AGM 2011

Mar 22, 2011

Good morning, fellow shareholders, and welcome to the 193rd annual meeting of the Bank of Montreal. By way of introduction, I am David Galloway, Chairman of the Board, and I would like to call this meeting to order. On behalf of all the members of the board, I would like to say how pleased we are to be here in Vancouver and express our appreciation for the genuine hospitality that we have all received. The last time that we held our annual meeting in Vancouver was a decade ago in February 2001. I am delighted to be joined on the stage this morning by Bill Downe, President and Chief Executive Officer on my immediate right, Russ Robertson, Chief Financial Officer, Simon Fish, Executive Vice President and General Counsel, and Blair Morrison, Senior Vice President, Deputy General Counsel of Corporate Affairs and Corporate Secretary. In addition to Bill, Russ, and Simon, who are on the stage, I would like to start this morning with the introduction of BMO's senior leadership team. I would ask each person to stand and remain standing when introduced. Please hold your applause, hopefully, until all names have been called. Ellen Costello, Head of Personal and Commercial Banking, U.S. Tom Flynn, our current Chief Risk Officer and our incoming Chief Financial Officer. Kevin Lynch, Vice Chair, BMO Financial Group. Jacques Ménard, President, BMO Financial Group, Quebec. Tom Milroy, Head of BMO Capital Markets. Gilles Ouellette, Head of Bank's Private Client Group. Rose Patten, Special Advisor to the President and CEO. Surjit Rajpal, our incoming Chief Risk Officer. Richard Rudderham, Executive Vice President and Head of Human Resources, and Doug Stotz, Chief Marketing Officer, and Frank Techar, Head of Personal and Commercial Banking. I appoint Steve Gilbert and Francine Beauséjour, representatives of Computershare Trust Company of Canada to act as scrutineers for the meeting, and Blair Morrison to act as secretary. The secretary has confirmed that notice of this meeting was duly given in accordance with the Bank Act and that a quorum of shareholders, as prescribed by the bylaws of the bank, is present in person or represented by proxy. Therefore, I declare this KPMG LLP are present today, represented by Reinhard Dolzla, Jim Newton, and Bill Thomas. Now on to some procedural matters. Closed captioning is being provided here in the room for people who are hearing impaired. The meeting is again being broadcast live on the internet in both official languages, and shareholders watching on the internet are able to submit questions or comments to the meeting. Those wishing to do so should follow the instructions on the annual meeting webcast launch page. We would ask that any questions or comments be related to the matters currently before the meeting, and when submitting questions, that individuals provide their name and indicate whether they are a shareholder or a proxy holder. We will do our best to respond to all such questions during the meeting, but any questions not answered will be responded to by email following the meeting. Facilities for simultaneous English/French interpretation have been provided, and you will find English on channel 1 and French on channel 2. You are welcome, of course, to address your questions or comments in either English or French. At the appropriate time, any shareholder or proxy holder wishing to speak should raise their hand, move to the closest aisle, and wait for an attendant to approach them with a microphone. Each microphone is numbered, and once your microphone is recognized, you should ask your question. In order to allow as many shareholders as possible to have an opportunity to speak, we would ask that you observe the following guidelines. Each shareholder will be allowed to speak once on the matter before the meeting, and please keep any comments to a maximum of 5 minutes. Regarding the physical layout of the room, in the event of an unforeseen emergency, I would like to point out there are exits on both sides of the room. The agenda today will consist of an address by Bill Downe, the report of the financial results for 2010 and the first quarter 2011 by Russ Robertson, followed by four resolutions proposed by management and four shareholder proposals. Finally, I would like to caution those attending this meeting by stating on behalf of those speaking today, forward-looking statements may be made during this meeting, and there are risks that actual results could differ materially from forecasts, projections, or conclusions in forward-looking statements. Certain material factors and assumptions were applied in drawing the conclusions or in making the forecasts or projections in the forward-looking statements, and you may find additional information about material factors and assumptions that could cause actual results to so differ in the caution related forward-looking statements set forth in our 2010 annual report and our first quarter 2011 report to shareholders. Pretty obvious that a lawyer wrote that. I would like to begin the formal part of our agenda by looking back all the way back to 1886 when the Bank of Montreal announced it was going to open its first branch west of the Rockies right here in Vancouver. Then, as now, it was crucial to be there to serve our customer needs. For Bill Downe, our President and Chief Executive Officer, this is the defining feature of a successful bank, whether in a community we have served for 125 years or in the new communities that BMO is adding each year. It gives me great pleasure to ask our President and Chief Executive Officer, Bill Downe, to take the podium. Thank you, Chairman, and good morning, everyone. [Foreign language] Like Mr. Galloway, I'm pleased that we're holding our annual meeting here in Vancouver. Canada is renowned for its diversity, and nowhere is that better represented than in this city. There's an openness here and a willingness to hear everyone's point of view, and along with that, there's a readiness to embrace change. It's also been a pleasure to spend time with some of our good friends and clients here in B.C., and I'd like to recognize, in particular, one of our Directors, Dr. Martha Piper. As past president of the University of British Columbia, Dr. Martha Piper brings an important Western perspective to the work of the board. I would also like to mention Joanne Gassman, who was recently appointed Senior Vice President for British Columbia and Yukon, who leads BMO's efforts here in the province. BMO had an outstanding year in 2010, marked by strong performance and significant progress against our strategy. That strategy is evident across a number of dimensions, and at the top of the list is growth. In our most recent fiscal year, we posted the highest revenue growth of the past decade. Personal banking, commercial banking, wealth management, and Capital Markets all contributed. At the same time, we're expanding our footprint systematically in North America and selectively around the globe. We have a focus. We're not trying to be all things to all people. We're aligning every capability of the bank to our customer promise and specifically targeting customers for whom our promise is most relevant. We have a single purpose, to be the bank that defines great customer experience. Every BMO employee has the same goal: to give our customers confidence that they're making the right choices, supporting them with straightforward advice and guidance, and that starts with listening. Like all good strategies, it's simple and clear, and it's paying off. In 2010, with strong revenue growth, we posted the highest net income in the history of the bank, $2.8 billion. From that, we paid out $1.7 billion in dividends, $2.80 for every common share held. Our shareholder return at 26.4% placed us at the top tier of our Canadian peer group for the second year in a row. That momentum is continuing. Our first quarter results signaled an equally strong start to 2011. Russ Robertson, our Chief Financial Officer, will fill in some more details in a few minutes. But ahead of that, I'd like to focus on three areas that we believe are critical as we turn our strategy into competitive advantage. The first is our commitment to customers and the way we help them meet their financial goals. When we talk to people about their biggest financial challenges, not just individuals, but corporate clients as well, we hear a common refrain. Why does banking have to be so complicated? For us, the answer is quite simple. It doesn't. From this fundamental conviction that there is a better way, we're building our entire approach to customer experience, and we're reshaping the bank into an organization that's uniquely positioned to simplify complexity and satisfy our customers' highest expectations. The second key factor as we put our strategy into action is a firm understanding of BMO's most important markets. We're pursuing market share growth in every region of Canada and expanding the definition of our home market into the central U.S. The acquisition of Marshall & Ilsley Corporation, M&I, will effectively double the size of the opportunity for us in North America. We're still a couple of months away from regulatory approval to close the transaction, but we're well into transition planning to more fully integrate our North American platform. We expected that the market might discount