Good afternoon. And welcome to the BMO Financial Group's Q3 2014 Earnings Release Conference Call for August 26, 2014. Your host for today is Ms. Sharon Haward-Laird, Head Investor Relations. Ms. Haward-Laird, please go ahead.

Thank you, operator. Good afternoon, everyone and thanks for joining us today. Our agenda for today's investor presentation is as follows. We will begin the call with remarks from Bill Downe, BMO's CEO; followed by presentations from the Bank's Chief Financial Officer, Tom Flynn; and our Chief Risk Officer, Surjit Rajpal. After their presentations, we will have a short Q&A period where we will take questions from prequalified analysts. To make sure everyone has an opportunity to participate, please keep it to one question and then re-queue. Also with us this afternoon are Frank Techar, Chief Operating Officer; Cam Fowler from Canadian P&C; Mark Furlong from U.S. P&C; Tom Milroy from BMO Capital Markets; and Gilles Ouellette from Wealth Management. On behalf of those speaking today, I note that forward-looking statements may be made during this call. Actual results could differ materially from forecasts, projections or conclusions in these statements. I would also remind listeners that the bank uses non-GAAP financial measures to arrive at adjusted results to assess and measure performance by business and the overall bank. Management assesses performance on a reported and adjusted basis and considers both to be useful in assessing underlying performance. Bill and Tom will be referring to adjusted results in their remarks, unless otherwise noted. Additional information on adjusting items, the bank's reported results and factors and assumptions related to forward-looking information can be found in our Annual Report and in our third quarter report to shareholders. And now I’ll hand things over to Bill.

Thank you, Sharon, and good afternoon everyone. BMO delivered very good results in the third quarter confirming continued momentum across our businesses. Net income was up 4% from strong results a year ago. Personal and commercial banking in Canada had continuing strong performance with operating leverage above 2%. Year-to-date earnings were up 10%. Net income and pre-provision prê-tax earnings in U.S. Personal and Commercial Banking was encouraging, with improved revenue trends despite the continued low interest rate environment. Traditional wealth posted net income growth of 27% reflecting good organic growth in client assets and the acquired F&C business. And there were very good results in BMO capital markets driven by strong revenue growth in investment and corporate banking. Wealth and capital markets provide valuable diversification to our business mix. After slowing early this year due to the harsh winter, the North American economy has rebounded. In Canada consumer spending has improved and is expected to grow moderately, while business investment is expected to strengthen in response to firmer exports supporting commercial credit growth. In the U.S., consumer and business spending also strengthened from a year ago. Economic conditions have historically been much stronger in prior recoveries but they have gradually improved over the last five years and against this backdrop, BMO's operating groups have delivered very good performance with earnings per share up 8% year-to-date. I'll now touch on a few highlights from our third quarter. Net income was $1.2 billion or $1.73 per share. Revenue grew 10% to $4.2 billion and ROE was 15%. Loans were up 9% and deposits increased 11% from a year ago. Credit performance in the quarter continued to be good and Surjit will provide more detail later in the call. BMO's common equity Tier 1 ratio was 9.6% which includes the anticipated impact of…

Thanks, Bill, and good afternoon everyone. I’ll now go through our results starting on Slide 8. Q3 was a very good quarter with EPS of $1.73 and net income of $1.2 billion, both up 4% from a strong Q3 last year. Q3 of last year had very low credit losses and the benefit in our insurance business summarizing long term rates versus a rate charge in the current quarter. Excluding the rate impacts and net credit related items, underlying earnings growth within the double digits. Our operating groups continued to perform well this quarter. The strong results in P&C Canada, BMO Capital Markets and Traditional Wealth, and improved results in U.S. P&C. Adjusting items are similar in character to prior quarters and this quarter includes F&C acquisition integration cost of $7 million after tax, which are reported in the Wealth Management segment. Revenue was up 10% from last year to $4.2 billion, driven mainly by good organic growth and also by the addition of F&C and the stronger U.S. dollar. Net interest income was up 4% year-over-year driven by volume growth, purchased performing loan revenue and the impact of the stronger U.S. dollar partially offset by lower net interest margin. Net interest income was up 2% sequentially in large part due to three more days in the current quarter. BMO’s overall net interest margin excluding trading was stable quarter-over-quarter. Non-interest revenue was up 16% from last year with increases across most categories. Insurance income was lower year-over-year due to the impact of long term rates. Q3 expenses were $2.7 billion, up 11% from last year. The increase reflects higher employee related expenses, the impact of F&C, higher technology and support costs related to a changing business and regulatory environment and the stronger U.S. dollar. Expenses were up 5% from Q2…

