UPDATE 2-BMO targets small business lending, adds staff

* Bank hiring 150 specialists, could double that

* Will focus on businesses with sales under C$5 mln

* Analysts see business-driven revenue growth
(Adds background, interview with commercial banking head)

By Cameron French

TORONTO, March 30 (Reuters) – Bank of Montreal (BMO.TO: Quote, Profile, Research),
Canada’s fourth-largest lender, is targeting the Canadian small
business segment as it hopes to offset an expected slump in
personal loan growth.

The bank is in the process of adding 150 small-business
banking specialists that will focus on business with sales
under C$5 million ($5.2 million).

Gail Cocker, BMO’s head of commercial banking, said in an
interview on Wednesday that number could rise to 300 in the
near future as the bank moves further into the sector.

“This is a large and growing segment that has unique needs
that we need to pay attention to and understand, and within
that size group itself there’s a lot of opportunity,” she

Cocker said small business activity accounts for a about 30
percent of Canadian GDP, giving it a high ceiling for
opportunity, particularly as growth in personal loans and
mortgages is expected to slow. Analysts and bank executives say
they expect business loan growth to be partially fill the gap.

“We know that the small business segment is really
important to the Canadian economy. It creates tons of jobs and
there are growth opportunities there,” she said.

She said the banking services provided to the small
business owners well go well beyond simple financing.

“They need solutions for managing their cash, for helping
them to have better reporting for their tax filing and that
sort to thing,” she said. “How do they collect faster? How do
they pay easier? It’s a whole bundle of solutions that we can
help them with.”

BMO’s core business is its Canadian personal and commercial
bank, but it has also been aggressively expanding in the United
States, most recently with a $4.1 billion takeover of Wisconsin
lender Marshall & Ilsley (MI.N: Quote, Profile, Research) launched last fall.

The bank also has a growing presence in China.

For the small business push, BMO has already hired 60
specialists in British Columbia and is in the process of hiring
90 more in Alberta, Ontario, Quebec and the Atlantic provinces
throughout this year.

“Our intention is that this is a multiyear initiative, so I
can see that doubling, easily doubling in the nearer term,” she

“It’s a fairly significant commitment to this

($1=$0.97 Canadian)
(Editing by Jeffrey Hodgson)

UPDATE 2-BMO targets small business lending, adds staff