in the short run the upside that the opportunity represents. Today, I want to be very clear about what the M&I acquisition will mean for our shareholders. In 2010, our combined personal commercial wealth management businesses in the U.S. reported $184 million in earnings. In the medium term, our aspiration is that these businesses will generate CAD 1 billion of earnings annually. This is a bold objective. We also know that the kind of growth we envision has to be grounded in values shared by the customers, employees, and stockholders of the bank. The third theme I'll be exploring, managing responsibly, isn't a message you roll out once a year and wrap around your company like a flag. It goes much deeper. BMO has a responsibility to run its businesses ethically and transparently to achieve sustainable positive results. We also have a responsibility to help people succeed, and we understand that as a bank, we have a unique role to play in society. We're an institution that has a direct impact on economic prosperity and future growth. This understanding of our deeper responsibility and the trust that's vested in us is woven through every aspect of our commitment to all of our stakeholders, and that includes the communities we serve. Let's get started first with how BMO creates value by satisfying customers. As we said in this year's annual report, our customers understand that their world has changed. They felt the impact of global economic events at the personal level and their shifting priorities. Their relationship with money is changing. Customers have told us they want to take ownership of their financial lives. At the same time, they want guidance in making the right choices for them. These kinds of insights, which come from listening attentively to customers, are precisely what keeps our customer promise relevant. With every BMO customer, whether it's a person at the counter in a local branch or a corporation financing a new venture halfway around the globe, we're committed to a simple promise: making money make sense. And how are we delivering on that promise? We're giving frontline employees the coaching and tools they need to help customers succeed in a world that has changed, to offer guidance on how they can control spending, grow savings, borrow smartly, invest wisely. The Smart Steps program is a case in point. There are Smart Steps for many segments: business, investors, students. If you haven't seen them, Smart Steps for Parents are a particular favorite of mine. This online destination includes tools and advice, access to leading experts, and an online community to give parents a new way to speak to their children about money. We've also launched BMO MoneyLogic, a tool built into our online banking and bill paying platform that's free for our customers. It helps them manage household spending, to create a budget, and to stick to it. In just 60 days, 200,000 Canadian customers have started using MoneyLogic, and their feedback has been extraordinary. Our commitment to helping customers is just as evident in the corporate and institutional market as it is in personal banking. BMO Capital Markets is pursuing the role of trusted advisor with every client they serve, combining deep customer knowledge with a specialized expertise within key industry sectors. You can most readily see the benefits of this disciplined sector focus in our mining business. In 2010, Global Finance magazine recognized BMO as the world's best metals and mining bank. It's a distinction that reflects our unique understanding of our clients and the industries in which they compete. Our mining research covers more public mining companies than any other bank in the world, and we recently launched Mining 101, a seminar for institutional investors seeking new insights to improve their own performance. You can see the commitment to the customer on the part of employees everywhere in BMO, nearly 90% of whom say they feel proud to work for the bank. This is a measure of both cause and effect. Our employees take pride in BMO's success, and our success is fueled by their commitment. Of course, the ultimate measure of BMO's success is the success of our customers, and the number of customers we are able to help is about to grow dramatically. This brings me to my second theme. Today, we are pursuing market share growth in every region where we compete. Over the past year, Canadian personal and commercial banking has shown exceptionally strong performance, with revenues in 2010 up by 10% and record net income for the year. BMO Bank of Montreal is a Canadian market leader and a pace setter for our entire enterprise. With this business so well-positioned, expanding the definition of our home market to include the central U.S. is a natural next step. Already anchored in Chicago, we will extend our footprint in adjacent Midwest states whose combined population and GDP are similar to Canada's. With a single step in our expansion plan, we are doubling the size of our North American home market. The six-state area has other interesting points in common with our Canadian marketplace. It is a mix of large metropolitan centers, smaller cities, and farming communities, and the economy is driven by many small and medium-sized businesses. This is familiar ground for us. In commercial banking, where we are a Canadian market leader, BMO is known as a consistent lender through the cycle, with proven strength in managing credit risk. High customer advocacy in personal and wealth reflect a tradition of community-focused banking that we know is highly valued in the Midwest. When I spoke at last year's annual meeting in Winnipeg, I talked about the moment being right for recognizing growth opportunities and acting on them. We not only anticipated the opportunity, we were well-prepared for it, with very strong Basel III capital ratios at the end of fiscal 2010. We see tremendous opportunities ahead, combining the strengths of two U.S. banking franchises that have built solid reputations by putting the customer first. We expect to grow personal and commercial banking through a network that will comprise some 900 BMO branches in Canada and 700 in the U.S., an enviable footprint with a combined North American deposit base of $160 billion. When the new acquisition has been completely integrated with our existing Harris operations, we will have a number three or be within reach of a number three market share in every major center that we operate in the Midwest, and of course, we will be number one in Wisconsin. We are delighted to welcome new customers to BMO cities such as Milwaukee and Madison, St. Louis, and Kansas City, plus Indianapolis, Rockford, and Minneapolis-St. Paul, urban centers with a total population of nearly 13 million. We are also strengthening our affluent client base in Arizona and Florida, complementing our businesses in Texas and on the West Coast. While we're on the subject of U.S. growth, I'd like to take a moment to welcome the longest-running dividend record of any Canadian company, 182 years. The message to our newest shareholders is the same for all BMO shareholders. We expect our increased earnings in the U.S. will contribute to our ability to grow the dividend. For employees and longtime customers of M&I, we know we're creating a bank that shares your values, that puts the customer experience front and center. There's one final point. The impact extends well beyond the U.S. As a North American bank with 1,600 branches, we'll be able to leverage our scale to realize economies across all areas of our business. We'll be establishing stronger north-south connections, taking a coordinated approach to product development, to the introduction of new services, to marketing, to online access, to risk management, and to other new ways of doing business across our North American platform. As personal and commercial banking grows, we also expect wealth management and capital markets will benefit as our extended customer base and presence on the ground in major U.S. centers opens new doors for opportunity. Increasingly, the needs of customers cross traditional lines of business. More and more, we're compelled to organize the bank around customer segments rather than products. The motivation to erase boundaries within our own organization mirrors the changes in a world that's no longer constrained by borders, where goods and services travel between traditional and emerging markets, where people, information, and capital flow freely. When we opened our first West Coast branch just a few blocks from here 125 years ago, the same year Vancouver was founded, we saw the enormous potential of this city, the hub for a booming regional economy. It was clear even then that the port would become Canada's gateway to all of Asia. This past October, we became the only Canadian bank, and one of only three North American banks, to incorporate a banking subsidiary in China. This marked the culmination of a decades-long commitment to this market. In the beginning, we provided commercial introductions for clients seeking to do business in China. As our business matured, we handled a growing volume of trade finance and foreign exchange transactions. We invested in Fullgoal, a leading Chinese mutual fund company. We developed deep relationships with government and the major Chinese banks. Today, BMO's foreign exchange