Thank you, Tom and good afternoon everyone. We had another good quarter from a risk perspective. Starting on Slide 17, PCLs were $130 million, a decrease of $32 million from the prior quarter. The decrease was largely due to impaired loan sales in the U.S. In P&C Canada, both consumer and commercial losses were flat quarter-over-quarter. In P&C U.S., commercial losses were down compared to the previous quarter while consumer losses increased by $10 million. The increase in the consumer losses was mainly due to methodology changes, absent which consumer losses would have also decreased. The recovery in the corporate portfolio increased by $28 million due to impaired loan sales. Moving to the next slide, formations of $457 million down $52 million from the prior quarter with the reduction coming from commercial portfolio’s in both Canada and the U.S. Growth impaired loans also decreased this quarter to below $2 billion because of the U.S. loan sales and a reduction in commercial formations. In summary, we had solid credit performance reflective of good underlying trends and the success we had in selling impaired loans. Looking to the next quarter, I expect continued good credit performance with less benefit though, from loan sales. I will now turn it over to the operator for the question-and-answer portion of today’s presentation.

Thank you. (Operator Instructions) Our first question is from Robert Sedran from CIBC World Markets. Please go ahead.

Hi, good afternoon. Tom, you went a fair bit of the way in explaining the drop in risk-weighted assets, although I guess all else equal, the currency probably would have inflated that number, so the decline is even larger. When I look at a smaller decline in average earning assets, is that the similar phenomenon at play in terms of optimizing the balance sheet in shrinking some of the less productive assets? And is there a lasting revenue impact from some of that activity?

Thanks for the question, a few things. I'll address the last part of it first. We’re not expecting any lasting revenue impact from the things that we did during the course of the quarter. There were some connection between the change in risk weighted assets and the change in the balance sheet that you see quarter-over-quarter, as you have mentioned. The currency quarter-over-quarter actually reduced the RWA a little bit. It was not significant. But it was about $500 million from a lower spot rate on a currency quarter-over-quarter. And then the big driver related to the three items that I alluded to in my comments, book quality, improved - our book size improved as it's used to calculated risk weight assets, and we had one methodology change. So those were the largest drivers. And I guess last thing I'd add is that market risk itself was down about a $1 billion as well.

Now, I'm not sure if it was you or Bill, but in your comments you linked the closing of the F&C acquisition with some of the activities to improve the ratio. That mitigating impact, were they explicitly linked? And I know this is a tough question to answer, but are we -- is there something magical about 9.5 or what level you decided to take this to that was linked at that acquisition?

I'd say, we wish we could predict the ratio with that much precession. There is a degree of inherent movement in the ratio quarter-over-quarter and a lot of moving pieces. So we weren’t targeting a number with that degree of precession. But we absolutely did look at some of our physicians and the way that we had capital allocated out in areas given the reduction to the ratio that F&C produced and gave some of our activities a bit of a scrub to free up capital capacity to accommodate the acquisition of F&C. So I'll give you a little flavor for that. We did look at unused commitments and authorizations, places where we had capital available for clients, but they were not using it and shapes those lines and authorizations a bit in a way that had not client impact and freed up some capital. We sold some legacy securitization positions. No big impact on the P&L but it did free up some capital. And during the quarter, we purchased some mortgage insurance which is helpful both from a capital and a liquidity perspective. So, we did go through and did some additional work this quarter given the impact of the close of the acquisition and that came through and helped the ratio as it settled in at the end of the quarter.

Sounds like a busy summer. Thanks.

