Canadian Imperial Bank Of Commerce · TSX:CM
Canadian Imperial Bank Of Commerce — CIBC — Q2 2017 Earnings Presentation
30 slides from Canadian Imperial Bank Of Commerce's earnings presentation, May 25, 2017
Slide 1: CIBC Investor Presentation Second Quarter, 2017
CIBC Investor Presentation Second Quarter, 2017 May 25th, 2017
Slide 2: Forward-Looking Statements
2 Forward-Looking Statements A NOTE ABOUT FORWARD-LOOKING STATEMENTS: From time to time, we make written or oral forward-looking statements within the meaning of certain securities laws, including in this report, in other filings with Canadian securities regulators or the SEC and in other communicat
Slide 3: CIBC Overview
CIBC Overview Victor Dodig President and Chief Executive Officer
Slide 4: Second Quarter, 2017 Financial Review
Second Quarter, 2017 Financial Review Kevin Glass Senior Executive Vice-President and Chief Financial Officer
Slide 5: Second Quarter, 2017 Summary
5 Second Quarter, 2017 Summary Q2/16 Q1/17 Q2/17 • Reported and Adjusted(2) EPS growth Net Income ($MM) - Reported (1) 941 1,407 1,050 of 10% YoY (2) Net Income ($MM) - Adjusted 962 1,166 1,070 Diluted EPS - Reported $2.35 $3.50 $2.59 • Earnings growth in all businesses (2) Diluted EPS - Adjusted $2
Slide 6: Acquisition of PrivateBancorp
6 Acquisition of PrivateBancorp • Stockholder approval received on May 12; transaction expected to close in June • CET1 ratio expected to remain above 10% upon closing • Acquisition expected to be fully accretive in Year 3 • Estimated total transaction and integration costs of US$130MM - US$150MM PV
Slide 7: Retail & Business Banking
7 Retail & Business Banking Adjusted ($MM) (1) Q2/16 Q1/17 Q2/17 • Strong and broad-based volume growth Personal Banking 1,713 1,836 1,771 − Mortgages up 12% Business Banking 423 453 447 Other 14 8 7 − Business lending up 11% Revenue 2,150 2,297 2,225 − Business deposits up 11% Provision for Credit
Slide 8: Wealth Management
8 Wealth Management Adjusted ($MM) (1) Q2/16 Q1/17 Q2/17 • Higher fee-based client asset growth Retail Brokerage 312 352 352 in Retail Brokerage Asset Management 179 194 207 Private Wealth Management 91 107 100 Other 1 - - • Strong AUM growth in Asset Revenue 583 653 659 Management and Private Wealt
Slide 9: Capital Markets
9 Capital Markets Adjusted ($MM) (1) Q2/16 Q1/17 Q2/17 • Revenue down 3% YoY Global Markets 469 531 407 − Lower trading revenue Corporate & Investment Banking 296 335 326 Other (9) 11 0 − Lower underwriting activity Revenue (2) 756 877 733 − Higher investment portfolio gains Provision for (reversal
Slide 10: Corporate & Other
10 Corporate & Other Adjusted ($MM) (1) Q2/16 Q1/17 Q2/17 • Revenue stable YoY International Banking 175 179 178 − Higher CIBC FirstCaribbean Other (86) (96) (90) revenue mainly driven by FX Revenue (2) 89 83 88 Provision for (reversal of) Credit Losses 4 5 (12) − Higher TEB revenue offset Non-Inter
Slide 11: Capital
11 Capital CET1 Ratio (all-in basis) • Strong internal capital generation • Share issuance driven by DRIP • Impact of weaker CAD • Partially offset by higher Risk Weighted Assets
Slide 12: Second Quarter, 2017 Risk Review
Second Quarter, 2017 Risk Review Laura Dottori-Attanasio Senior Executive Vice-President and Chief Risk Officer
Slide 13: Provision for Credit Losses
13 Provision for Credit Losses Adjusted ($MM) (1) Q2/16 Q1/17 Q2/17 vs. Q1/17: Retail and Business Banking 199 205 196 Wealth Management - - - • Lower losses in Credit Cards, Capital Markets 81 2 (5) CIBC FirstCaribbean 4 10 2 Capital Markets and CIBC Collective Provision for Non-Impaired Loans - (5
Slide 14: Impaired Loans and Formations
14 Impaired Loans and Formations Reported ($MM) Q2/16 Q1/17 Q2/17 • New formations relatively stable Consumer 334 314 349 QoQ Business and Government 691 85 40 Total New Formations 1,025 399 389 • Gross impaired loans down QoQ, mainly due to a decrease in the oil & gas sector, partially offset Gross
Slide 15: Canadian Real Estate Secured Personal Lending
Canadian Real Estate Secured 15 Personal Lending 90+ Days Delinquency Rates Q2/16 Q1/17 Q2/17 • Uninsured mortgages in the Total Mortgages 0.27% 0.26% 0.25% Greater Vancouver Area(1) (GVA) Uninsured Mortgages 0.22% 0.19% 0.19% and Greater Toronto Area(1) (GTA) Uninsured Mortgages in GVA (1) 0.04% 0.