transactions with China total more than 1 billion US dollars every day. In addition, the Chinese government foreign exchange authority in 2010, for the fourth year in a row, named BMO one of the most popular market makers in China and the best non-U.S. dollar market maker. Over the past 20 years, as China's stunning growth has propelled it from 10th place to become the world's second-largest economy, BMO's business has stepped up. Today, BMO's presence in China is an important differentiator for customers with aspirations to grow beyond their domestic market, and we're building on that unique advantage. In January, we announced our agreement to acquire Lloyd George Management, a Hong Kong-based asset manager. It's a move that bolsters BMO's portfolio capabilities in Asian and emerging markets, and it fits within a broader global business that will have $100 billion of assets under management and an established presence in key markets worldwide, from North America to Europe to the Middle East, India, and China. Wherever we do business around the globe, our customers expect, as do our shareholders, that we'll manage our business responsibly, which brings me to my third theme. As I said at the outset, we recognize that banks have a unique institutional role to play in society. Banks provide the means by which economic growth can occur, and they help to ensure the stability to sustain it. This is both an obligation and an opportunity. It's a role we at BMO don't take lightly. Within that broad social mandate, responsibility for a bank means maintaining capital strength, managing risk in complex global markets, adhering to rigorous ethical standards, maintaining transparency and accountability in our corporate governance practices. For BMO, responsibility comes down to something even more fundamental, the simple idea at the heart of our vision. We have a responsibility to help people be successful. I think the federal government's recent task force on financial literacy is a case in point. This initiative, spearheaded by Jim Flaherty, the Minister of Finance, sets out worthy goals that align directly with our commitment to help customers make better choices. Jacques Ménard, chairman of BMO Nesbitt Burns, who's here with us today, has proudly served as vice chair of the task force. It's a natural extension of our customer promise, making money make sense, taken to the larger social arena. At BMO, this is how corporate responsibility works. Attention to social, economic, and environmental responsibility is not a matter of compliance. It's a validation of how we already do business. It's why we're actively engaged in the essential discussion about global regulatory reform. It's why our Vice Chair, the Honorable Kevin Lynch, has been broadening the national conversation around what we can do collectively to boost Canadian productivity, to spark innovation, to build long-term economic prosperity. For BMO, helping to move this discussion forward speaks to the essence of what corporate responsibility really means. It's a part of the connection we're forging with customers on every level. We have 38,000 employees, soon to be 46,000, who work with incredible focus and commitment every day to make our customer promise live. It's their effort that's generating strong growth across the businesses of the bank, building real value for our shareholders. I started out this morning by saying that our customers' world has changed. If there's one thing that I hope you take away from these remarks, it's that BMO is changing as well. I'm going to turn the podium over to Russ Robertson now, but I'd like to say just a short comment. As we announced on January 5, effective today, Tom Flynn will assume the role of Chief Financial Officer of the bank. Russ is going to oversee the transition of M&I. As a consequence, today is his last or final official address to the shareholders, and I want to just take a moment to thank him for his tremendous contribution in the last three years. It has been a source of constant strength to management, and I know to the board of directors. I'd just like to thank him very much for his contribution to our success. Thanks, and over to you, Russ. Thank you very much, Bill, and good morning, everyone. I'm pleased to be here today in Vancouver at our annual meeting. This morning, I'm going to report on the financial performance of our company in fiscal 2010 and the first quarter of 2011, as well as providing a few comments on regulatory changes related to Basel III and International Financial Reporting Standards. Before I begin, as some of my comments may be forward-looking, I would like to draw your attention to the caution regarding forward-looking statements. In addition, we use certain cash and core earnings measures to assess performance. Accordingly, we also provide this caution that these measures do not have standardized meanings under generally accepted accounting principles. Please refer to our 2010 annual report on page 91 for a discussion and reconciliation of these measures. In fiscal 2010, net income of CAD 2.8 billion was CAD 1 billion higher than 2009, resulting in earnings per share of $4.75. Our return on equity improved to 14.9%. We remained financially strong with a Tier 1 capital ratio at October 31st of 13.45%, which I'll comment on shortly. Taking you through our income statement, revenue for the year was CAD 12 billion, up 10.4%, or more than CAD 1.1 billion from the previous year. This increase was driven by two main factors. First, there was good organic revenue growth in each of our three operating groups, Personal and Commercial, Private Client Group, and BMO Capital Markets. Second, revenue benefited year-over-year from strategic acquisitions, with the two most prominent being the Diners Club credit card business in P&C Canada and a transaction to acquire certain assets and liabilities of a Rockford, Illinois-based bank in P&C US. With revenue growth over 9% in 2008, over 8% in 2009, and over 10% in 2010, we're delivering strong top-line growth with continued momentum across all of our businesses. Provision for credit losses at CAD 1 billion, while still at elevated levels, improved significantly in 2010, declining 35% year-over-year, reflecting an improving trend across both our Canadian and U.S. loan portfolios. Non-interest expense of CAD 7.6 billion increased 3% in 2010. The increase was attributable to acquired businesses, higher performance-based compensation in line with improved results, and higher investment spending to support our business initiatives. We continue to improve financial performance by growing revenue and effectively managing our costs. We measure our progress by pre-provision, pre-tax earnings, or simply put, revenue minus expenses. The pre-provision, pre-tax earnings measure is a simple but helpful way to look at our operating progress. In 2010, we achieved CAD 4.6 billion of pre-provision, pre-tax earnings, the highest in the history of the bank, and up over CAD 900 million from a year ago, demonstrating good momentum. We also measure our progress through the cash productivity ratio, which is cash expenses divided by revenues. You can see on the slide that in 2010, for every dollar of revenue we earned, we spent less to generate it, a good indicator of our ability to effectively manage our costs. In 2010, cash productivity improved to 61.9% from 66.3% in 2009. Let me now turn to the performance of our operating groups, where our commitment to customers and their success is clearly visible. As a reminder, BMO employs a methodology for segment reporting purposes whereby expected credit losses are charged to the operating groups. The difference between expected and actual provisions is charged to corporate. Personal and Commercial Banking Canada reported net income of CAD 1.6 billion in 2010, over 16% higher than a year ago. Revenues of CAD 5.8 billion increased 10%. Top tier business serves more than 7 million customers, offering a full range of products and services with a differentiated brand position built around making money make sense. We invested CAD 35 million in training and development of our frontline employees geared to improving the quality and consistency of their conversations with customers. We strengthened our distribution network, opening and upgrading a total of 27 branches, and launched an innovative new branch format designed to encourage great conversations with our customers. We also acquired the previously mentioned Diners Club North American franchise, which more than doubled our corporate card business. In addition, we continue to redesign processes and technologies to achieve a high-quality customer experience and create capacity for customer-facing employees. In U.S. dollars, we reported net income of $168 million in our U.S. Personal and Commercial Banking business, where we serve nearly 1.3 million customers and enjoy a rich heritage of more than 125 years in the U.S. Midwest. Revenue of $1.4 billion improved $25 million or 1.8%. Revenue reflected improved net interest margin, primarily due to improved loan spreads and the Rockford transaction that closed late in the second quarter of 2010. Core deposits, which includes checking, savings, and certain money market accounts, grew by more than 15%, maintaining our number 2 ranking for retail deposit market share in the Chicago