Bank of Montreal buys CSFBDirect

Bank of Montreal buys CSFBDirect

Bank of Montreal is to acquire New Jersey-based online brokerage CSFBDirect from Credit Suisse First Boston for $520 million.

John Mack, Credit Suisse First Boston's cost-cutting chief executive officer comments: "This divestiture is part of our strategy that will allow us to focus on our core businesses while reducing costs. We can also concentrate exclusively on increasing our market share in those areas where we already have a significant leadership position."

CSFBdirect is the sixth acquisition by Bank of Montreal in the US in two years. It adds nearly a half a million active client accounts, one million total accounts, to the bank's US wealth management business.

"CSFBdirect gives us the enhanced distribution to continue to attract an affluent client base and positions us to capture increasing market share," says William Downe, deputy chair, Bank of Montreal and CEO, BMO Nesbitt Burns. "This acquisition is perfectly aligned with our strategy, which is focused on building out a full suite of wealth management products and services, offering direct investing, full service investing, private banking, mutual funds and institutional money management to clients across the U.S."

Upon completion of the deal, which is set close in February 2002, CSFBdirect will be integrated with Harris InvestorLine to create a new firm called Harris Direct Investing. The unit will be headquartered in Jersey City, and led by Bruce Schwenger, head of global direct investing for Bank of Montreal's Private Client Group.

The acquisition brings the bank's North American direct investing base to 850,000 active accounts and 1.5 million client accounts in total, and $25 billion in assets under administration.

Additionally, CSFB announced that Bank of Montreal has also signed multi-year contracts as clients of Pershing, CSFB's clearing and settlement unit, and iNautix, Pershing's technology unit.

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