Further extends CIBC's wealth management business and North
American platform
TORONTO, July 10, 2017 /PRNewswire/ - CIBC (TSX:
CM) (NYSE: CM) announced today that it has entered into a
definitive agreement to acquire Geneva Advisors, a private wealth
management firm, headquartered in Chicago. This complementary acquisition will
enhance CIBC's presence in the region, and builds on the bank's
ability to deepen client relationships in the U.S. following the
recent acquisition of The PrivateBank. On closing, the Geneva
Advisors business will become part of CIBC Atlantic Trust Private
Wealth Management.
Geneva Advisors is an independent private wealth management firm
focused on high net worth clients. The firm has US$8.4 billion in assets under management and
approximately 100 employees. The transaction follows the
completion of CIBC's recent acquisition of The PrivateBank in June,
and will expand the bank's private wealth management client-base
and investment management capabilities in the U.S.
"Acquiring Geneva Advisors will further strengthen CIBC Atlantic
Trust Private Wealth Management, led by our CEO of this business
and industry veteran Jack
Markwalter," said Larry
Richman, Group Head, U.S. Region, and President & CEO
The PrivateBank. "This investment will add scale in key
markets where we can offer clients differentiated, high-touch
service. We are pleased to have reached an agreement and look
forward to welcoming Geneva Advisors' clients and strong team to
our bank."
"Bringing together these two companies is a win for our
clients," said John Huber, Principal
& Portfolio Manager, Geneva
Advisors. "From our founding in 2003 to today, our focus has
been to offer objective and unbiased investment management
decisions. We are proud of this philosophy and our tremendous team
that has consistently grown Geneva Advisors and provided
exceptional value to our clients."
"CIBC shares our client-focused culture and team-based
approach," said Bob Bridges,
Principal & Portfolio Manager, Geneva
Advisors. "We have a common belief that by putting our
clients' needs first, we are able to build trusted and long-lasting
relationships. We look forward to becoming part of the CIBC
team and enhancing the value we offer to our clients."
Under the terms of the agreement, CIBC will acquire Geneva
Advisors for up to US$200 million, of
which US$135 million will be paid at
closing and US$65 million is
contingent on future performance conditions being met. The total
purchase price including contingent consideration will be paid 25%
in cash and 75% in the form of CIBC common shares. The transaction
is expected to close in the fourth quarter of fiscal 2017, subject
to the satisfaction of customary closing conditions, including
receipt of regulatory approvals. The deal is expected to
reduce CIBC's Common Equity Tier 1 Capital Ratio by approximately 6
basis points at closing and become accretive to CIBC's earnings per
share in fiscal 2019. Upon completion of the
transaction, CIBC will have approximately US$50 billion in assets under administration in
the U.S. on a pro forma basis.
About CIBC
CIBC is a leading Canadian-based global financial institution
with 11 million personal banking, business, public sector and
institutional clients. Across Personal and Small Business Banking,
Commercial Banking and Wealth Management, and Capital Markets
businesses, CIBC offers a full range of advice, solutions and
services through its leading digital banking network, and locations
across Canada, in the United States and around the
world. Ongoing news releases and more information about CIBC can be
found at www.cibc.com/ca/media-centre/.