area. Turning now to our Private Client Group, which consists of both traditional wealth management plus insurance businesses, we reported 2010 net income of CAD 470 million, up 31% from a year ago. The financial results reflect our ability to continue to differentiate ourselves by delivering a great client experience that is anchored in financial and retirement planning. Revenue of just over CAD 2.2 billion grew CAD 233 million, or 12%, reflecting increases across all of our businesses while we continued to manage expenses effectively. This resulted in cash productivity improving 630 basis points to 71.5% in 2010. Results excluding the insurance business had strong performance relative to our Canadian peers with double-digit revenue growth. Revenue growth was driven by an improvement in client assets under management and administration. Insurance financial results benefited from higher premiums and the inclusion of a full year from acquisition late in the second quarter of 2009. We continue to invest in the businesses and enhance our product offers. As an example, we recently launched 10 new exchange traded funds in early February, expanding our product lineup to a total of 40 as part of our managed solutions program for retail customers. We have also effectively integrated and expanded our insurance businesses and streamlined related sales processes and applications. BMO Capital Markets posted a strong fiscal 2010, with net income of CAD 820 million and a return on equity of 18.8%. Revenues increased 6% to CAD 3.3 billion, and revenue growth was supported by our continued focus on clients and building a diversified and dynamic portfolio of businesses. Expense growth of 4% was driven by increased employee costs as we made strategic hires across our operations to position our businesses for future growth. The group's productivity ratio improved from 56.5% to 55.5%. We also improved our Canadian league table standing, reflecting the changes that have been underway in the business. For fiscal 2010, Bloomberg named us number one in mergers and acquisitions for announced transactions. Corporate services net loss for the year was CAD 299 million. There was improvement year-over-year due to lower provisions for credit losses and higher revenues. The improvement in revenues is primarily a result of more stable market conditions. Turning now to capital management, BMO is committed to a disciplined approach that balances the interest and requirements of shareholders, regulators, and customers. Our objective is to maintain a strong capital position underpinning our operating group's business strategies and continuing to maintain and build upon depositor and investor confidence. We continue to maintain a very strong balance sheet. As highlighted earlier, our year-end Tier 1 capital ratio was 13.45%, up from 12.24% in 2009. Our Tier 1 capital ratio remains well above the current minimum regulatory capital requirements. I would now like to turn briefly to our first quarter results for 2011, which we announced on March 1st. Net income of CAD 776 million, our highest ever, was up CAD 119 million, or 18%, from a year ago, reflecting strong performance in each of the operating groups. Earnings per share of $1.30 were up 16%, and our return on equity improved to 15.7% from 14.3% a year ago. Revenue of CAD 3.3 billion increased CAD 321 million or 11% from a year ago, as there were solid increases in each of our groups. Credit losses of CAD 248 million were down from a year ago and from the previous quarter, while impaired loan formations continued to trend favorably. Expenses increased from a year ago due to continued investment, and expense increases also reflect the effect of our acquisitions. Finally, our pre-provision, pre-tax earnings reached CAD 1.3 billion, and our cash productivity was 60.9% in the quarter. In the first quarter, we announced two acquisitions. In addition to M&I, we also announced the signing of a definitive agreement to purchase Hong Kong-based Lloyd George Management, an independent investment manager specializing in Asian and global emerging markets. The deal will strengthen our portfolio management capabilities in those markets. The transaction is anticipated to close early in the third quarter of fiscal 2011. Turning to the changing regulatory environment, we have undertaken a great deal of work in regard to both new Basel III capital requirements and the transition to International Financial Reporting Standards. The strength of the people we have in place, combined with the work we have done, has us on track to adopt the regulatory changes while continuing to execute on our growth strategy. BMO's pro forma Basel III capital ratios remain strong after considering the acquisitions and International Financial Reporting Standards, and the bank is well positioned to meet Basel III capital requirements in the near term. Effective November 1, 2011, we will adopt International Financial Reporting Standards as the basis for preparing our consolidated financial statements. Overall, we are on track and expect no significant issues in meeting the reporting standards. In conclusion and looking forward, we remain committed to our strategic priorities, and we have established the following medium-term financial objectives. Over time, increase earnings per share by an average of 12% per year, earn average annual return on equity between 17% and 20%, achieve average annual cash operating leverage of at least 1.5%, and maintain strong capital ratios. Thank you for your time, and I would now like to turn the podium back to the chairman. For the information of those shareholders here this morning, I am informed by our transfer agent that over 233,653,864 votes have been received in respect of the matters of business to come before this meeting, representing over 41% of the total outstanding shares eligible to be voted. Given that our employees represent a significant portion of our shareholder base and to facilitate the proceedings, we have asked certain employee shareholders to move and second certain motions. I will call upon them at the appropriate time. The votes on all matters of business before this meeting will be conducted by ballot. When we get to that part of the meeting, I will walk you through the voting process. Any procedural motions will be voted on by a show of hands. There will be two ballots. The first covers the election of directors, the appointment of the auditors, the amendment of the bank's bylaws, and the approval of an advisory resolution on the bank's approach to executive compensation. The second ballot will deal with shareholder proposals. At this point, I would like to be sure that those shareholders or proxy holders wishing to vote this morning have their ballots. You should have received these when you registered for the meeting. Remember that if you completed and returned your form of proxy, it is not necessary to vote today unless you wish to change your vote. Anyone entitled to vote who does not have ballots, please raise your hand. Sorry. There is a gentleman. If you could make sure he has a ballot. Thank you. Now to our first item of business, the submission of financial statements. In February 2011, copies of our annual report for 2010 were forwarded to shareholders together with the management proxy circular and notice of this meeting. The financial statements for October 31, 2010, year-end, were included on pages 110 to 168 of the annual report. Are there any questions on the financial statements, including any questions from the internet? I wish to stress that the questions must be related to the financial statements at this time and not other matters. Okay. The auditor's report appended to the bank's financial statements can be found on page 109 of the annual report and will be taken as read. This brings me to the election of directors for the ensuing year. Point of order, Mr. Chairman. Yes. Isn't there an inherent conflict of interest with employee shareholders nominating the board of directors? I don't believe so. People are free to vote. We just need to get the nominations on the floor. As determined by the board, the number of directors to be elected today is 16. At this time, I would like to acknowledge two directors, Jeremy Reitman and Nancy Southern, who will not be standing for re-election this year. On behalf of the board of directors, management, and the shareholders of the bank, I would like to thank you both for your years of dedication and contribution as members of the board of directors of Bank of Montreal. Before proceeding any further, I would like to highlight the board policy that if votes in favor of the election of a director nominee represents less than a majority of the shares voted and withheld, the nominee will submit his or her resignation promptly after the meeting for consideration by the board's governance and nominating committee. This policy is set out on page five of our management proxy circular. I will now nominate the following persons to be elected as directors of the bank until the next succeeding annual meeting of the shareholders of the bank, or until their successors are elected or appointed. As each nominee's name is called, I'd ask the individual to stand and remain standing. I note that Madam Brochu is standing for election as director of the Bank of Montreal for the first time today. I will