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CORRESP
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 CORRESP

 Tayfun Tuzun
 Chief Financial Officer

 BMO Financial Group
 320 S. Canal Street
 Chicago, IL, 60606 U.S.
 Tel.: (312) 461-2300
 Tayfun.Tuzun@bmo.com
 March 14 th , 2025
 Mengyao Lu, Lory Empie Division of Corporation Finance, Office
of Finance Securities and Exchange Commission Washington,
D.C. 20549

 Re:
 Bank of Montreal (the “ Bank ”)
 Form 40--F for Fiscal Year ended October 31 2024
 Filed March 3, 2025 File No. 001--13354 Dear Ladies and Gentlemen:
 This letter responds to the comment letter (the “ Comment Letter ”) from staff (“ Staff ”) of the Division of Corporation Finance
of the Securities and Exchange Commission, dated March 3, 2025, relating to our Annual Report on Form 40--F for the fiscal year ended October 31, 2024 (the “ 2024 40 -F ”). To facilitate the Staff’s review, the Bank has included in its response the numbered questions as
raised in the Comment Letter and provided responses immediately following each numbered comment. The Bank reports its financial information in Canadian
dollars ($) and all monetary amounts set forth herein are expressed in Canadian dollars, unless otherwise stated. Transaction background
 Before responding to the Staff Comments below, we believe it will be helpful to provide some context for the transactions in the order that they occurred.
 Agreement to acquire Bank of the West (“BOTW”) signed December 20, 2021
 On December 20, 2021, we signed a definitive agreement (such date, the “ signing date ”) with BNP Paribas to acquire BOTW and its
subsidiaries for a cash purchase price of US$16.3 billion, or US$13.4 billion net of an estimated US$2.9 billion of excess capital (at closing). BOTW would be merged into our US subsidiary BMO Harris Bank and the transaction was
expected to close in either Q4 of fiscal 2022 or Q1 of fiscal 2023, subject to regulatory approvals.

 Period between signing the definitive agreement and the closing of the acquisition (December 2021
through January 2023) When we signed the agreement to acquire BOTW in December 2021, we were entering a period of rising interest rates, and we
expected rates to continue to rise until the closing date (as defined in the next section). Increases in interest rates would inherently reduce the fair value of BOTW’s fixed rate loans and deposits, leading to higher goodwill on closing. This
would negatively impact our capital ratios at the closing date, because goodwill is treated as a deduction from capital under Basel III rules. Therefore, anticipating that interest rates would increase and lead to a higher goodwill balance, we
entered into certain transactions to preserve the economics of the acquisition as at the signing date:

 1)
 We entered into simple pay fixed receive floating rate interest rate swaps (“ interest rate
swaps ”) to economically manage the fair value risk such that the bank would benefit from fair value gains in a period of rising interest rates, resulting in an increase in retained earnings. The interest rate swaps were created to match the
duration and characteristics of the fixed rate portfolio being acquired. This would improve our capital position by providing an offset to the negative capital impact from the increase in the value of goodwill in the period between the signing and
closing dates. These interest rate swaps did not qualify for hedge accounting and were measured at fair value on the Consolidated Balance Sheet, with changes in fair value reflected in the Consolidated Statement of Income (marked to market), in
accordance with IFRS 9 – Financial Instruments (“ IFRS 9 ”). Please see our response to Staff Comment 1(a) below.

 2)
 While these interest rate swaps created an exposure to interest rate risk on our Consolidated Balance Sheet as
described above, there was no on-balance sheet offset during the period between signing date and the closing date. As a result, a portfolio of matched duration, fixed rate U.S. Treasuries and, to a much lower
extent, covered bonds, Canadian provincial, and pension bonds ( “other instruments” ) were purchased to maintain an economic risk neutral on-balance sheet position. As noted below in our
response to Staff Comment 1(a), these U.S. Treasuries and other instruments were measured at amortized cost under IFRS 9.
 Acquisition close (February 1, 2023) On the close
of the acquisition on February 1, 2023 (such date, the “ closing date ”), the purchase price equation included US$2.3 billion ($3 billion) from loan and deposit fair value discounts, US$2.6 billion ($3.5 billion) from
securities discount and US$0.7 billion ($0.9 billion) from other interest rate-related purchase accounting adjustments (totalling US$5.6 billion ($7.4 billion)). This compared to our signing date assumption of US$1 billion ($1.3
billion) from these components. The additional capital required of US$4.6 billion ($6.1 billion) due to the decrease in the fair values of the fixed rate portfolio acquired and the offsetting increase in goodwill, was largely covered by higher
cumulative retained earnings of US$4.4 billion ($5.7 billion) from the interest rate swap transactions described above.