Thank you. Our next question is from Sumit Malhotra from Scotia Bank. Please go ahead.

Thanks, good afternoon. Maybe to start by following up on the last topic of conversation. Last quarter I think it was mentioned, Bill, that 9.5% was a level the bank wanted to get back to you before thinking about, what I'll call more than normal course capital deployment, things like share purchases and other levers. I think you got there at least faster than I expected. Wanted to get an update from you as to whether you feel you're where you need to be from a capital perspective to perhaps think about restarting share repurchases or other areas. Or is there a buffer you would like to have before that begins?

Thanks for the question, Sumit. I think what we talked about in the last call, if my recollection is correct, as the comfortable range being between 9.5% and 10% and that's all other things being equal. And by that I mean, there still is evolving discussion globally around where Basel III and other capital regimes will come to rest. But I think that range still seems to us to be the appropriate range. As you think of our track record of thinking in advance about acquisition, having the ability to build up excess capital in anticipation and then quickly recover stands on record. The acquisition of M&I, we approached that transaction with very strong capital begin with and we build capital faster than many had anticipated. And in the case of F&C, I think we did the same kind of discipline and as Rob observed, it was a busy summer but we really had anticipated the impact of the transaction pretty clearly. So I think that, as I said in the last call, at this point on organic growth because the best application for retained earnings and additional capital is to support growth of the balance sheet and the businesses. And as we look across all four business groups, we are really at a time where if the economy does expand, the businesses are well positioned. And I think they will absorb much of the capital that they we generate and that would be the first choice as we've said. We are judicious in using share buybacks when we don't have unidentified expectation of either robust organic growth or something that really might compliment one of the businesses. And then we have a dividend policy that really commits to return earnings to the shareholders in the form of dividends as revenue growth. So, I think its all part of a pretty well articulated framework for thinking about this and being in the range of 9.5 to 10 is a good place to be in order to have flexibility in all of those areas.

Thank you for that answer, and maybe to end off back to Tom for a moment, a similar topic. Do you feel, Tom, it certainly seems like with the differing banks on a quarterly basis there can be ups and downs as far as model refinements and balance sheet optimization are concerned from a capital perspective. BMO has had some benefits in this regard a couple times as of late, and I wanted to just hear from you as to whether you think there are further opportunities to contain or manage down the RWA level through either divestitures or refinements to the process, or do you think it's more of a normal course situation from where you stand now? Thanks.

I would view it as more of a normal course situation looking forward. We came out of this quarter with a ratio that was a little ahead of expectations. We're pleased with that. It does reflect some work over the summer and looking forward I would expect that same kind of trend that we’ve shown over a longer period of time versus what you saw this quarter.

And if I say 15 to 20 basis points in normal course accretion on a quarterly basis, that's consistent with the range you would envision?

That would be consistent. 15ish to maybe 20 is how I would put in.

Thank you, sir.

Thank you. Our following question is from John Haggan from Barclays. Please go ahead.

Good afternoon. Was just hoping that you could give us an update on F&C and where things stand right now in terms of the integration and what you have been -- how the discussions have been ongoing with the strategic partners. And just point of clarification, in Tom's commentary, when we talked about the 10% that comes from total Wealth Management, not just what you classify as the traditional Wealth Management?

Thanks John. The F&C acquisition closed three months ago. And after the first quarter it's really going, but we hit all our numbers on financials. The employees seem to be - pretty happy with the transaction, there hasn’t been any - certainly haven’t loss anybody from the Investment Management team. With the clients exception of the one strategic partner who declared in February before he closed the transaction, that they were going to be leaving at the end of the calendar year, all the clients seem to be happy. And we've been building the book pretty well in the first quarter. I am pretty pleased with the net inflows in the first quarter. I think I had mentioned when we first did the transaction that the real value creation here was going to be from us, being able to sell the F&C products to the North American client base. And at the same time selling the North American product to the European client base and that's all in motion. We've had training sessions with all of the North American Relationship Managers with respect to the F&C products. And at the same time we’ve had the - all the training sessions with the F&C Relationship Managers with respect to the North America products. And the pipeline is building. So we’re pretty happy with what's happening. And let's say after it, this quarter is pretty early but certainly it seems to be hitting on every cylinder. And you’re right with respect to the 10% that Tom was mentioning, that's for the whole Wealth Management business. It's obviously growing this business to a much larger part of BMO. In terms of - with F&C going forward, we’re now looking at a quarterly number – a sustainable quarterly number somewhere between 235 million to 245 million. And if we can keep growing organically I’d say, the 18%, 19% and 20% which we’ve been doing for the last couple of years, I mean that numbers can grow pretty quickly.