ask that you hold any applause until all nominees have been introduced. Please note that Mr. Beatty, Cope, and Ms. Saucier were unable to attend in person today. Robert Astley, David Beatty, Sophie Brochu, Robert Chevrier, George Cope, Bill Downe, Christine Edwards, Ron Farmer, Harold N. Kvisle, Bruce H. Mitchell, Phil S. Orsino, Martha Piper, J. Robert S. Prichard, Guylaine Saucier, Don M. Wilson III, and myself, David Galloway. Thank you. I will now call on Tara Tabory to second this motion. I have been with Bank of Montreal for four years, and I focus on meeting the personal financial needs of my customers. I second the motion. Thank you. Do we have questions or discussions on this matter? Yes, sir. Can you identify yourself? Yes, I will. Yeah. The National Pension Fund, a significant long-term shareholder in our company with over CAD 2.8 billion in assets. I also rise for the other building trades pension funds throughout Canada and the U.S., with CAD 200 billion in assets holding over 500,000 shares in our company. We are committed, long-term, serious shareholders. As a proud native son of Wisconsin, I also stand in support of the tens of thousands of teachers, firefighters, janitors, and other public workers in the state of Wisconsin whose rights are now under attack by Governor Scott Walker, whose largest campaign contributors were the executives of M&I Bank. Our members have led the campaign around the U.S. to educate M&I consumers on their role their executives and political action committee have played in the effort to finance Governor Walker and his effort to take away workers' rights. I have a number of questions that speak to the fitness of the Bank of Montreal Directors that stand for election. My first question is for Mr. Bill Downe, President and COO of BMO Financial Group. Since M&I has not paid back its $1.3 billion in TARP taxpayer bailout money, Mark Furlong, and his $18 million bonus, will our company be forced to pay back the $1.3 billion owed under TARP sooner than it would otherwise have planned just so they can make these bonus payments? Are we in the right part of the agenda? Okay. The repayment of the TARP at this time is in the best interest of the shareholders of the Bank of Montreal, and that's the basis on which the decision was made. It has to do with cost of capital and the availability of both cash paid back. Thank you. How are shareholders served by this or by the fact that at least 15 other top executives at M&I have been promised severance payments totaling $65 million? I think the- The question, sir, to you, Mr. Downe. That's a contractual arrangement between M&I and those employees, and it preexisted our agreement to acquire the bank. Why has the Bank of Montreal agreed to pay these multimillion severance benefits to M&I executives regardless of whether or not the recipients' positions are terminated as a result of the merger? It's consistent with the contract. Should company money be used to pay golden parachutes for departing executives who are already well paid, Mr. Downe? Chairman, I think that question is outside of the range of something specific to M&I. It's a philosophical question. These are all contractual arrangements, so I- Okay, I'll get to a more generic question then. Considering that M&I Bank underperformed its peers at the 60% percentile for the last three years, why did the Bank of Montreal pay a 34% premium to acquire M&I Bank? The price that was negotiated for the purchase of the bank is consistent with the value that we see in the business going forward, consistent with a competitive process in the market and a great deal of transparency about the bidding process. Thank you, Mr. Downe. Thank you, Mr. Norberg. Thank you, Mr. Chairman. My name is Betsy Kippers, and I am here today representing a union pension fund that has had long-term committed shareholder of 3,225 shares. I am also here on behalf of tens of thousands of Wisconsin public employees whose rights are under attack in the U.S. I serve as the Vice President of the Wisconsin Education Association Council, which represents 98,000 educators in the state of Wisconsin. Over the last 10 years, M&I executives and their political action committee have donated over $80,000 to Governor Scott Walker, and his attacks on our members and public employees have generated overwhelming outrage in our state. My question is for the members of the board who are up for election. Your company is in the midst of acquiring Marshall & Ilsley, M&I Bank. M&I Bank is headquartered in Milwaukee, where I am from, and they do not have a very good performance track record after making big bets on bad real estate in Wisconsin. M&I underperformed its peers in regional U.S. banks by more than 13% just in this past year and by over 40% over the last three years. I am wondering if this is truly a good investment. Despite this performance, BMO has promised M&I CEO and Chairman Mark Furlong over $18 million in severance payments. You keep saying this is under the contract, but this is up to more than triple the amount that M&I estimated Mr. Furlong was entitled to when this was last reported to shareholders. We are wondering where this large increase came from. My question is for Mr. David Galloway. As Chairman of the Board, with a fiduciary responsibility to represent the best interest of shareholders, can you describe the board's rationale for agreeing to these awards? Secondly, how can our company and you as a Director justify paying for tax liabilities for Mr. Furlong and the other executives which represent these payments? Right. Well, I think there is a number of questions there. I think, first of all, we feel it is a very good investment for the Bank of Montreal and think that our shareholders will be well-served in the future. Bill has spoken to that. I can speak more on that. With regard to Mr. Furlong, this has already been said, and I think we are repeating ourselves. There was a contract with M&I. We had to honor the contract, and it is not our affair. I do not know what more to tell. Question on, were you paying the tax liabilities part of that contract? In terms of that, if we're paying the tax liabilities, it would once again, be part of the contract. That's not a choice we have. Thank you. My name is Jim Sinclair. I'm here representing a proxy, probably a few less votes than you folks have. I do rise with a number of areas of concern at this meeting today. You clearly are a large Canadian institution. When I heard you announce today that you were going to be number one in Wisconsin, I felt a little shudder down my back because I think that got some other issues with it. Along with trying to be the number one bank in Wisconsin, you're also the target of a lot of anger in Wisconsin today. As shareholders, we like to think there was a value system that went along with this bank that represented the interest of most of the working people that put our money in your bank and the pension holders. On the question of the payment to these people who are now leaving this bank in trouble, who have taken over $1.5 billion of ordinary people's money to prop it up, would the bank, had they not been under a contractual agreement, what would have been their policy towards paying these people off? Mr. Sinclair, I think there is no question the payments were large, and if we could have negotiated something that was more reasonable, I am quite sure that we would have tried to do so. It is a contractual arrangement. Mm-hmm. One of the things that concerns me about the purchase, and to have our bank and our country obviously associated with this purchase, is the role of the executive members of this corporation and their donations to Scott Walker's campaign. I suppose it is fair to say, and I guess my first question is it the intention that once we pay these people out, that they will no longer be representing our interests in Wisconsin, in the circumstances of today? Or is it the intention of the bank to maintain their services and maintain their role? There are a number of senior executives of M&I that we would like to retain. They are good executives. In terms of the contribution to any governor's campaign, that was an individual decision, not M&I. I should remind you, we do not own M&I at this time, but Yes, I understand that I think- but it seems inevitable from your presentation that we are going to own it. No, we certainly hope we do, but I hope you'd respect the right of individuals to make donations. Well, I think I respect the right of individuals to make donations, but I also understand that these people are the face of the bank and that they are more than individuals. They represent our interest as shareholders, and their behavior and their donations and their political voices are heard in that context. Wisconsin Professional Police Association, the Professional Firefighters of Wisconsin, the Madison Teachers Association, the Dane County Sheriff's Association, and the Madison Professional Police Officers, those are groups that I think a lot of Canadians would have some respect for. They are the organizations that spend their time protecting us. They're the people we count on to put our houses out when they're on fire or to protect us when we're under attack. They've made the decision to launch a campaign against our investment called Move Your Money. They went in on one