CIBC's Profit Jumps 20%, and It Increases Dividend
December 01 2016 - 7:42AM
Dow Jones News
By Judy McKinnon
Canadian Imperial Bank of Commerce on Thursday raised its
dividend and posted a nearly 20% increase in fiscal-fourth quarter
earnings, besting analyst expectations on improved results across
its key operations.
Canada's fifth-largest lender by assets, which earlier this year
agreed to buy Chicago-based PrivateBancorp Inc . for about $3.8
billion in cash and stock, reported revenue and earnings
improvements in each of its retail and business banking,
wealth-management and capital-markets divisions in the quarter
ended Oct. 31.
Toronto-based CIBC said it earned 931 million Canadian dollars
($693 million), or C$2.32 a share in its latest quarter. That's
ahead of the C$778 million, or C$1.93 a share, it earned a year
earlier.
The bank said results in its latest quarter included items that
reduced earnings by 28 Canadian cents overall, the largest being a
25-Canadian-cent-a-share restructuring charge related to employee
severance.
Adjusted to exclude items, CIBC said it earned C$2.60 a share,
easily beating the C$2.48 a share analysts were expecting,
according to Thomson Reuters.
Revenue rose almost 6% to C$3.68 billion.
Loan-loss provisions, or the funds set aside to cover soured
loans, increased to C$222 million from C$198 million a year
earlier, but were down from C$243 million in the previous
quarter.
In the latest period, earnings from retail and business banking
rose 2%, while wealth management and capital markets earnings were
up 3% and 52%, respectively. The bank noted that loan-loss
provisions in its capital-markets division were nil in the quarter,
compared with C$22 million a year earlier, largely due to lower
losses in the oil and gas sector.
CIBC raised its quarterly payout by 3 Canadian cents a share, to
C$1.24 a share.
In June, CIBC agreed to buy Chicago-based PrivateBancorp Inc. in
what would be its biggest purchase to date. The bank has said it
expects to close the deal early next year.
Separately on Thursday, PrivateBancorp said two independent
proxy advisory firms are recommending shareholders vote in favor of
the CIBC offer. A special meeting of PrivateBancorp shareholders is
scheduled for Dec. 8, it noted.
Write to Judy McKinnon at judy.mckinnon@wsj.com
(END) Dow Jones Newswires
December 01, 2016 07:27 ET (12:27 GMT)
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