I am Canadian, BMO is in Canada. Houses in Canada are incredibly expensive now, people are overextending themselves to get mortgages and buying homes is the holy-grail no matter what it implies for an increasingly high number of Canadians. We also dodged the credit crisis mess. Canadian banking system is viewed and touted as the strongest in the World, still nowadays! This is deconcerting : there was no capital raise in Canada while there was cleansing worldwide and massive capital raises everywhere. Some other countries avoided banking meltdown, but since they were emerging markets, they were already provisionned with higher equity ratios to be ready for what is considered as ''usual shocks'' in emerging market economies.

Maybe BMO rates an hold. But with p/e around 13, market cap / tangible equity at 1.75 and equity tier 1 ratio at 10%, it is not the best growth investment around, it is far from a bargain and maybe that some Canadian risks are not priced in. I strongly prefer BSBR with market cap / tangible equity at 1.6, p/e well under 10, annual growth in excess of 20% in a major emerging market with good state solvency, growing middle class and rich resources (like Canada). Thus I would end BMO pick. Other canadian banks look more expensive than BMO so I would say the same.

One of them, BNS is touted for success in Latin America. If this justifies its fatty valuations and if Latin America is really a success factor, then why not buy BMA and BSBR to be 100% Latin America with 20%+ tier 1 ratios and cheap valuations ?