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CIBC Announces Third Quarter 2014 Results(Canada Newswire Via Acquire Media NewsEdge) TORONTO, Aug. 28, 2014 /CNW/ - CIBC (TSX: CM) (NYSE: CM) today announced its financial results for the third quarter ended July 31, 2014. Third quarter highlights Reported net income was $921 million, compared with $878 million for the third quarter a year ago, and $306 million for the prior quarter. Adjusted net income(1) was $908 million, compared with $931 million for the third quarter a year ago, and $887 million for the prior quarter. Reported diluted earnings per share (EPS) was $2.26, compared with $2.13 for the third quarter a year ago, and $0.73 for the prior quarter. Adjusted diluted EPS(1) was $2.23, compared with $2.26 for the third quarter a year ago, and $2.17 for the prior quarter. Reported return on common shareholders' equity (ROE) was 21.0% and adjusted ROE(1) was 20.7%. Results for the third quarter of 2014 were affected by the following items of note aggregating to a positive impact of $0.03 per share: $52 million ($30 million after-tax, or $0.08 per share) gain within an equity-accounted investment in our merchant banking portfolio; $9 million ($7 million after-tax, or $0.02 per share) expenses relating to the development of our enhanced travel rewards program and in respect of the Aeroplan transactions with Aimia Canada Inc. (Aimia) and The Toronto-Dominion Bank (TD); $9 million ($8 million after-tax, or $0.02 per share) amortization of intangible assets; and $2 million ($2 million after-tax, or $0.01 per share) loss from the structured credit run-off business. CIBC's Basel III Common Equity Tier 1 ratio at July 31, 2014 was 10.1%, and our Tier 1 and Total capital ratios were 12.2% and 14.8%, respectively, on an all-in basis compared with Basel III Common Equity Tier 1 ratio of 10.0%, Tier 1 capital ratio of 12.1% and Total capital ratio of 14.9% in the prior quarter. CIBC announced today the intention to seek Toronto Stock Exchange approval for a normal course issuer bid that would permit us to purchase for cancellation up to a maximum of 8 million, or approximately 2% of our outstanding common shares, over the next 12 months. "CIBC's solid results this quarter reflect the strength of our retail and wholesale banking franchises and strong wealth management platform," says Gerald T. McCaughey, CIBC President and Chief Executive Officer. "As we strive to be the leading bank for our clients, our clear focus on client service coupled with our strategic growth initiatives underpins our ability to deliver consistent and sustainable earnings." Core business performance Retail and Business Banking reported net income of $589 million for the third quarter, down $23 million or 4% from the third quarter a year ago. Adjusting for the items of note shown above, adjusted net income(1) was $597million, down $31 million or 5% from the third quarter a year ago. Core operating results were strong including solid volume growth across key products and lower loan losses, which were offset by lower cards revenue due to the sale of the Aeroplan portfolio. Ongoing investment in innovations and strategic initiatives continue to support deeper client relationships. During the third quarter of 2014, Retail and Business Banking continued to make progress against our objectives of accelerating profitable revenue growth and enhancing the client experience: We launched the new CIBC Tim Hortons Double Double Visa Card in partnership with Tim Hortons, leveraging a first-of-its-kind two-button technology that combines a CIBC Visa credit card with a Tim Hortons rewards card; More than one million cheques were deposited using our eDeposit™ feature available on our mobile banking app since it was launched, giving clients the flexibility to deposit cheques to their CIBC accounts by taking a picture of the cheque with their mobile device - a first among the major Canadian banks; and We were awarded "Best Consumer Internet Bank - Canada" and "Best Integrated Consumer Bank Site - North America" by Global Finance Magazine. Wealth Management reported net income of $121 million for the third quarter, up $19 million or 19% from the third quarter a year ago. Revenue of $568 million was up $110 million or 24% compared with the third quarter of 2013. This was primarily due to higher client assets under management driven by market appreciation and net sales of long-term mutual funds, higher fee-based and commission revenue, and the acquisition of Atlantic Trust. During the third quarter of 2014, Wealth Management continued its progress in support of our strategic priority to build our wealth management platform: CIBC Asset Management achieved $100 billion in assets under management - a significant milestone along with its 22nd consecutive quarter of positive net sales of long-term mutual funds which hit $4.5 billion year to date; Client satisfaction, a key focus and a foundation of our growth strategy, continues to strengthen at CIBC Wood Gundy and is among the industry's leaders with an 11% increase over the past six years; and Atlantic Trust was recently ranked the second-highest luxury brand among wealth management firms in the U.S. in the 2014 Luxury Brand Status Index™ (LBSI) wealth management survey. Wholesale Banking reported net income of $282 million for the third quarter, up $69 million or 32% from the prior quarter. Excluding items of note, adjusted net income(1) was $254 million, up $26 million or 11% from the prior quarter. As a leading wholesale bank in Canada and active in core Canadian industries in the rest of the world, Wholesale Banking acted as: Joint bookrunner in a new $3.5 billion revolving credit facility and joint lead agent and joint bookrunner for $1 billion of senior secured bonds for North West Redwater Partnership; Joint bookrunner on PrairieSky Royalty's $1.7 billion initial public offering of common shares; and Financial advisor to Merit Energy Company on the sale of its oil producing properties in Wyoming to Memorial Production Partners for $915 million and the sale of its properties in Colorado to Atlas Resource Partners for $420 million. "In summary, CIBC delivered strong performance during the third quarter," says Mr. McCaughey. "We are on track in executing our growth strategy to be the leading bank for our clients and we are well positioned for future growth." Making a difference in our Communities CIBC is committed to supporting causes that matter to our clients, our employees and our communities. During the quarter we: Helped raise $3.2 million in support of children with cancer and their families through our sponsorship of the Tour CIBC Charles Bruneau and the CIBC 401 Bike Challenge; Committed $1 million to KidSport, a national program that helps give kids greater access to organized sport, to mark the one year countdown to the TORONTO 2015 Pan Am Games; and As the Official Canadian Bank and CBC broadcast sponsor of the FIFA World Cup™, celebrated Canadians' passion for the beautiful game with a 12-stop cross country CIBC Soccer Nation tour. (1) For additional information, see the "Non-GAAP measures" section. |