Bank of Montreal (BMO) foresees no significant integration issues arising from its $16.3 billion acquisition of Bank of the West announced Monday since the banks’ core platforms and suppliers are strikingly similar.

IT also plays a key role in synergies that BMO contends will help to recoup the cost of the deal, with 30% coming from IT efficiencies, BMO Chief Executive officer Darryl White said during a call with investors Monday. The remaining savings are expected to come from centralized overhead and shared services at 55% and “other” at 15%.

“There is a significant vendor overlap between the two firms and technology, including our branch and core retail and core commercial banking platforms and ATM systems,” White said. “Similarly, both banks utilize the same vendors in corporate areas in our core infrastructure. Common platforms speak to both confidence in our expense energies and the low level of integration.”

The two banks have several technology platforms in common, including a core provider — both run products from FIS, with San Francisco-based Bank of the West using FIS Systematics and BMO’s U.S. subsidiary BMO Harris running FIS Modern Banking Platform, according to analytics company FI Navigator.

Both banks run solutions from Finastra for consumer loan originations, though Bank of the West uses Accenture’s Mortgage Cadence for its mortgage origination system while BMO Harris uses Finastra’s Fusion Mortgagebot. In addition, both leverage FIS TrustDesk for their wealth management platform, FI Navigator reported.

The banks also share a digital-first approach to banking with “thin” branches, White noted.

During the investors call, BMO’s management outlined the benefits of acquiring Bank of the West, which is the U.S. presence of French lender BNP Paribas. BMO will expand its footprint in the United States, particularly in the lucrative California market, which White noted has a gross domestic product almost twice that of Canada.

Bank of the West reported $96.1 billion in total assets in its 2020 annual report, but BMO noted the bank is now worth north of $100 billion. The $773.7 billion BMO will fund the transaction primarily with excess capital and anticipated capital generation, the bank said in a release.

In the past 10 years, the U.S. contribution to BMO’s earnings has grown from 15% to 36%, and it’s expected to increase to 44% on a pro forma basis, White said.

“We’ve invested along the way in leading digital capabilities, innovative products and exceptional talent, a platform that has been deliberately built for more scale,” White said. “We intend to apply our proven strength in profitably growing businesses to Bank of the West’s impressive foundation in order to accelerate growth and returns.”

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