Slide 16: Canadian Uninsured Residential Mortgages – Q2/17 Originations
Canadian Uninsured Residential Mortgages – 16 Q2/17 Originations Beacon Distribution 40% • $11B of originations in Q2/17 35% 36% 32% 32% 28% • Average LTV(1) in Canada: 64% 17% − GVA(2): 58% 15% 16% 9% 10% 10% − GTA(2): 62% 7% 7% 6% ≤650 651-700 701-750 751-800 >800 (2) (2) Canada GVA GTA Loan-to-Va
Slide 17: Canadian Uninsured Residential Mortgages
17 Canadian Uninsured Residential Mortgages Beacon Distribution 40% 40% • Better current Beacon and LTV(1) 38% distributions in GVA(2) and GTA(2) than 28% 27% 29% the Canadian average 15% • About 1% of this portfolio has a 13% 14% 13% 8% 11% 10% Beacon score of 650 or lower and an 7% 7% LTV(1) over
Slide 18: Canadian Credit Cards and Unsecured Personal Lending
Canadian Credit Cards and Unsecured 18 Personal Lending 90+ Days Delinquency Rates Q2/16 Q1/17 Q2/17 • 90+ days delinquency rates: Total Credit Cards (1) 0.77% 0.88% 0.84% − Credit Cards up YoY Credit Cards in Oil Provinces 0.90% 1.08% 1.06% Total Unsecured Personal Lending 0.55% 0.51% 0.47% − Unsec
Slide 19: Trading Revenue (TEB) Distribution
19 Trading Revenue (TEB)(1) Distribution(2) ($MM) ($MM) 25 25 20 20 15 15 10 10 5 5 0 0 (5) (5) (10) (10) (15) (15) Feb-17 Mar-17 Apr-17 Trading Revenue (TEB) VaR 1 Non-GAAP financial measure. See slide 30 for further details. 2 Trading revenue distribution on which VaR is calculated is not on a TEB
Slide 20: Appendix
Appendix
Slide 21: Retail & Business Banking – Loans & Deposits
21 Retail & Business Banking – Loans & Deposits Average Loans & Acceptances ($B) Average Deposits ($B) +11% +8% Growth YoY QoQ Growth YoY QoQ Residential Mortgages 12% 2% Personal Deposits & GICs 7% 1% Personal Loans 6% 2% Business Deposits & GICs 11% (1)% Credit Cards 3% (2)% Business Lending 11% 3
Slide 22: Wealth – Mutual Funds & Client Asset Balances
22 Wealth – Mutual Funds & Client Asset Balances Canadian Retail Mutual Funds ($B) +16% AUA ($B)(1) AUM ($B)(1) 1 Assets under management (AUM) are included in assets under administration (AUA).
Slide 23: Retail & Business Banking
23 Retail & Business Banking Reported ($MM) Q2/16 Q1/17 Q2/17 Personal Banking 1,713 1,836 1,771 Business Banking 423 453 447 Other 14 307 7 Revenue 2,150 2,596 2,225 Provision for Credit Losses 199 205 196 Non-Interest Expenses 1,105 1,129 1,149 Income Before Income Taxes 846 1,262 880 Income Taxes
Slide 24: Wealth Management
24 Wealth Management Reported ($MM) Q2/16 Q1/17 Q2/17 Retail Brokerage 312 352 352 Asset Management 179 194 207 Private Wealth Management 91 107 100 Other 1 - - Revenue 583 653 659 Non-Interest Expenses 432 469 461 Income Before Income Taxes 151 184 198 Income Taxes 38 51 44 Net Income - Reported 11
Slide 25: Capital Markets
25 Capital Markets it Reported ($MM) Q2/16 Q1/17 Q2/17 Global Markets 469 531 407 Corporate & Investment Banking 296 335 326 Other (15) 11 - (1) Revenue 750 877 733 Provision for (reversal of) Credit Losses 81 2 (5) Non-Interest Expenses 351 382 363 Income Before Income Taxes 318 493 375 Income Taxe
Slide 26: Corporate & Other
26 Corporate & Other Reported ($MM) Q2/16 Q1/17 Q2/17 International Banking 175 179 178 Other (27) (96) (97) (1) Revenue 148 83 81 Provision for (reversal of) Credit Losses 44 5 (12) Non-Interest Expenses 354 294 302 Loss Before Income Taxes (250) (216) (209) Income Taxes (1) (174) (166) (166) Net L
Slide 27: Oil & Gas Corporate & Business Banking Exposure
Oil & Gas Corporate & Business Banking 27 Exposure Direct Exposure(1) ($B) • $17.4B of direct exposure(1), up 17.7 17.4 16.5 17.2 16.8 from $16.8B last quarter − 71% of this is investment grade • $6.2B drawn exposure(1), up from $6.1B last quarter Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 − 58% of this is inves
Slide 28: Oil & Gas Retail Exposure
28 Oil & Gas Retail Exposure Retail Exposure(1) in Oil Provinces(2) ($B) • $40.8B of retail exposure(1) to oil 39.3 39.7 40.2 40.5 40.8 provinces(2) (or $21B excluding insured mortgages) − Alberta accounts for $32.1B or 79% of the retail exposure(1), with a LTV(3) of 66% in the Q2/16 Q3/16 Q4/16 Q1/
Slide 29: Q2 2017 Items of Note
29 Q2 2017 Items of Note Pre-Tax After-Tax & EPS Reporting Effect NCI Effect Effect Segments ($MM) ($MM) ($/Share) Q2 2017 Transaction and integration-related costs associated with the 20 15 0.04 Corporate & Other acquisition of PrivateBank Retail & Business Banking / Amortization of intangible asse
Slide 30: Non-GAAP Financial Measures
30 Non-GAAP Financial Measures • Adjusted results are Non-GAAP financial measures that do not have any standardized meaning prescribed by GAAP and are therefore unlikely to be comparable to similar measures presented by other issuers. • For further details on items of note see slide 29 of this prese