial Group
A major financial services provider headquartered in Canada that operates a significant banking network across the United States.
Aron Levine
A senior leader who joined BMO in June 2025 to help guide the firm's U.S. business strategy.
The details
BMO consolidated its previously fragmented consumer, commercial, and wealth teams into a singular leadership structure to reduce overhead. Simultaneously, the bank divested 138 branches across the Midwest and Great Plains while exiting specific loan portfolios. These moves were designed to pivot resources toward higher-growth areas, such as the planned opening of 6 branches in California in October 2026 and 27 additional locations throughout 2027.
Timeline
BMO acquired Bank of the West in 2023.
U.S. return on equity fell to 3.1 percent in Q4 2024.
Aron Levine joined the firm in June 2025.
U.S. return on equity rose to 9.2 percent in Q3 2026.
The target date for reaching a 12 percent return on equity is October 31, 2027.
Market Landscape
This reorganization follows the integration challenges experienced by BMO after the 2023 acquisition of Bank of the West. It reflects a common industry pattern where rapid expansion necessitates a later phase of cost-cutting and portfolio pruning to restore profitability metrics.
Operators should monitor BMO's branch expansion plans in California for signals on where the bank is prioritizing deposit growth. Owners should track whether the 12 percent return on equity target is met by October 2027 as a benchmark for successful institutional turnaround strategies.
The takeaway
Large-scale acquisitions often require a painful period of rationalizing assets and management structures to realize intended value. Keep a close watch on your own efficiency ratios when integrating new business units or assets to ensure overhead growth does not outpace revenue gains.
Further reading
For more on how banks manage post-merger integration, see Corporate Finance.
Source note: This article includes information reported by American Banker.
Live Poll
Do you trust large national banks to maintain quality service after major mergers and closures?