Great, thanks.

Thank you. Our next question is from Darko Mihelic from RBC Capital Markets. Please go ahead.

Hi, thank you. My first question is with respect to the growth in the Canadian P&C non-interest revenue. I wonder if you can highlight what it was that gave you a CAD43 million quarter-over-quarter bump. But is there any items in there, and what specifically helped to grow that quick? And then the second question relates to card revenues, and if you can provide some sort of a break down between what is annual fee and what is interchange related, that would be very helpful, thank you.

Darko, it's Cam Fowler, thanks for the questions. I'll start with the NER (ph). The increase in NER is driven by what I would characterize as a broad based set of numbers. We've got growth in retail products and investment products, card products and the commercial business, all contributing there. You asked if there was anything beyond that. There is a small security gain in there. But on balance the vast majority of that activity is underlying core growth but I think is sustainable. On the card side, can I just double check your question? Was your question a distinction between interchange versus fees?

Yes, please.

I think that the way I would characterize the activity in our cards business is that, we are pleased with what we’re seeing, I would say across the board. Originations had been the priority as you know we’re focused on the premium business here. And those originations have been very, very strong at multiples of past years. Balance growth is coming on. We had seen fee growth in the business and I would say that – I don’t think I can give you a specific number on the difference between the fee growth and the interchange but I think both are at or above where we would expect them to be right now.

Okay. Thank you.

Thank you. Our following question is from Steve Theriault from Bank of America Merrill Lynch. Please go ahead.

Thanks very much. Question for one or both if Tom Milroy or Tom Flynn. Just wanted to delve into the teb offset for a second, so it was relatively large again this quarter. I suspect that's at least a driver of why equity trading was so strong this quarter. Last quarter you mentioned, Tom, several large client-related transactions. Is that what we're seeing again here in Q3? Can you tell us much about the nature? And having seen these for a couple of quarters, I'm wondering if they're becoming less one-off or more regular?

Thanks Steve, its Tom Milroy. There is two buckets of activity that impacted TEB. And the first one is securities that we hold related to client transactions. And those revenues I would view as being recurring revenue stream. And the second ones are the ones we talked about last quarter which were our client related transactions that are periodic in nature and therefore not as predictable. The firmer is historically well over 50% of the TEB revenue. So, and you’re right. In this quarter - in the equity derivatives line, we benefited from some of that activity.

But there's no particular ramping of the latter category, it just so happens we've seen a couple quarters of --

It comes and goes, so you can have a quarter with nothing and then quarter with a couple of transactions.

Okay. Thanks for that.

Thank you. Our following question is from Mario Mendonca from TD Securities. Please go ahead.

Bill, if we could go back to F&C for a moment. You referred to what's already been essentially announced, like a preannounced loss of one particular strategic partner, and I want to make sure I understand what you're referring to here. Are you referring to the loss of assets in October 2014 of about GBP15 billion, is that what you were referring to?

I'm referring to that client. That is the one client. And we don't expect is October, expect more like December. So it’s not going to impact the numbers this year. But it will next year. But having said that, I think we have mentioned in the past that the revenues are of strategic partners that consider less than what we’re getting out the rest of the business. So it's not going to have the same portion of impact on the revenues than it will have on the AUM. We've had discussions with the other strategic partners, and I think there is some opportunities here to build the business with the other ones. I think the circumstances around this one were quite unique. I think it's some other things going on in a friends life that brought this about – sure thing wasn’t performance, as the whole unit is performing from an investment point of view is performing extremely well.

