Bank of Montreal BMO-T is selling 138 branches in the United States to North Carolina-based First-Citizens Bank & Trust Co. and plans to open 150 new locations with a focus on California.
The bank is offloading branches across 11 states, softening its retail presence in the U.S. Midwest.
In 2023, BMO purchased BNP Paribas’s U.S. unit, Bank of the West, expanding its reach into California. The deal doubled the size of the bank’s U.S. branch network to more than 1,000 locations.
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The branches being sold are in North Dakota, South Dakota, Wyoming, Nebraska, Kansas, Missouri, Oklahoma and Idaho, as well as select branches in western Minnesota, one branch in eastern Oregon, and one branch in southern Illinois.
“We’re sharpening our focus on markets with the greatest potential for long-term growth,” BMO’s U.S. president Aron Levine said in a statement Thursday.
The bank plans to open 150 new branches in the next five years, largely in California, aimed at growing its retail, commercial and wealth management businesses.
First Citizens Bank will assume about US$5.7-billion in deposits and purchase US$1.1- billion in loans.
The sale is expected to close in mid-2026 and is pending regulatory approvals.
BMO did not disclose the value of the sale, but said that the impact to its common equity tier 1 (CET1) ratio – a measure of a lender’s ability to absorb losses – is not material.
“The next step will be adding higher-return branches,” Canadian Imperial Bank of Commerce analyst Paul Holden said in a note to clients, “which is the harder part from an execution perspective.”
The move is the latest in a series of changes at BMO. In September, the bank said chief financial officer Tayfun Tuzun will retire in 2026 after five years with the lender.
The departure added to BMO’s recent leadership changes, which included the addition of Mr. Levine, a former Bank of America executive.