The Bank of Montreal’s fourth-quarter profit fell to $1.19 billion as it was hit by a restructuring charge related primarily to severance that will affect about 5% of the its global workforce, the bank announced Tuesday.

The quarter ended Oct. 31 included a $357-million restructuring charge as a result of the bank’s decision to accelerate delivery of digitization initiatives and simplification of the way it does business.

Part of reason for accelerations is lower margins from its personal and commercial banking business in the United States as a result of reduced interest rates as well as slower U.S. economic growth expected next year, officials said.

BMO didn’t reveal details about where or when the job cuts will occur but it had about 45,513 employees at the end of October. A five-per-cent cut suggests about 2,275 jobs would be affected.

Chief financial officer Tom Flynn said the efficiency initiatives announced Tuesday will provide annual savings of $200 million in fiscal 2020, which began Nov. 1, and about $375 million by the first quarter of 2021.

“I would expect the savings that we’ve talked about to flow through each of our businesses in a fairly representative way…both by operating group and by geography,” Flynn told analysts on a conference call.

Based on the geographic breakdown of BMO’s workforce, the restructuring could affect roughly 1,500 jobs in Canada and 675 in the United States.

The bank also said Tuesday it will now pay a quarterly dividend of $1.06 per share, up three cents from its previous rate.

The increased payment to shareholders came as BMO reported a profit that amounted to $1.78 per share for the quarter ended Oct. 31.

The result was down from a profit of nearly $1.70 billion or $2.58 per share a year ago, when the fourth quarter included a $203-million after-tax benefit from the remeasurement of an employee benefit liability.

On an adjusted basis, BMO says it earned nearly $1.61 billion in the quarter, up from $1.53 billion in the same quarter last year.

The adjusted profit amounted to $2.43 per share, up from $2.32 per share a year ago.

Analysts on average had expected a profit of $2.41 per share, according to financial markets data firm Refinitiv.

Bank of Montreal shares were down 2.5% in early trading, dropping $2.64 to $98.07 at the Toronto Stock Exchange.