 After acquisition close
 After the closing date, the interest rate swap transactions described above were closed out to crystalize the retained earnings/capital position. However, we
still held the U.S. Treasuries and other instruments, which were then in an economic unrealized loss position due to the increase in rates since they were acquired.
 As described in the previous section, due to the impact of the increase in interest rates, the fixed rate portfolio acquired on the closing date had a larger
fair value discount than it would have had based on rates at the signing date. This larger fair value discount (~$6.1 billion) would accrete to net interest income over the remaining term of the acquired fixed rate portfolio.
 The unrealized loss on the U.S. Treasuries and other instruments, purchased at the signing date, provided an economic offset for the increase in fair value
discounts on the acquired fixed rate portfolio. We did, however, want to hedge changes in fair value arising due to interest rate changes after the
closing date. As a result, we entered into new at-market interest rate swaps and designated them into fair value hedge accounting relationships under IAS 39 Financial Instruments: Recognition and
Measurement (“IAS 39”) for their remaining duration, thus hedging changes in the unrealized losses on the date of the designation ($5.7 billion). By hedging any impact of future rate changes, the $5.7 billion loss would
naturally accrete through net interest income, providing an offset to the additional purchase accounting accretion in net interest income arising from the acquired fixed rate portfolio over time, bringing us back to our original business case.
 The transactions explained above helped to preserve the economics of the acquisition that we anticipated at the signing date. We have responded to your
specific questions in more detail below.

 Staff Comment #1
 We note your disclosure that upon announcement of the agreement to acquire Bank of the West, you entered into interest rate swaps and purchased a
portfolio of matched duration U.S. Treasuries and other instruments to economically hedge the impact of interest rates on your capital ratios at close. We also note that subsequently on close, you placed the majority of these U.S. Treasuries and
other instruments in fair value hedge relationships with new interest rate swaps. Please respond to the following for us:

 a)
 Summarize your accounting analysis for these events and cite the authoritative guidance on which you
relied for your conclusions. Interest Rate Swaps
 We assessed the eligibility of our economic exposure to changes in the purchase equation (fair value of acquired assets/liabilities/goodwill) due to increasing
rates as a hedged item under IFRS, but concluded it was not an eligible hedged item. The bank applies the requirements of IAS 39 for hedge accounting
purposes. The exposure to rising rates on the acquisition would be created from changes in fair value of fixed rate financial instruments. We considered fair value hedge requirements under IAS 39, which stated that the hedged item must be a
recognized asset or liability or an unrecognized firm commitment, or a portion thereof. [IAS 39.78, IAS 39.86(a)] . Given the transaction is off-balance sheet until close, the exposure did not qualify
for hedge accounting and therefore the interest rate swaps were treated as economic hedges. As a result, the interest rate swaps were marked-to-market through Trading Revenue Non-Interest Revenue in the Consolidated Statement of Income in accordance with IFRS 9
 Financial Instruments . [IFRS 9.4.1.4 related to measurement of derivatives at fair value and IFRS 9.5.7.1 related to recognition of these gains/losses in profit or loss]
 U.S. Treasuries and Other Instruments Under IFRS 9,
Chapter 4 Classification , accounting for financial assets is dependent on both business model and contractual cashflows. To qualify for amortized cost treatment under IFRS 9 4.1.2, the following two conditions must be met:

 a)
 The financial asset is held within a business model whose objective is to hold financial assets in order to
collect contractual cash flows; and

 b)
 The contractual terms of the financial asset give rise on specified dates to cash flows that are solely
payments of principal and interest (SPPI) on the principal amount outstanding. The portfolio of matched duration, fixed rate U.S.
Treasuries and other instruments had cash flows that met the above SPPI condition, and we intended to hold until maturity to provide an offset to the higher than modelled fair value mark accretion of the acquired fixed rate portfolio. As such, we
accounted for the U.S. Treasuries and other instruments at amortized cost, with interest recorded in net interest income on an accrual basis.