I think you addressed the second part of my question, which was essentially is there anything else going on in strategic partners beyond this £15 billion that you would say is at risk, or would you say you've got that mostly under control?

Well we've had extensive conversation with them. And we think that, we can say it’s under control but we think that we have a good relationship with them. And the dialogue has been more about building the relationship rather than ending it. :

Okay, and then just finally, and this is more of a housekeeping question. Were there any interest recoveries in the US business that may have affected the margin this quarter, or was it not material?

Yeah, this is Mark Furlong. We did have some interest recoveries. We have them every quarter and we had maybe couple of million more this quarter than last but we have some every quarter.

What would it have done to the margin this quarter in terms of what would it have added to the margin, the NIM that you disclosed?

I don't think I have that handy but it’s a couple of million more than last quarter. Not $10 million but just a couple.

Thank you.

Thank you. Our next question is from Peter Routledge from National Bank Financial. Please go ahead.

I guess a question for Mark, just on the U.S. business I noticed your adjusted operating leverage went positive for several quarters. And I think the question behind that is, looking at your adjusted net income kind of flat in the sub pack over the last couple of years. When will we get lift-off in this business? Where we see 10% year-over-year earnings growth consistently positive operating leverage?

Good question. As you know we've [woven] (ph) down a run-off portfolio in the commercial side. And that's getting pretty small now. We’re winding down the rest of 15. And we went through a little margin compression due to some competition. And while we’ll continue to see a little bit of compression over the course of the next year, so nothing like what we’ve faced this year. But I guess that what I’d say is we have a positive operating leverage this quarter. I think next quarter we’ll see some of the same on a year-over-year basis. We have a good commercial growth and good business banking growth this quarter. And I think the performance in the quarter was pretty good and I expect we’ll continue to see that. The revenue trends were encouraging and I think that’s going to continue to be a big positive for us. The other side we’re investing in the business and we’re into our mortgage and home equity platform and into our credit cards, that will have a positive impact on revenues, as well as treasury products and services. And then trying to manage expenses diligently as possible in a regulatory environment, in U.S. that keeps us pretty active. So, 10% year-over-year, we’re not quite there yet but some number of quarters are front of us so I think we’ll be able to see that consistent basis. And clearly being able to produce positive operating leverages is one of the goals we have.

Just on -- you said the commercial portfolio, you're running down the rest of 2015, or did you mean the rest of 2014?

No. We're down to relatively small number but we’ll have - we still have to run it off the rest of 2015. They won't be going till the end of 2015 but it has a lot smaller effect in 2015 that did in 2014. So, I don’t expect we’ll talk that much about it next year at all.

So, the drag is less. On the non-interest revenue, US dollars it seemed down a little bit more than I would have thought, 126 versus 134. Is there anything unusual in that?

No. The big thing in there just lower mortgage volume than the U.S. As you know, the 1.8 trillion mortgages done in 2013 and investment for 2014 I realized it doesn’t perfectly line up the months but it’s close enough it’s about a trillion. So, down 45% and margins are down on that business too. So, that’s really what we’re faced with but that has a marginal impact on net income but does have an impact on, it does have an impact on revenues. But that business, we had pretty good growth in production this quarter and I am optimistic about what production will look like there, the next couple of quarters based on how low the fixed rate financing is in the U.S. So, I think we’ll see some pick-up in that over time. But that’s really what, that’s really the big decline in revenue - in fee income.

And then one last one. Average current loans and acceptances, growth rate seemed a little slow. Were there some loan sales that depressed that this quarter?