day, and a bank had to shut down early. These groups have decided that they are going to express their anger over their ripping up of their collective agreement and bargaining rights in Wisconsin by asking their members to withdraw their money from our bank. I want to say, I think this is significant. I think that what they're doing is sending a very strong message that they're angry at the behavior of the leaders of our bank that we bought, but also at their government. I guess one of my questions really is, how do you deal with that? My worry is this, as that starts to spread through Wisconsin, as it surely will, their activity got national news. I never heard about this bank until I saw it in the news or that we had even bought it. But as that goes through, this will spread, potentially. I want to say that today, so we're all clear. The Harris Bank may be next. We've gotten phone calls about the BMO Bank. We represent 3 million workers across the country. We will consider, if nothing is done, boycotting the Bank of Montreal. That is a possibility. Why is that? Because when you go and you tear up people's right to do what they have a human right to do, to sit down with their employers and negotiate a collective agreement, that is a fundamental right that got most of us what we got today, including the money we put in the bank. These people are asking today, and I'm asking on their behalf. These organizations and the people of Wisconsin and the working people there that are under attack are asking our bank to make a clear statement. That statement is to say that you support the right, the human right, to free collective bargaining for working people in North America. This is a right that was confirmed by the Supreme Court judges of Canada. But the question today I have to you and to the directors as you get elected, will you make that public statement not only to the people of Wisconsin but to all of us so that we can make sure this bank does not become the center of controversy in Wisconsin? Mr. Sinclair, maybe I could comment. First of all, with respect to the community I was asking the directors, but okay. No, go ahead then if you'd prefer that Mr. Galloway answer. I am happy to respond. Listen, we are trying not to get involved in this debate. We do not own the bank. The bank does not take positions politically. You are asking me, do I support the right of collective bargaining? The answer is yes. I think you are making some excellent points. There is some advice you are giving to us, and I can assure you that we are listening. At this moment in time, we do not own the M&I Bank. Well, I appreciate that, and I appreciate hearing from you that you do support collective bargaining because I think that will go a long way to turning the tide back in Wisconsin. Thank you very much, and we will all be watching to see what happens. Again, thank you. Oh, sorry. He took the microphone. I'm Judy Darcy. I'm the head of the Hospital Employees' Union in British Columbia, representing 43,000 frontline healthcare workers, the single biggest group in the municipal pension plan in British Columbia and also affiliated to the Canadian Union of Public Employees with over 600,000 members across the country. I want to ask a question related to honoring contracts and sharing values because honoring contracts has been the most consistent response that we've heard from the head table in relation to the actions of the bank that you're acquiring in Wisconsin in relation to public sector workers. Now, it's the members that I represent in this province who had their collective agreements stripped back in 2001 by the incumbent Campbell government. It was the worst experience to date of contract stripping and union busting in Canada and resulted in the biggest layoff of women workers in Canadian history. As many people in this room will know, that case made it all the way to the Supreme Court of Canada, which as Jim Sinclair has mentioned, for the first time in Canadian labor relations history and in Canadian legal history, the Supreme Court of Canada found that collective bargaining rights were Charter-protected rights. We've heard several responses from the head table saying, "We can't interfere with that because we respect contracts." But the fundamental issue here for our members that led to the Supreme Court historic ruling and the fundamental issue for public employees in Wisconsin is about breaking contracts. We've heard also earlier this morning the expression "sharing our values." I would like to ask both to the chair, but I would also ask if there are any of the candidates for board of directors who would like to speak to the issue of shared values. Because in this country, in Canada, we respect collective bargaining rights as fundamental human rights protected by our Charter of Rights and Freedoms. I would like to ask if that is a shared value that will be communicated very clearly in no uncertain terms to the people who run the bank in Wisconsin on behalf of the Bank of Montreal. That's a way to really not just talk the talk but walk the walk, and I would ask a commitment that that would be done. Let's send a message that union busting is unacceptable in Canada, in Wisconsin, or any place across this continent. My name is Mark Norberg. I previously submitted my credentials. The answers to these very pointed questions, I think, have been met with vague answers. Very pointed questions as to the ability to manufacture, to construct good deals for the Bank of Montreal. I would respectfully request my fellow shareholders withhold their vote for this board of directors based upon the answers given today. Thank you. That is your right, Mr. Norberg. If there's no more questions, the bank provides for individual voting for directors. The yellow ballot contains the names of 16 individuals nominated as directors for the ensuing year. The Bank Act provides that you may vote or withhold your vote for the election of each of the nominees. Management recommends voting for the 16 nominees set out in the management proxy circular. Please mark your ballots now. The next item of business is the appointment of the auditors for the ensuing year. I will call on Nathan Kinash to present this motion. Thank you, Mr. Chairman. My name is Nathan Kinash, and I've worked for BMO for seven months, and I'm a small business banker in the Vancouver Suburban District. I am focused on meeting the business and personal financial needs of the small business banking customer, and I propose that the firm of KPMG LLP be appointed as auditors of the bank for the ensuing year. Thank you, Nathan. I'd ask Mark Breakspear to second the motion. Thank you, Mr. Chairman. My name is Mark Breakspear, and I worked for BMO for five years. I'm the investment sales manager in Vancouver, part of the personal and commercial banking group. My role is to provide management, coaching, and leadership and oversight to 18 financial planners in 16 of our Vancouver-area branches. I second the motion. Thank you. Are there any questions with respect to the appointment of the auditors? If there are no questions, I would ask those wishing to vote on the appointment of auditors to mark their yellow ballot. You're asked to either vote for the motion or to withhold your vote. Management recommends voting for the appointment of KPMG LLP as auditors. The next item on the agenda is a resolution to approve the amendments to the bank's bylaws. The proposed amendments are discussed on pages 5 and 6 of the management proxy circular. I call on Grace Tu to present the motion. Thank you, Mr. Chairman. My name is Grace Tu, and I have worked for BMO for 7 years. I am currently a financial service manager at the large branch in Vancouver. In my role, I manage a portfolio of clients, and I help them identify and reach their financial goals. I move that the resolution approving the amendments to the bank's bylaws, as set out on pages 5 and 6 of the management proxy circular, be approved. Thank you, Grace. I call on Lela Dawson to second the motion. Thank you, Mr. Chairman. My name is Lela Dawson, and I have worked for BMO for 25 years. I am currently the manager of a large-sized branch with a staff of 21, which includes partners within the personal and commercial banking group. I oversee the daily operations of the branch. I second the motion. Are there any questions? If there are no questions, I would ask those wishing to vote on the amendments to the bank bylaws to mark their yellow ballot. You are asked to either vote for or against the motion. Management recommends voting for the amendments to the bank bylaws. The next item on the agenda is the consideration of the advisory resolution on the bank's approach to executive compensation. I call on Teresa McFadden to present the motion. Thank you, Mr. Chairman. My name is Teresa McFadden, and I've worked for BMO Bank of Montreal for 35 years. I'm a personal banking area manager in Vancouver, part of the personal and commercial banking group in Canada. My role is providing management and leadership oversights for 10 branches in the Vancouver area in mainly White Rock, Surrey, and New Westminster. I support the branch managers in achieving their customer service and financial goals through coaching and human resources management. I move that the advisory resolution on the bank's approach to executive compensation, as