Bank of Montreal Financial on Tuesday reported a rise in profit for the second quarter ended April 30. The bank said retail and investment banking improved, while loan loss provisions were lower.

Net income was $409 million, up or 77¢ a share in the quarter, up from $301 million, or 57¢, a year ago.

“BMO remains solidly on track to achieve its financial targets for 2003,” said Tony Comper, chairman and CEO, in a news release. “The continuation of solid growth in personal and commercial banking volumes and improving credit performance are driving higher profitability.”

The bank said its provision for credit losses was $120 million, down from $320 million a year ago, and is the most significant factor contributing to improved year-over-year performance. Results in the second quarter of 2002 included a $140 million provision for credit losses related to BMO’s exposure to Teleglobe Inc.

Revenue during the quarter slipped to $2,208 million, down $14 million from a year earlier. Volume growth and improved net interest margins in Canadian retail and business banking were more than offset by the effects of low client- transaction volumes in other operating groups and the weaker U.S. dollar.

The expense-to-revenue ratio was 67.2%, up from 66.4% a year ago, but improved from the first quarter’s ratio of 67.9%.

In Canada, Personal and Commercial Client Group revenue was up 9% and net income up 15% from the second quarter of 2002.

Investment Banking Group net income was up 7% from a year ago despite difficult market conditions.

Private Client Group earnings in the quarter were down just slightly from a year ago in the continued challenging operating environment, but cash earnings and earnings excluding acquired businesses were higher.