BMO Wealth Management: Defining a New Path Forward

How BMO Wealth Management Expanded Their Value Proposition 

While finding itself at a crossroads in 2020, BMO Wealth Management always kept in sight its No. 1 priority: deliver a world-class experience for their advisors and clients.

They knew that to achieve this and enhance their presence in the wealth management market, they needed to focus on what was essential for them to “own” and outsource the rest. By partnering with LPL Financial they were able to accomplish this.

“Choosing LPL as a partner has played a big part in transforming our wealth program at BMO,” said Wallace Harris, Jr., president, BMO Investment Services. “We are freed up to focus our time and resources on what we do best — helping our advisors provide the best service to their clients.”

Partnering for Winning Outcomes

Similar to many other financial institutions, BMO was facing resource constraints, increased compliance and supervision responsibilities, and the need to deliver a truly competitive offering to their advisors and clients. 

With a desire to expand their value proposition and build an improved business model that would help them thrive in a competitive market, they went through an arduous RFP process. In the end, they selected LPL as a partner to address and accomplish three primary goals.  

Goal #1: Offer a world-class service experience.
Action: Outsource wealth management infrastructure operations to LPL.
Winning outcomes: Reduced the need for non-producing full-time employees, simplified vendor management, and eliminated incremental investment required to stay current.

Goal #2: Enhance growth and profitability.
Action: Offer competitive products backed by LPL’s deep subject matter expertise and transfer regulatory and compliance risk. 
Winning outcomes: Minimized risk profile, eliminated the need for incremental investments to remain compliant, and freed up resources to help grow the business.

Goal #3: Deliver a competitive technology stack.
Action: Adopt and leverage LPL’s state-of-the-art technology.
Winning outcomes: Streamlined operations, improved data security, and facilitated seamless communication between advisors and clients.

Scaled for Growth

Since BMO’s retail brokerage and advisory business joined LPL in 2021, the transformation they’ve experienced has enabled growth within their wealth management business. By leveraging LPL’s continued investment in technology and tools — a sustained capital investment of $360M+ annually — BMO is staying ahead of the innovation curve. 

“Before partnering with LPL, BMO struggled with managing its technology offering. Now, we’re able to leverage LPL’s constant, meaningful investment in technology,” said Pete Schmidt, CFP®, ChFC, National Director of Sales, BMO Investment Services.

BMO now has the time and resources to deepen their strategic efforts to build a world-class experience. In particular, with the operational scale the LPL partnership has provided, BMO has had a dramatic drop in not-in-good-order (NIGO) rates from 40% to 2%. Schmidt said, “The goodwill that the lower NIGO rates have afforded has been a positive lift to our staff, advisors, and investor customers.”

Taking it a step further, BMO’s wins have also allowed them to embark on a successful acquisition strategy. In 2023, BMO acquired Bank of the West relatively quickly, positioning the firm to consider the possibilities for more acquisitions in the future.

Ready for What’s Next

As he reflects on BMO’s partnership with LPL, Harris shared, “LPL’s robust suite of wealth management services are tailored to meet the diverse needs of BMO Investment Services advisors and their clients. The LPL platform equips advisors with innovative tools and resources, enabling them to create personalized financial plans and investment strategies. This approach has enhanced client satisfaction and led to stronger client-advisor relationships.”