set out on page six of the management proxy circular, be approved. Thank you, Teresa. I call on Samantha Harrison to second the motion. Thank you, Mr. Chairman. My name is Samantha Harrison, and I've been with BMO Bank of Montreal for eight years. I'm a branch manager at 10th and Columbia Street branch in New Westminster, a branch that just opened in April 2010. I oversee the daily operations of the branch, which has 10 employees, and I second the motion. Thank you, Samantha. Are there any questions? If there are no questions, I would ask those wishing to vote on the advisory resolution on the bank's approach to executive compensation to mark their yellow ballot. You are asked to either vote for or against the motion. Management recommends voting for the advisory resolution on the bank's approach to executive compensation. Will the representatives of Computershare Trust Company of Canada please collect the first ballot? Those with ballots, please raise your hand. Come over here. I think there's still one in the Is it? Nope. The next item of business is the shareholder proposals. The four proposals to be presented today were submitted by Mouvement d'éducation et de défense des actionnaires, MÉDAC. MÉDAC's proposals and their supporting comments were set out verbatim in the management proxy circular that was sent to shareholders. For your convenience, an extract from the management proxy circular containing the four shareholder proposals was provided to you this morning. You already have the blue ballot dealing with the four shareholder proposals. You will be asked to mark this ballot once each proposal has been presented. After we have dealt with the four shareholder proposals, the ballots will be collected and tallied. As we focus on the four shareholder proposals, we will address questions from the shareholders or proxy holders. The questions, of course, must relate to the proposal before the meeting at that time. I would ask that the presenters make their comments brief. Your positions are well stated in your written summaries and have been made available to everyone in this room. You should recognize as well that our responses are there as well, and we will not be commenting further on the proposals. Ms. O'Neil, we understand that MÉDAC was unable to attend today, and that you will be presenting the four proposals that they submitted. That's right. Thank you, Mr. Chairman. The first proposal is entitled Critical Mass of Female Expertise Within the Board. There certainly is a critical mass of research that indicates that as you add appropriately qualified women to a male-dominated body, you improve the performance of that body in the many ways set out in the supporting statement for the proposal. As the bank indicates, fully one-quarter of the nominees this year for the board are women. So in the mind of this filer, MÉDAC, you're halfway there. They suggest that you adopt a policy to take up the next decade to get to parity. I move this proposal. Thank you. May I have a seconder for the proposal? My name is Nooshin Farshichahi. I am from the Shareholder Association for Research and Education, and I second the proposal. Thank you. Is there further discussion on this proposal? Given there is no further comments, then please mark your blue ballot. This is shareholder proposal number one, dealing with the critical mass of female expertise within the board. Management recommends voting against shareholder proposal one. Ms. O'Neil, would you please present MÉDAC's second proposal dealing with the fairness ratio? Yes, thank you, Mr. Chairman. The fairness ratio would be a number fairly familiar to those of us with a focus on corporate governance. You look at CEO pay, and then you look at average pay within the organization, and you figure out how they relate to each other, what the ratio is. Is it 50 to one average CEO to average pay, or is it 150 or is it 400? What is that number? The proposal then asks that the board take a look at that and opine on what an ethically acceptable fairness ratio would be, and provide the justification for its thinking in the management proxy circular. I move this proposal. Thank you. May I have a seconder for that proposal? I second the proposal. Thank you. Is there further discussion? Given that there are no further comments, I would ask to mark your blue ballot for proposal number 2. Ms. O'Neil, would you please present MÉDAC's third proposal dealing with the closure of subsidiaries and branches in tax havens? Yes. Thank you, Mr. Chairman. The concern in this proposal is that to the extent that the bank has corporate components in tax havens around the world, those particular operations are not paying taxes in the majority of jurisdictions where they are indeed collected. To the extent that services are not being provided based on that income and that deficits are perhaps being incurred, they would encourage the bank to close branches and operations in tax havens. I move this proposal. Thank you. May I have a seconder? I second the proposal. Is there further discussion on this proposal? Given there's no further comments, I would ask those wishing to vote to mark their blue ballot. Proposal number three. Management recommends voting against shareholder proposal number three. Ms. O'Neil, would you present MÉDAC's fourth proposal dealing with additional information on comparison with peers compensation? Thank you, Mr. Chairman. This last proposal concerns the use of peer data on compensation. As the bank indicates, the data provides the foundation for establishing compensation targets. The shareholder is asking to get some more disclosure around it, the rank of business entities among peers, and some idea of how performance of the peers is used in determining compensation. It seems to me that so many proposals around compensation disclosure are shareholders asking to get closer to the conversation that the compensation committee has and that the board has about it. I think this proposal is very much in that category. So I move this proposal. Thank you. May I have a seconder? I second this proposal. Thank you. Is there further discussion on this proposal? Given there's no further comments, I would ask those wishing to vote to mark their blue ballot. Shareholder proposal number 4. Management recommends voting against this proposal. This brings us to the end of shareholder proposals. Will the representatives of Computershare Trust Company collect the blue ballots now? Those who have them raise their hands. I will now take questions from the shareholders. Questions should be by shareholders or proxy holders only and should be of a general interest to all shareholders. I would ask that in order for everyone to hear, please move to the closest aisle and wait for a microphone attendant to approach you, and then stand to be recognized. Just a reminder that questions from those on the Internet are welcome as well. Hello, I'm Geraldine Thomas-Flurer. I'm from the Saik'uz First Nation. I'd like to wish you all good morning. I want to thank the Coast Salish people, the Squamish, the Tsleil-Waututh, and the Musqueam for allowing us into their territories. I'm a member of Saik'uz First Nation. We are the Dakelh people, and my nation is one member of the Dakelh Alliance of Nations. We are five communities: Nadleh Whut'en, Nak'azdli, Takla, Wet’suwet’en, and my community, Saik'uz. I would like to honor the Houma First Nations of Louisiana, who gave me this blanket when I visited their community when BP had their oil spill, and I witnessed the devastation and the impacts to the Houma people. So this is in honor of them. We have come here today because we want to speak positively with you about the way the Bank of Montreal to build a relationship with indigenous nations for the future. To begin with, I would like to clarify an important point. Recently, we wrote a letter to you, Mr. Downe, as CEO, to express our concerns, and we want to correct some misconception. Last week, you kindly sent us a very quick response, but in that response, you stated that you would like to engage with stakeholders like our nations. We are happy to open a discussion and to engage with the Bank of Montreal on issues of concern to us. However, you and your team, as well as your shareholders, should understand First Nations are not stakeholders. With our lands and waters is ancient and profound. Our inherent title and rights and legal authority over our territories has never been relinquished through treaty or war. When your bank deals with indigenous nations, you are not dealing with stakeholders. You are dealing with sovereign indigenous peoples. Your bank has adopted a number of environmental and social commitments. We encourage you to work with indigenous people and to always live up to those commitments and to improve and expand on them in a way that recognizes our human rights as indigenous people. For example, we know your bank has committed to responsible investing and that you have endorsed the Equator Principles. We believe that these commitments will help your bank to limit its exposure to legal environmental risks, but we're concerned that these commitments may not go far enough in protecting your interests and in protecting our rights in international law. That is why we would like the Bank of Montreal to adopt a policy that would require the bank to consider whether its clients have obtained free prior and informed consent of affected indigenous peoples and not to assist in financing companies that do not obtain indigenous consent for their projects. For example, as we indicated in our letter to you, Mr. Downe, we have significant concerns about the role of your bank in helping to raise more than $286 million for Enbridge and its family of companies since 2007. Enbridge has proposed to build its Northern Gateway pipelines through our territories. They would carry oil from the tar sands through our lands and through many of our critical salmon-bearing rivers. The salmon sustain our people and our culture. These waters, this fish, the wildlife that they sustain are the lifeblood of our people. Our people belong to the land, and we continue to live off the land every day. An oil spill from Enbridge's proposed pipeline will happen. A single spill could destroy our way of life and our culture. 