Forward-looking Statements
Certain statements contained in this communication may be deemed
to be forward-looking statements under certain securities laws. All
such statements are made pursuant to the "safe harbor" provisions
of, and are intended to be forward-looking statements under
applicable Canadian and U.S. securities legislation, including the
United States Private Securities Litigation Reform Act of
1995. These statements include, but are not limited to, any
statements about the expected effects of the acquisition Geneva
Advisors by CIBC including any expected impact on CIBC's earnings,
Common Equity Tier 1 ratio or other statements other than in
relation to historical facts, statements about the operations,
business lines, financial condition, risk management, priorities,
targets, ongoing objectives, strategies of Geneva Advisors and CIBC
and the regulatory environment in which they operate and outlook
for calendar year 2017 and subsequent periods. Forward-looking
statements are typically identified by the words "believe",
"expect", "anticipate", "intend", "estimate", "forecast", "target",
"objective" and other similar expressions or future or conditional
verbs such as "will", "should", "would" and "could". By their
nature, these statements require us to make assumptions, including
the economic assumptions set out in the "Financial performance
overview – Outlook for calendar year 2017" section of our 2016
Annual Report, as updated by quarterly reports, and are subject to
inherent risks and uncertainties that may be general or specific. A
variety of factors, many of which are beyond our control, affect
our operations, performance and results, and could cause actual
results to differ materially from the expectations expressed in any
of our forward-looking statements. These factors include:
credit, market, liquidity, strategic, insurance, operational,
reputation and legal, regulatory and environmental risk; the
effectiveness and adequacy of our risk management and valuation
models and processes; legislative or regulatory developments in the
jurisdictions where we operate, including the Dodd-Frank Wall
Street Reform and Consumer Protection Act and the regulations
issued and to be issued thereunder, the Organisation for Economic
Co-operation and Development Common Reporting Standard, and
regulatory reforms in the United
Kingdom and Europe, the
Basel Committee on Banking Supervision's global standards for
capital and liquidity reform and those relating to bank
recapitalization legislation and the payments system in
Canada; amendments to, and
interpretations of, risk-based capital guidelines and reporting
instructions, and interest rate and liquidity regulatory guidance;
the resolution of legal and regulatory proceedings and related
matters; the effect of changes to accounting standards, rules and
interpretations; changes in our estimates of reserves and
allowances; changes in tax laws; changes to our credit ratings;
political conditions and developments, including changes relating
to economic or trade matters; the possible effect on our business
of international conflicts and the war on terror; natural
disasters, public health emergencies, disruptions to public
infrastructure and other catastrophic events; reliance on third
parties to provide components of our business infrastructure;
potential disruptions to our information technology systems and
services; increasing cyber security risks which may include theft
of assets, unauthorized access to sensitive information, or
operational disruption; social media risk; losses incurred as a
result of internal or external fraud; anti-money laundering; the
accuracy and completeness of information provided to us concerning
clients and counterparties; the failure of third parties to comply
with their obligations to us and our affiliates or associates;
intensifying competition from established competitors and new
entrants in the financial services industry including through
internet and mobile banking; technological change; global capital
market activity; changes in monetary and economic policy; currency
value and interest rate fluctuations, including as a result of
market and oil price volatility; general business and economic
conditions worldwide, as well as in Canada, the U.S. and other countries where we
and CIBC have operations, including increasing Canadian household
debt levels and global credit risks; our success in developing and
introducing new products and services, expanding existing
distribution channels, developing new distribution channels and
realizing increased revenue from these channels; changes in client
spending and saving habits; our ability to attract and retain key
employees and executives; our ability to successfully execute our
strategies and complete and integrate acquisitions and joint
ventures; the risk that expected synergies and benefits of the
acquisition of Geneva Advisors by CIBC will not be realized within
the expected time frame or at all; and our ability to anticipate
and manage the risks associated with these factors. This list
is not exhaustive of the factors that may affect any of our
forward-looking statements. These and other factors should be
considered carefully and readers should not place undue reliance on
our forward-looking statements. Additional information about these
factors can be found in the "Management of risk" section starting
on page 40 of our 2016 Annual Report. Any forward-looking
statements contained in this communication represent the views of
management only as of the date hereof and are presented for the
purpose of assisting our stockholders and financial analysts in
understanding our financial position, objectives and priorities and
anticipated financial performance as at and for the periods ended
on the dates presented, and may not be appropriate for other
purposes. We do not undertake to update any forward-looking
statement that is contained in this communication or in other
communications except as required by law.
SOURCE CIBC - Corporate