There was a little bit that came out there. There was a little bit but it had a modest impact on it. But what I’d really is, what’s really going on in the United States, it’s still on the consumer side, the ability to grow mortgages and home equity loans, it’s still slower. And so I think that's - if you look at the trends in those portfolios, since like the peak in 2007, for most banks you’d find, most banks are sized and little smaller, of course the big you’d find that, those portfolios haven’t started to grow yet. Now, that being said, certainly the, with home prices improving in United States, we’ve seen a pick up in home equity lending. And I think that's a big positive and I expect that some number of quarters down the road will begin to see that portfolio grow. Utilization of lines on home equity is also down. But some of that is a combination of stronger selling of home equity products and so the line utilization will pick up over time. So, I think we’ll continue to see some growth there. The biggest growth in the consumer portfolio in the U.S. as you know are auto loans which are portfolios grown and student loans which most of that is handled by the U.S. government. So, that’s really in most banks balance sheets. So, that’s really the slow part of what’s going on in the consumer side. So, little bit of sales but by and large the business side of business is growing pretty strong and I think we’re right through the end of the quarter. So, we’re pretty optimistic looking forward.

Okay. Thank you.

Thank you. Our following question is from Gabriel Dechaine from Canaccord Genuity. Please go ahead.

Good afternoon. Just wondering about -- curious about interchange regulation. If there's a cap implemented on interchange, how would that affect the growth strategy for some of your premium cards, specifically one like the World Elite, the 2% travel cash back card?

Gabriel, its Cam Fowler here, thanks for the question. Probably not appropriate to be commenting exactly on the interchange point. Now, obviously we don’t have a same in the setting of this. We’re paying quite close attention and as you point out, we are pretty heavily focused on this business and specifically within the business, the premium segment. I think the key point here to keep mind for the business that we have is, the business is growing very well, particularly in the World Elite. It will be impacted by an interchange cap. I think that’s fair to say but we are coming to this from a relatively smaller base than the vast majority of our peers. So, I don’t anticipate this to be a material impact on us and it will certainly not slowdown in any way our commitment to the space and the value of these customers to the franchise.

Or the value of the value proposition I guess, wouldn't be impacted?

Well, I think it’s true that issuers in this regard have lots of labors they can consider in terms of the economics of the business as do other participants in the ecosystem and that one will just play out over time. But we see this to be such an important product to us in our aspiration for primary customers that we've been pretty thoughtful about the whole thing.

Just to go back to Wealth for a minute, and then going through various adjustments here, if I exclude the insurance business, I focus just on what you call Traditional Wealth, back out the F&C contribution to revenues, it looks like organic revenue growth in Traditional Wealth, it was about 11%. And that falls -- it's a good number, but it falls quite a bit short of the 19% growth in AUM. What's the driver behind that divergence? Is it you're got a bunch of assets at the end of the quarter or some fee adjustments with -- Gilles, if you can –

Thanks Gabriel. The major issue here is that, our NIM in the wealth side year-over-year, down 29 business points. So, the NER growth, fees, commissions et cetera, were up 15%. The NER growth is like around 1% and that's from the interest rate. Now that's stabilized because comparing to the previous quarter, it’s only down about 2% but it does look pretty bad year-over-year. The NER makes up for it.

That's helpful, thanks. And if I could sneak another one in there for Bill or Tom. On the capital, I was a bit -- I'm surprised to see you reintroduce the drip discount, the 2% drip discount end quarter. Is there -- was that a one quarter thing, now that you're at the low end of your target range for core Tier 1?

It's Tom. We put the discount on during the last quarter and took it off for the dividend declared today and so was just a one quarter discount and we decided to take it off given the strength of the ratio in the quarter.

Okay. Thanks. I’ll re-queue.

Thank you. Our next question is from Doug Young from Desjardins. Please go ahead.

Hi, good afternoon. I guess I'm really -- one key question is, I know there's some give and takes on the EPS this quarter between the M&I, PCI and PPL, and then I think you had lower security gains and the hit on the insurance side. And I'm just also wondering, with all of the adjustments you made to lower your risk-weighted assets, if there was any gains that came through related to sales of the securitized portfolio or buying bulk insurance, if there was any gains that I'm missing in there.

No. There were no gains that resulted from the activities that you’re asking about and overall in the quarter as you probably saw security gains were quite low relative to our normal run rate.