80 First Nations say this project is against our laws, but it seems Enbridge is planning not to respect our decision. They plan to go ahead and to ignore the more than 80 nations who have banned their pipelines from our territories against their will. It will erode the environmental and social commitments that your bank has already made. The right way to move forward is to adopt responsible and ethical policies that ensures all clients have respected indigenous rights, including the right to free prior and informed consent wherever they operate or propose these types of projects worldwide. We would like to engage with your bank in a discussion about this and on behalf of to learn who we are and what is at stake for us. The decisions that all of you in this room make deeply affect our people and our traditional territories. They affect all generations that have not yet been born. We live a long way from your First Canadian Place in Toronto, but we are all connected. Thank you. Do you want to comment? Thank you very much for those comments. They're most welcome, and we do have a great investment in pursuing positive relationships with indigenous nations, and we're looking forward to the opportunity to sit down with your chiefs. Thanks for coming today. Okay. Good morning. I'd like to thank the Squamish Nation for allowing us to do business on their traditional territories. My name is Anne Catlow. I come from the Nadleh Whut'en First Nations. Nadleh Whut'en is defined as where the salmon return. One of the areas that will be crossed by the proposed Enbridge pipeline is the Stuart River. There are three nations that take their food from the Stuart River: Nak'azdli, Tl'az T'en, and Takla at the headwaters. For the last 10 years, those three nations have sacrificed and not taken any of the early Stuart to rebuild that stock, and yet Enbridge, by proposing to build that pipeline, is threatening that stock of fish, and I'm just hoping that you guys would really consider the First Nations' voices in regards to our history. Nadleh Whut'en, we had practiced the weir. Three years ago, three different stakes were pulled from our river, and the earliest one tested at 1272 AD. So we've been around for a long time, as our history dictates. The other area that is of huge concern that Enbridge plans to go into is the Sutherland Valley. The Sutherland Valley, in 2004, had a landslide, and that is a natural fault within the Sutherland Valley, and there's also a river, the Sutherland River, that goes into the Babine Lake. The Sutherland house the spring salmon spawn in the Sutherland River. So these are areas of critical and serious concern to the Nadleh Whut'en people, and I just wanted to come here today and to ask your people to consider what is the impacts of the Enbridge pipeline to our nations. Thank you. Thank you. My name is Jasmine Thomas. I am a member of the Secwépemc community, and we are a community to the Yinka Dene Alliance. We have traveled far to come here today to tell you our concerns, to tell you how concerned we are of BMO's assistance with corporations and other industries that are impacting our territories. I see this sign here, "Making money makes sense." Already in the room today, we have heard concerns of different human rights abuses that are being sponsored by financial institutions. I am sure your shareholders, board of directors want to ensure that BMO holds the highest environmental and human rights standards. I am sure many of you do not want to contribute to projects that propose to destroy an entire way of life, that strip away the rights of workers, of our brothers and sisters in Wisconsin. We are all here together. We got to live in this world together, and you want to make your money make sense. You do not want to invest in projects that risk human rights, that risk indigenous people's rights, but also to consider the other human rights that have been put on the table here today from those struggling in Wisconsin and from the nurses union here in B.C. as well. You have heard our concerns. We would like to see action, and we would like to see your policies change that recognize those concerns. Thank you. We appreciate your comments. Are there more questions from the floor? Sir, thank you. Good morning. My name is Steve Carley. I am personally a proud shareholder of BMO, but I am also here on behalf of NEI Investments, and NEI Investments is a long-term institutional shareholder. We have also had a long-term, very productive dialogue with many members of BMO. I do have a question with regards to compensation and the peer group. I probably do not need to make it in front of all these people. Recognizing it is a Q&A session, I am just wondering if someone from the board would be willing to answer the question or if Bernie Martinson is in the room, who we have spoken to but I have not yet met. Thank you. I am sure someone would be delighted after the meeting. Bob Astley is chairman of the compensation committee, on the board, and maybe you could seek him out at the end of the meeting. Thank you very much. That would be great. Are there other questions from the floor? Hello, good morning. My name is Max Cersei. I am just interested in this new business of sports soccer stadium sponsorship, whether it is generating any positive return or it is just a service to the community. I do not know. A question close and dear to Bill's heart. Well, thank you very much for the question. I think there are two elements to sports sponsorship. It is a contribution to the community, and it takes place at the level of minor league or junior or amateur sport, and it goes up to the more visible venues like the Vancouver Whitecaps as an example. But it has real advertising, and profile value as well. It associates the bank with sport where many customers are in attendance. It raises the visibility of the bank, and at the same time, as you mentioned, it does reinforce the commitment to the community. So we view it as a very positive way of promoting the bank. Thank you. Are there any more questions from the floor? We do have a few questions from the Internet, I just think given the hour, we will respond, but we will respond to those by email. We will make sure that we respond to each of them. I know the scrutineers have completed their report on the preliminary results of the balloting. I call on Steve Gilbert to read these preliminary results. Meeting hereby confirm the following as a result of votes by ballots. For the election of directors, no director standing for election today received less than 95.8% of the votes cast for a director. On the appointment of auditors, approximately 99% of the votes were in favor, and less than 1% of the votes withheld on this proposal. For the amendment to the bank's bylaws, approximately 99% were in favor and less than 1% of the votes were against. For the vote on the advisory resolution, approximately 92% of the votes were in favor and 7% against. On shareholder proposal number one, approximately 18% of the votes were in favor, and approximately 81% voted against. On shareholder proposal number two, approximately 18% of the votes were in favor, and approximately 81% voted against. On shareholder proposal number three, approximately 11% were in favor and approximately 88% voted against. On shareholder proposal number four, approximately 18% were in favor and approximately 81% of the votes were against. Those, Mr. Chairman, are the result of the votes by ballot. Thank you. I therefore declare that the 16 nominees listed in the management proxy circular are duly elected as directors. KPMG LLP is duly appointed as auditors for the ensuing year. The amendments to the bank's bylaws have been approved. The advisory resolution on the bank's approach to executive compensation has been approved. The four shareholder proposals have been defeated. Should any shareholder wish to know the individual results for directors and the results of shareholder proposals, this information will be available shortly at the registration desk, and the information will also be posted on our website. I would also like to advise you that copies of the bank's public accountability statement are available in the foyer should you wish to pick one up as you are leaving. I would like to thank all the people who were involved today's meeting, including those who handled closed captioning and the French interpretation for us today.