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A Bank of Montreal or BMO location in Toronto.Deborah Baic/The Globe and Mail

Bank of Montreal's third-quarter earnings extended a streak of stable profits, but the lender's bottom line has yet to demonstrate consistent growth.

BMO made $1.13-billion, or $1.67 per share, up just 1 per cent over the year prior. After adjusting for one-time items, the bank made $1.73 per share, beating analyst estimates of $1.66 per share.

Capital markets and Canadian banking continue to be lender's bright spots.

At home, BMO made $526-million from personal and commercial banking, 8 per cent more than the same period a year prior. Retail loan growth was 7 per cent relative to 2013, while commercial loan growth was 9 per cent.

In capital markets, BMO benefited from the same market strength as its peers, reporting a second straight solid quarter. Earnings amounted to $306-million, up 14 per cent from the year prior, largely boosted by underwriting and advisory fees, and in line with the hot second quarter.

In the U.S., BMO's Midwest-based personal and commercial bank brought in $147-million, up only 2 per cent from the year prior. Although commercial and industrial loan growth is booming at 18 per cent, total earnings haven't demonstrated the big turnaround that investors have long waited for.

Wealth management earnings climbed to $164-million, up 25 per cent, boosted by the acquisition of F&C Asset Management as well as hot markets that provide for higher fees. However, the bank's insurance arm suffered last quarter, with profit falling to $48-million, down from $93-million a year prior.

BMO's total provisions for credit losses jumped to $130-million in the third quarter, up $54-million over the same period in 2013.

While BMO was historically known for commercial lending, chief executive officer Bill Downe has pushed hard to expand its retail banking presence. To win market share, BMO has been particularly aggressive on mortgage pricing, offering low rates during periods such as the spring market when home buying is typically hottest.

Mr. Downe recently acknowledged that his retail banking team has learned a lot about the Canadian market in the past four years, and that has helped the bank be more competitive. However, the one area where BMO is still behind most of its rivals is the credit card business, so the bank is now pushing hard to expand its footprint.

South of the border, the slow-to-recover U.S. banking market has hung over the bank. Since buying Midwest-based Marshall and Ilsley for $4.1-billion (U.S.) in 2010, BMO has yet to generate a string of strong U.S. personal and commercial banking profits.

Although the U.S. economy is roaring back to life, banks of all sizes are looking to lend more money south of the border, particularly to commercial and industrial clients. For this reason, loan growth is encouraging, but the underlying margins are getting squeezed.