Included are all shareholdings of 1% and greater. Source: Orbis Database, October 2018.

BMO makes a moderate attempt to position itself as a climate-conscious investor, emphasizing its spending on “climate change initiatives” to the tune of C$237 million in 2016, including $170 million in net new lending commitments in the renewables sector, and $50 million in net new financings (debt and equity) in renewables.¹ Meanwhile, $17.3 million was committed to its own corporate operations, including carbon neutrality costs, wind, hydroelectric facilities, and run-of-river hydro power operations.² However significant these may be, BMO’s renewable portfolios pale in comparison to its less advertised holdings in oil and gas.

As of March 2016, BMO held C$16.3 billion in oil and gas loans (this included both drawn and undrawn commitments).³ However, these numbers exclude BMO’s fixed income financing activities—which represent a considerable amount of its influence in Canada’s oil and gas industry. These financing agreements offer targeted financial support to oil companies that is often project-specific. They are often essential in enabling companies to develop major oil and gas infrastructure such as pipelines and refineries. From 2015 to 2017 BMO’s debt and equity investments in the oil sands between totalled $US 7.7 billion—making it the fifth-largest oil sands financier.⁴

BMO’s investments in other forms of “extreme oil” are also notable: for example, in the same three-year period it invested US$199 million in Arctic oil sources.⁵ In September 2018, BMO acquired $3 billion in oil and gas loans from Deutsche Bank, proclaiming, “We are one of the leading energy investment banks in North America.”⁶ Beyond these lending commitments, BMO holds significant shares in large Canadian and international fossil fuel firms. The table below shows the bank’s top 15 shareholdings in fossil fuel companies, through its funds.

Source: Orbis Database, February 2019.

Along with Canada’s other big banks, BMO is a signatory to the Equator Principles, a framework for determining whether potential business activities (e.g., financing) impinge on the protection of natural habitats or Indigenous rights. Yet its grade from CDP (the Carbon Disclosure Project—a global disclosure program for corporations to track and measure their environment impact)—is poor. BMO received a C in 2018. BMO also earned a D– on the 2018 Fossil Fuel Finance Report Card.⁷ It was listed as one of the “biggest backsliders” on extreme oil investment, having increased its financing by $778 million between 2016 and 2017.⁸

Climate risk and responsibility

BMO and most other major Canadian banks have been cited as laggards for failing to acknowledge climate risk.¹⁰

BMO has never publicly acknowledged climate risk to its assets. In 2016 CEO Bill Downe issued a statement rejecting the concept altogether, stating that, in reference to a recent drop in oil prices, “a market price correction does not mean that an enviable national asset has suddenly become a liability.” He went on to reassure clients that oil prices would recover and that the “economic fundamentals remain positive.”¹¹ Downe is a former member of the US Federal Advisory Council, a collection of elite bankers that advise the Federal Reserve on monetary and financial practices.¹²