BAM Bam Groep (Kon)

RNS No 4844r
BANK OF MONTREAL
4th September 1997

New Credit Card Company to be Formed by Bank of Montreal/Harris
Bank, BankBoston and First Annapolis

Chicago/Boston/Baltimore, September 4, 1997 - A new credit card company that
will combine the strengths and expertise of industry leaders with quality credit
card portfolios was announced today by Bank of Montreal (BMO) and its U.S.
subsidiary, Chicago-based Harris Bank, BankBoston and First Annapolis. The three
institutions plan to form a new U.S. credit card company, subject to regulatory
approval. A name for the new company will be announced at a later date.

"We are creating a formidable new credit card company," said John R. Soderlund,
who will serve as president and chief executive officer of the company. Mr.
Soderlund currently is Managing Director of First Annapolis and has been most
recently responsible for helping to build BankBoston's national credit card
business. "This will be a ground-breaking company that will capitalize on the
opportunities and restructuring taking place in the credit card industry."

Mr. Soderlund noted that according to First Annapolis research, the credit card
business is undergoing major structural change that is driving significant
consolidation. Large, aggressive, focused credit card companies are increasing
their market share and will control the market over the next five years.

The alliance between Bank of Montreal/Harris, BankBoston and First Annapolis
will allow our new company to compete in a marketplace where only those players
who are industry focused and sophisticated will prosper,' Mr. Soderlund said.

"In a consolidating industry, the winning issuers will have the economies of
scale to handle rising direct servicing costs, economies of skill in using
sophisticated information management techniques, and the innovative marketing
needed to position their credit cards uniquely in the eyes of consumers," Mr.
Soderlund continued. "Our new company will bring all of these qualities and
skills together."

The company intends to be a top 15 credit card company by the year 2000 by
growing through both traditional channels and forging creative alliances with
other banks. These alliances will be designed to help banks stay in the credit
card business in a meaningful way while leveraging the new company's
capabilities.

The new company will use First Data Resources, a leading global provider of
issuer-based services, for data processing, customer service, credit and
collections support. Most Harris credit card issuing employees will become
employees of First Data Resources.

As part of the new company's formation, Bank of Montreal/Harris Bank will
contribute Harris' consumer card portfolio, made up of 500,000 customers, and
$750 million in receivables to the new company. Bank of Montreal is also
investing $115 million in cash. In exchange, Bank of Montreal will have a 69
percent ownership of the company. Credit cards under the Harris name will
continue to be offered by the new company to Harris customers.

BankBoston will contribute its national credit card portfolio, made up of about
550,000 customers, and approximately $1.2 billion in receivables for cash and
will receive 19 percent of company ownership. Credit cards under the BankBoston
name will continue to be offered and serviced through the new company.

Together the banks will bring the new company quality portfolios, marquee names,
international footprints and capital strength.

First Annapolis, a leading U.S. consulting firm specializing in credit cards and
other retail financial services, will contribute to the new company First
Annapolis Marketing Information Services, Inc. (FAMIS), a comprehensive credit
card portfolio management company which brings specialized skills and innovative
marketing to the new company. FAMIS, under the direction of Mr. Soderlund, has
established a reputation for sophisticated data mining and analytic
capabilities. First Annapolis will have a 12 percent ownership.

Executives from each of the partnering companies made the following comments
about the alliance:

Jeffrey S. Chisholm, Vice Chair, Bank of Montreal, Electronic Financial Services
(which includes the credit card operations of Bank of Montreal and Harris Bank);
"This new company will secure the strategic footing for Bank of Montreal and
Harris Bank to compete in the critical U.S. card issuing industry. The new
company will bring together three institutions with unique strengths and
experience. Bank of Montreal has worked closely with First Annapolis during the
past two years, benefiting from their expertise, and we look forward to new
successes with BankBoston. We are committed to becoming a leader in this
business so we can continue to offer our personal and small business customers
enhanced quality credit card products and services throughout North America."

Chad Gifford, Chief Executive Officer, BankBoston: "We look forward to a
successful venture with Bank of Montreal, and John Soderlund and his management
team as they work to become a leader in the credit card industry. Over the past
two years, we have entered into two other joint ventures where it was clear that
scale and industry-specific expertise and focus would be necessary for long-term
success - as is the case in the credit card industry. Both of those ventures are
recognized as major players in their markets and each investment has clearly
increased value for our shareholders. We believe this will do the same. This
transaction successfully completes the strategic review of BankBoston's national
consumer businesses."

Frederick A. White, President and Co-Founder, First Annapolis: "First Annapolis
Marketing Information Services was founded to help banks compete in the credit
card business by providing access to economies of scale and skill, and
innovative marketing techniques. This new venture represents an extension of
that strategy. We believe that partnerships like this company represent the
future of retail financial services."

Bank of Montreal (NYSE:BM0) is the only bank with a retail and commercial
presence in all three NAFTA countries. With assets of approximately US$147
billion, it is one of the 10 largest financial institutions in North America.
The Bank of Montreal group of companies includes Chicago-based Harris Bank, a
major financial institution in the Midwest, and Nesbitt Burns, one of Canada's
largest full-service investment firms, which is rapidly expanding its presence
in the U.S. Bank of Montreal also holds a 16 percent equity and 20 percent
voting stake in Bancomer, a leading Mexican financial institution.

Harris Bank, with $22 billion in assets, is one of the largest community bank
networks in Illinois, a nationally recognized provider of personal trust and
private banking services, and a major Midwest corporate bank.

BankBoston (NYSE:BKB), with assets of $66.1 billion as of June 30,1997, was
founded in 1784 and is the 15th largest bank holding company in the United
States. BankBoston is engaged in: consumer banking in southern New England;
financing to selected corporations regionally, nationally and internationally;
and full-service banking in key Latin American markets. The corporation and its
subsidiaries operate through a network of offices in the United States and
through more than 100 offices in 23 countries in Latin America, Europe and
Asia, the third-largest network of any U.S. bank. The corporation's common and
preferred stocks are listed on the New York and Boston stock exchanges.

First Annapolis offers a family of specialized services - consulting and
investment banking - to the financial services industry. The firm's major
practice areas include credit, commercial and private label card issuance,
merchant card processing, electronic banking, and mortgage origination and
servicing. First Annapolis offers a variety of services including strategic and
business planning, financial diagnostics, marketing strategy and research, risk
analysis, vendor selection and negotiation, operations redesign, and general
management advisory services. The company also offers merger and acquisition
advisory services, business/formation, business valuation and transaction
review, and due diligence support.


Contacts:
Pam Kassner, Bank of Montreal/Harris Bank, (312) 461-6625
Joe Barbera, Bank of Montreal (Toronto), (416) 927-2740
Karen Schwartzman, BankBoston, (617) 434-7594
Frances Bakewell, First Annapolis, (410) 855-8526


END

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