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## Acquired Businesses 

BMO Financial Group has selectively acquired a number of businesses over the past two years in advancing its transnational growth strategy. These acquisitions have had minimal net effect on net income to date, largely due to non-cash amortization expenses and the difficult market environment for wealth man- agement businesses. The acquisitions have increased revenues and expenses. The accompanying table outlines the acquisitions and their additive effect on revenue, expense and net income by operating group for 2002 to assist in analyzing results. 

## Revenue Growth 

Total revenue declined $4 million in 2002 to $8,859 million. 

Excluding non-recurring items that had the effect of increasing the previous year’s results, revenue rose $151 million or 2%. 

After adjusting 2002 revenue for the additive effect of revenues of businesses acquired in 2001 and 2002, revenue declined $102 million or 1%. Solid revenue growth in Personal and Com- mercial Client Group was more than offset by reductions in Investment Banking Group. Private Client Group revenue, which rose 13% overall, was relatively unchanged after adjusting for acquired businesses, in a very challenging environment. Cor- porate Support revenue rose, excluding non-recurring items, due to higher securitization revenue. 

<img src='content_image/43921.jpg'>

<img src='content_image/43922.jpg'>

## Business Acquisitions 

<img src='content_image/43919.jpg'>

Above amounts exclude $62 million ($39 million after tax) of non-recurring acquisition-related costs of Private Client Group. 

## Taxable Equivalent Basis (teb) 

Revenues reflected in our MD&A are presented on a taxable equivalent basis (teb). The teb basis increases revenues from certain tax-exempt securities to the equivalent amount of revenue that would attract tax, to facilitate comparisons. The effect is disclosed in Table 6 on page 54. 

## Revenue 

(excluding non-recurring items) ($ millions) 

<img src='content_image/43920.jpg'>

<img src='content_image/43923.jpg'>

($ millions) 

<img src='content_image/43924.jpg'>

