SELECT id, `name`, primary_key, `key`, treemapgroup, name_cn, zacks_table_name, compare_key, compare_display_name from gurufocu_main.financial_definition where termpagedisplay=1 and `key` = 'Long-Term Debt' BMO (Bank of Montreal) Long-Term Debt & Capital Lease Oblig
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Bank of Montreal (Bank of Montreal) Long-Term Debt & Capital Lease Obligation

: $104,042 Mil (As of Jan. 2024)
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Long-Term Debt & Capital Lease Obligation is the debt and capital lease obligation due more than 12 months in the future. Bank of Montreal's Long-Term Debt & Capital Lease Obligation for the quarter that ended in Jan. 2024 was $104,042 Mil.

Warning Sign:

Bank of Montreal has been issuing new debt. Over the past 3 years, it issued CAD 2.1 billion of debt. But overall, its debt level is acceptable.

LT-Debt-to-Total-Asset is a measurement representing the percentage of a corporation's assets that are financed with loans and financial obligations lasting more than one year. The ratio provides a general measure of the financial position of a company, including its ability to meet financial requirements for outstanding loans. It is calculated as a company's Long-Term Debt & Capital Lease Obligation divides by its Total Assets. Bank of Montreal's Long-Term Debt & Capital Lease Obligation for the quarter that ended in Jan. 2024 was $104,042 Mil. Bank of Montreal's Total Assets for the quarter that ended in Jan. 2024 was $986,934 Mil. Bank of Montreal's LT-Debt-to-Total-Asset for the quarter that ended in Jan. 2024 was 0.11.

Bank of Montreal's LT-Debt-to-Total-Asset declined from Jan. 2023 (0.12) to Jan. 2024 (0.11). It may suggest that Bank of Montreal is progressively becoming less dependent on debt to grow their business.

Bank of Montreal Long-Term Debt & Capital Lease Obligation Historical Data

The historical data trend for Bank of Montreal's Long-Term Debt & Capital Lease Obligation can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Bank of Montreal Annual Data
Trend Oct14 Oct15 Oct16 Oct17 Oct18 Oct19 Oct20 Oct21 Oct22 Oct23
Long-Term Debt & Capital Lease Obligation
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 96,479.64 92,333.94 83,254.79 92,460.37 102,245.48

Bank of Montreal Quarterly Data
Apr19 Jul19 Oct19 Jan20 Apr20 Jul20 Oct20 Jan21 Apr21 Jul21 Oct21 Jan22 Apr22 Jul22 Oct22 Jan23 Apr23 Jul23 Oct23 Jan24
Long-Term Debt & Capital Lease Obligation Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 102,477.28 95,722.34 103,070.17 102,245.48 104,041.57

Bank of Montreal Long-Term Debt & Capital Lease Obligation Calculation

Long-Term Debt is the debt due more than 12 months in the future. The debt can be owed to banks or bondholders. Some companies issue bonds to investors and pay interest on the bonds.

Long-Term Capital Lease Obligation represents the total liability for long-term leases lasting over one year. It's amount equal to the present value (the principal) at the beginning of the lease term less lease payments during the lease term.

The interest paid on companies' debt is reflected in the income statement as interest expense. If a company has too much debt and it cannot serve the interest payment on the debt or repay the matured debt, the company risks bankruptcy. Peter Lynch famously said: A company that does not have debt cannot go bankrupt.

A company's long term debt may have different dates of maturity and interest rates, depending on the terms.

Usually a company issues long term debt to pay for its capital expenditures. Borrowing allows the company to do things that otherwise cannot be done with only the capital it has. But debt can be risky.

Bank of Montreal  (NYSE:BMO) Long-Term Debt & Capital Lease Obligation Explanation

LT-Debt-to-Total-Asset is a measurement representing the percentage of a corporation's assets that are financed with loans and financial obligations lasting more than one year. The ratio provides a general measure of the financial position of a company, including its ability to meet financial requirements for outstanding loans. A year-over-year decrease in this metric would suggest the company is progressively becoming less dependent on debt to grow their business.

Bank of Montreal's LT-Debt-to-Total-Asset ratio for the quarter that ended in Jan. 2024 is calculated as:

LT-Debt-to-Total-Asset (Q: Jan. 2024 )=Long-Term Debt & Capital Lease Obligation (Q: Jan. 2024 )/Total Assets (Q: Jan. 2024 )
=104041.57/986934.366
=0.11

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Buffett says that durable competitive advantages carry little to no long-term debt because the company is so profitable that even expansions or acquisitions are self financed.

We are interested in long term debt load for the last ten years. If the ten years of operation show little to no long term debt, then the company has some kind of strong competitive advantage.

Warren Buffett's historic purchases indicate that on any given year, the company should have sufficient yearly net earnings to pay all long term within 3 or 4 year earnings period. (e.g. Coke + Moody's = 1yr)

Companies with enough earning power to pay long term debt in less than 3 or 4 years is a good candidate in our search for long term competitive advantage.

BUT, these companies are targets for leveraged buy outs, which saddles the business with long term debt.

If all else indicates the company has a moat, but it has ton of debt, a leveraged buyout may have created the debt. In these cases the company's bonds offer the better bet, in that the companyÂ’s earnings power is focused on paying off the debt and not growth.

Important: little or no long term debt often means a Good Long Term Bet

Bank of Montreal Long-Term Debt & Capital Lease Obligation Related Terms

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Bank of Montreal (Bank of Montreal) Business Description

Industry
GURUFOCUS.COM » STOCK LIST » Financial Services » Banks » Bank of Montreal (NYSE:BMO) » Definitions » Long-Term Debt & Capital Lease Obligation
Comparable Companies
TSX:BNS TSX:CM TSX:TD TSX:NA TSX:RY JPM BAC SHSE:601398 WFC SHSE:601288 SHSE:601988 SHSE:601939 LSE:HSBA ASX:CBA C TSE:8306 XSWX:UBSG TSE:8316 XMAD:SAN ASX:NAB
Traded in Other Exchanges
BZZ:Germany BZZ:Germany BMO.PR.F.PFD:Canada BMO.PR.E.PFD:Canada BMO.PR.Y.PFD:Canada BMO.PR.W.PFD:Canada BMO.PR.T.PFD:Canada BMO.PR.S.PFD:Canada BMO:Canada
Address
129 rue Saint-Jacques, Montreal, QC, CAN, H2Y 1L6
Website
https://www.bmo.com
Bank of Montreal is a diversified financial-services provider based in North America, operating four business segments: Canadian personal and commercial banking, U.S. P&C banking, wealth management, and capital markets. The bank's operations are primarily in Canada, with a material portion also in the U.S.
Executives
Vinita Lee Piper director 712 WILCREST, SUITE 3020, HOUSTON TX 77042