 The amortized cost classification resulted in no accounting recognition of unrealized losses on the U.S
Treasuries and other instruments due to rising rates, preserving the fair value benefit in retained earnings of the interest rates swaps entered into for purposes of economically offsetting changes in goodwill between the signing date and the
closing date of the BOTW acquisition. Hedge Accounting
 After the closing date, we applied IAS 39 hedge accounting requirements to the new at-market interest rate swaps and
the U.S. Treasuries and other instruments that are designated in fair value hedging relationships. From the date of designation, the carrying value of the U.S treasuries and other instruments would be adjusted for the change in fair value caused by
interest rate risk. [ IAS 39.89 ] Since any fair value adjustments post hedge designation would be reflected in their carrying value, we, in effect, locked in the economic unrealized fair value loss on the U.S. treasury and other instruments
attributable to the rising interest rate between when they were purchased and the designation date. This $5.7 billion loss would then naturally accrete over time through net interest income through the effective interest rate calculation
[ IFRS 9.5.4.2 ] and provide an accounting offset to the additional purchase accounting accretion in net interest income arising from the acquired fixed rate portfolio.

 b)
 Quantify the related
 mark-to-market gains recognized in net interest income and non-interest revenue for the quarterly and annual periods ended
between December 20, 2021 and February 1, 2023. A summary of
the cumulative net $5.7 billion gain recorded in net interest income and non-interest revenue between announcement and close is shown below:

 Quarter/
 $ millions (pre-tax)

 Net interest income from portfolio of U.S. Treasuries and other instruments

 Non-Interest Revenue from
mark-to-market on interest rate swaps

 Q1 2022

 45

 517

 Q2 2022

 122

 3,433

 Q3 2022

 38

 (983
 )

 Q4 2022

 (157
 )

 4,698

 Q1 2023

 (383
 )

 (1,628
 )

 Total

 (335
 )

 6,037

 c)
 Tell us what you mean by “the interest rate swaps were neutralized” at the time of close and
“(t)he fair value hedges, coupled with other actions taken to manage our interest rate risk profile to its target position, crystallized a $5.7 billion loss on these instruments.”
 After the closing date, we closed the original interest rate swaps entered into at the signing date. This resulted in a cumulative gain totaling
$5.7 billion, which had flowed through income/retained earnings between the signing date and the acquisition date to offset the increase in goodwill.
 Closing out the original interest rate swaps led to an on-balance sheet interest rate risk mismatch because the U.S.
Treasuries and other instruments had been acquired to offset the on-balance sheet interest rate risk exposure from the interest rate swaps that we closed out. As a result, we entered into new at-market interest rate swaps that we designated as fair value accounting hedges of the U.S. Treasuries and other instruments, in effect crystallizing the $5.7 billion unrealized loss these assets accumulated
between signing date and the closing date.

 d)
 Tell us how you accounted for the related U.S. Treasuries and other instruments prior to and after the
close of the acquisition. The U.S. Treasuries and other instruments purchased were accounted for at amortized cost under IFRS
9, with interest recorded in net interest income, as our business model to manage these instruments has not changed. Accounting for these instruments did
not change after close of the acquisition, but we designated them as the hedged item in IAS 39 fair value hedge relationships to limit any further interest rate risk exposure.

 e)
 Clarify in more detail the amounts and related durations of the U.S. Treasuries and other instruments
purchased upon the announcement of the acquisition. We acquired approximately US$38 billion ($47 billion) of U.S.
Treasuries (and, to a much lower extent, other fixed rate instruments), with a weighted average life of approximately 7 years, shortly after the announcement of the acquisition. The individual U.S. Treasuries had an initial term of 2-30 years, mirroring the expected remaining term-to-maturity profile of the acquired fixed rate portfolio that would be subject to
fair value accounting at the acquisition date. Prior to acquisition close, the U.S Treasuries and other instruments portfolio totaled approximately US$40 billion ($53 billion) with a weighted average life of approximately 6 years.

 f)
 Describe how you assessed the hedge effectiveness of the new interest rate swaps, quantify the gains
(losses) on these swaps used to calculate hedge ineffectiveness for years ended October 31, 2023 and 2024, and tell us the remaining term to maturity of these swaps.
 On February 1, 2023, we designated US$40 billion ($53 billion) of at-market interest rate swaps as hedges of
the U.S. Treasuries and other instruments (hedged items) in the Bank’s IAS 39 fair value hedge program. From the date of designation, the carrying value of the U.S Treasuries and other instruments was adjusted for the change in fair value
caused by interest rate risk. To the extent that the change in the fair value of the interest rate swaps does not offset changes in the fair value of the U.S Treasuries and other instruments for the hedged interest rate risk, the net amount (hedge
ineffectiveness) is recorded in Non-interest Revenue, Other revenues (losses), in our Consolidated Statement of Income.
 The main sources of ineffectiveness are our own credit risk on the fair value of the interest rate swaps, and differences in terms such as fixed interest rate
or reset/settlement frequency between the interest rate swaps and the U.S. Treasuries and other instruments. We evaluate hedge effectiveness at the
inception of any hedging relationship and on a quarterly basis, retrospectively and prospect