Yes, okay. But there's nothing else unusual,? Okay. And then just on the Wealth Management quickly, and I know there's a lot bouncing around on the efficiency ratio, but I did see the efficiency ratio increasing. And I'm just wondering, is that now a new normal efficiency ratio level for the Wealth business overall? Or is there, or should we be anticipating that to come down back towards where it historically has run? And is that an impact of the business mix impact because of the F&C acquisition?

The F&C acquisition didn’t have much to do. But that ratio is roughly in line with the overall Wealth Management ratio. Obviously this quarter it was impacted by the interest rate or the losses resulted interest rate and number was about 70.7. We think that we can be tracking to around 70 but when we project out a couple of years lot with the revenue growth that we’re expecting, we think that number is going go down below the 70 number. But given the business mix we think that that probably the number that we can realistically shoot forth is probably around 67, 68, a lot of it has to do with mix and some of the businesses we run have high efficiency ratio, it’s just the nature of the business. Doug Young – Desjardins Capital Markets: And so just a point of clarification on an earlier question, and sorry I missed this. You talked about 235 million to 245 million around -- with F&C on the Wealth side. Can you just clarify, is that your target in terms of where you think you can take earnings, or?

No. That's where we’re running currently. Doug Young – Desjardins Capital Markets: Okay. That’s fine, thank you.

Thank you. Our next question is from Meny Grauman from Cormark Securities. Please go ahead. Meny Grauman – Cormark Securities: Good afternoon. A question about your ETF business. I'm hearing that there's growing pricing pressure in that business, and I was wondering what the competitive landscape is and specifically, what is going on with fees in this business?

Thank you for the question Meny. The ETFs business – how would I describe it, obviously the MERs and ETFs quite a bit lower than mutual funds. And equity is higher than fixed income. The reason that, although there’s been some competitive pressure, the reason that MERs has come down a little bit in that business in the last couple of years is because it’s been a trend towards more fixed income ETFs and we’ve been leading the trend. So, our EPS, our MERs have come down little bit but they’ll stabilize now. On the other hand, when you had a specialty ETFs like – call ETFs that we have lot of success with, the MERs in that business are quite a bit higher. So it depends a lot on the products that you’re launching but I think in the last, as I say the last couple of years because of the launch of the fixed income ETFs, the MERs have come down. Just a matter of interest, BMO is now in the top 10 globally in fixed income ETFs. So, we’ve integrated more or less let's say credit for introducing these two to the Canadian marketplace and they’ve been extremely well received and volume is picking up and with that we, the contribution is also picking up. Meny Grauman – Cormark Securities: Thanks, and then just a quick question on F&C. You noted selling F&C products to new customers, in particular, bringing other products to North America. I'm wondering, how long does this sales process typically take? Or more clearly, when do you expect to see real progress in terms of that initiative?

One of the reasons that we’re so interested in F&C was because we'd a lot of success selling the Pyrford International Money Management or Asset Management to the North American market. I think in the last three years the assets of Pyrford have tripled and a lot of it had to do with our North American distributions so we felt pretty comfortable. Now, it did take us couple of years to gain some traction in North America because we had to train the sales force et cetera. With this, with F&C we started training the sales force right out gate. And it’s not so much about how long is it going to take us and we’re really into kind of the institutional timing for these and the buying cycle as you know in this business is a little bit longer. So, I would expect that we’re going to start seeing some benefit from this in the latter part of this calendar year. Meny Grauman – Cormark Securities: Great. Thank you.

Thank you. Our following question is from Derek De Vries from UBS. Please go ahead.

Thanks, and good afternoon, everyone. I want to go back to an earlier comment you made about the US personal and commercial banking business. And you talked about -- you were talking about the pressures on NIM, and you said that going forward, you'd expect to see less competition on the asset side of the balance sheet. First, how many more quarters should we roll forward that guidance for 2 to 4 basis points of NIM pressure? And then second, why would you think in a higher interest rate environment we would see less pressure competitively on the asset side? I would have thought it would be more.

