Bank of Montreal announced on Friday that it has increased its provision for the fourth quarter ending October 31.

The bank will increase its provision for credit losses by approximately $430 million for its fourth quarter, bringing the estimated total fourth quarter provision for credit losses to $546 million. The total provision for credit losses for 2001 is estimated to be $880 million, excluding non- recurring items, compared with $400 million in fiscal 2000

The bank cited the continuing deterioration of the U.S economy and the more recent weakening of the Canadian economy.

BMO also said it expects to write down approximately $250 million for impairment in value of certain of its other assets as a result of the on-going deterioration in the economic environment. Approximately $200 million of the write-down relates to the bank’s equity investments in its own collateralized bond obligations and a corporate loan securitization receivable.

The increased provisions and write-downs, which include those announced by Harris Bank today, will result in a total after-tax reduction to net income of approximately $410 million in the fourth quarter of 2001.

The bank will release results for its fourth quarter and for its 2001 fiscal year on November 27, 2001.