The Canadian Commercial and Wealth Management arm of CIBC has been able to withstand the Covid-19-induced turbulence, demonstrating a strong performance in Q4 2020.
Gains in this unit, supported by the capital markets division, helped temper a lackluster quarter for the overall group that was hit by a slowdown at its US commercial banking and wealth management arm.
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Highlights
The Canadian Commercial and Wealth Management arm of CIBC reported a net income of C$340m ($264.6m), a rise of 11%.
The unit’s total revenue increased to C$515m from C$502m over the period.
CIBC attributed the growth to higher loan and deposit volumes and strong growth in asset management fees.
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By GlobalDataProvision for credit losses of C$82m was up C$65m from the fourth quarter of 2019.
Non-interest expenses of C$270m were C$16m lower than the prior year because of lower business development and employee-related compensation, the bank said.
In the capital markets arm, net income soared to C$267m from C$230m.
Total revenue at the unit rose 7% year-on-year to C$792m, with global markets accounting for 470m and corporate and investment banking making up the rest.
Group Results
At a group level, CIBC’s net income fell 14% year-on-year to C$1.02bn.
However, it lowered its loan loss provisions to C$291m in Q4, down from C$402m in the previous year and C$525m in the previous quarter.
The lender reported adjusted diluted earnings per share of C$2.79 for each share, surpassing estimates, compared to C$2.84 a year earlier.
Comment:
CIBC president and CEO Victor Dodig said: “We delivered resilient financial performance in fiscal 2020 against the backdrop of a global pandemic and an evolving geopolitical environment. Throughout this period, our team was guided by our purpose as we responded, ensuring that we supported our clients, team members and communities through a uniquely challenging time.
“At the same time, we took steps to position our bank for the future, including making strategic investments in our people, processes and platforms, and taking steps to enhance our efficiency. As we enter fiscal 2021, our strong financial position will enable us to continue executing our client-focused strategy to deliver growth and generate value for all our stakeholders.”
