2007 Market Pullback in Perspective Insight & 2007 Market Pullback in Perspective S&P / TSX Index drops by over 10% from its high By week-ended August 17, the S&P/TSX Composite Index was down 10.9% from its high point (July 19) signaling a market correction (a 10% decline from a peak) had occurred. Concerns over the global credit crunch, initiated by problems in the U.S. subprime market, have resulted in some uneasiness, despite reassurance and support from central banks. It’s important to realize that market corrections are normal and often temporary. Discipline is key. Keeping emotions out of the markets and sticking to an investment plan is the cornerstone of prudent and successful investing. S&P / TSX Composite Index (1-year period as at August 17, 2007) World Markets (as at Aug.17-07) +21.5% Market pullback (%) since most recent high point of Index (price Index returns, local currency) 14,647* (Jul 19-07) (from Aug 17-06 to Jul 19-07) -10.9% S&P/TSX Dow -10.9% -7.4% (from Jul 19-07 to Aug 17-07) NASDAQ FTSE 100 -8.1% -10.2% Subprime and global credit concerns escalate 13,050 (Aug 17-07) 12,056 (Aug 17-06) DAX NIKKEI 225 -9.5% -16.5% *Note: intraday high. Source: Bloomberg, as at August 17, 2007 (price index returns) Source: Bloomberg, as at August 17, 2007 Insight & Perspective The current equity market pullback is the sixth with a decline of at least a 5% since the bull market began in late 2002. A key feature of many crisis periods is the strength of the market coming out the other side. Please see the reverse for more insight and perspective on periods of “crisis and recovery”.

Perspective Insight & Crisis periods and market recovery Over the years, equity markets have persevered through many crisis periods, and have not only recovered, but gone on to reach new highs. This chart presents several crisis periods and compares the initial loss/gain at the time of the crisis with the corresponding loss/gain over the following 1, 3 and 6 months after the crisis. The strength of many of the subsequent recovery periods may surprise you. Source: BMO Mutual Funds After Each Crisis . . . Recovery S&P 500 Index (Black Monday) Loss/gain during crisis 1 month later 3 months later 6 months later ® Registered trade-mark of Bank of Montreal, used under licence. BMO Mutual Funds are offered by BMO Investments Inc., a financial services firm and a separate legal entity from Bank of Montreal. Past performance of indices used in examples does not indicate future results. August 2007