Okay, this is Mark Furlong again. So, I probably said something like less competition, what I should have said is the kind of the intensity of the competition is little different today than it was a year ago. So I still think we’ll see some competition. But although the condition is precedent to having an increase in interest rate would tell you there is some expansion going on that is a lot more substantive than it is today. And if that’s the case, that sounds like a lot more growth and a lot more opportunity. And clearly as you’ve seen from the writings of the performance of the U.S. banks, there’s a narrower group of banks that are having relatively robust growth in loans and so therefore there’s lot more competition as that expands in the U.S., that growth then naturally there’ll be more sources that aren’t necessarily are there today. So, I think going forward we’ll see stronger growth in the U.S. and that will give everybody a chance to participate in that and hopefully that maybe neutralize some of the silliness that goes on from time to time in loan pricing. In terms of looking forward from a margin compression, the risk of compression, I think that maybe it would be best if I, at least for the fourth quarter said, I don’t know the range has really changed much at least right now for what the risk of that is. The positive side is that you get, as we get loan growth, it’s coming out on the business side, it spreads are less than the loan growth that we get three or four years ago. So, that is opposed to like robust reprising that just naturally brings spreads down. So, we’ll grow net interest income because we’re adding good relationships and cross-selling into that relationship, albeit they’re going to come on at spreads that are below historical spreads. So I see that as a positive to the equation and we’ll continue to grow deposits I think through the cycle. So, I am sure there’s some excess liquidity that will move out but that’s just natural in a raising rate environment. And then I think that the last piece I make sure I give you complete answers. I think that when we get to the fourth quarter, we’ll give a little more, I’ll be able to give a little more a broader outlook on what happens to spreads, what happens to margins in 2015.

Okay. That was very completed. Appreciate your response.

Thank you. Our next question is from Mario Mendonca from TD Securities. Please go ahead.

Question for Cam. Can we go back to response to Darko about the growth in non-interest revenue? My inclination is to try to tie that growth into something else that's happening. And would it be fair to say that that growth is connected to the growth we're seeing in loans, deposits, investment income -- or in AUM? It would be helpful if you could try to marry that with something that we also see throughout your disclosure.

Thanks for the question Mario, it’s Cam here. I think what you’re asking is where is it coming from? And I would go back to the fundamentals of what’s going on in the business. The objective we have is sustained organic growth that's ahead of the market right now and for the past few quarters I think we’ve been able to do that. The balance sheet is what’s driving it and you can see that in most categories we’re up ahead of the market which is exactly where we’d like to be. But we are benefiting on the retail side on products, investments are kicking in, the card products contributing as of the commercial business and there’s more opportunity on the card side in the future. But it’s very broad based and I would link it to the sales performance and the distribution disciplines that we have going now in the Canadian business on both sides of the balance sheet.

Okay, that's helpful, and another, more of a philosophical question. When you were referring to in interchange, and I'm not going to ask about numbers here, when you were referring to interchange, you said we don't have a say in the interchange fee. And that's virtually identical to what Royal Bank said on their call, they said we don't have control of the interchange. And what confuses me about both of those statements is that the banks are providing a service and getting paid for that service. So, why wouldn't the bank have a say in what it gets paid? And both banks offered the same explanation, in both cases I was confused. Why wouldn't the bank have a say in what it gets paid?

It is quite a philosophical question you're asking and I am not in a position to answer it. But we have a well structured and secure payment system in the country that's in place for long time, many decades. And it’s the networks who make this call and that’s the way it is. We participate to the extent that we're asked and we’re invited for our opinions but we are one player in a complicated ecosystem. That's all I have to say now.

So, if Visa and MasterCard announced we are going to get paid zero, that would be -- how do the banks react to that? It just seems odd that a bank doesn't have a say over what it gets paid for providing a service.

I can understand where you're coming from. I didn't set the rules, how we would respond is the way I suspect most organizations respond in competitive situation which is to fetch your options and see how you think you can do best in the market.

Thanks.

Thank you. This concludes the Q&A session. I would now like to turn the meeting back over to Ms. Haward-Laird.

Thank you, everyone. We’re happy to take any further calls in Investor Relations with any follow-up questions, and have a great afternoon. Thank you.

Thank you. The conference has now ended. Please disconnect your lines at this time. And we thank you for your participation.