Canadian Imperial Bank Of Commerce · TSX:CM
Canadian Imperial Bank Of Commerce — CIBC — Q3 2018 Earnings Presentation
25 slides from Canadian Imperial Bank Of Commerce's earnings presentation, Aug 23, 2018
Slide 1: CIBC Investor Presentation Q3 F18
CIBC Investor Presentation Q3 F18 August 23, 2018
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: Third Quarter, 2018 Financial Review
Third Quarter, 2018 Financial Review Kevin Glass Senior Executive Vice-President and Chief Financial Officer
Slide 5: Third Quarter, 2018 Highlights
5 Third Quarter, 2018 Highlights Adjusted1 Q3/17 Q2/18 Q3/18 Earnings1 ($MM, except for EPS, Efficiency Ratio, ROE, and CET1 Ratio) • EPS growth of 11% YoY Revenue 4,113 4,361 4,535 • Operating leverage of 4.3% Non-Interest Expenses 2,368 2,467 2,520 • ROE of 17.1% Pre-Provision Earnings 1,745 1,894
Slide 6: Capital
6 Capital CET1 Ratio (all-in basis) 36bps 2bps (16)bps (10)bps 11.3% 11.2% Q2/18 Earnings net of RWAs (excl. FX) Share Other Q3/18 Dividends Repurchases • Strong internal capital generation Partially offset by: • RWA growth • Share repurchases
Slide 7: Canadian Personal and Small Business Banking
7 Canadian Personal and Small Business Banking Strong results driven by solid top-line growth and expense discipline Adjusted1 Q3/17 Q2/18 Q3/18 • Strong revenue driven by loan growth ($MM) and margin expansion Personal & Small Business Banking 2,028 2,076 2,165 − Loans up 4% YoY Other 11 14 11 Reve
Slide 8: Canadian Commercial Banking and Wealth Management
Canadian Commercial Banking and 8 Wealth Management Volume growth and well-contained expenses driving strong performance Adjusted1 Q3/17 Q2/18 Q3/18 • Strong earnings growth of 20% driven ($MM) by solid volume growth in Commercial Commercial Banking 333 359 389 Banking Wealth Management 570 578 599
Slide 9: U.S. Commercial Banking and Wealth Management
U.S. Commercial Banking and 9 Wealth Management Continued focus on building an integrated bank with deep client relationships Adjusted 1 Q3/172 Q2/18 Q3/18 • Solid volume growth in Commercial ($MM) Banking Commercial Banking 152 274 294 Wealth Management 82 136 142 • Cross-border initiatives continu
Slide 10: Capital Markets
10 Capital Markets Delivering diversified and profitable results 1 Adjusted Q3/17 Q2/18 Q3/18 • Strong trading revenue, particularly in ($MM) equities and FX Global Markets 362 409 408 • Higher advisory activity Corporate & Investment Banking 318 293 350 Other (1) 8 (6) • Continued strong performanc
Slide 11: Corporate and Other
11 Corporate and Other Adjusted1 Q3/17 Q2/18 Q3/18 • Government of Barbados loans and ($MM) securities restructuring impacting results International Banking 183 185 172 in CIBC FirstCaribbean Other 70 25 11 − $15MM decrease in revenue Revenue2 253 210 183 − Majority of impaired PCL increase Non-Inte
Slide 12: Third Quarter, 2018 Risk Review
Third Quarter, 2018 Risk Review Laura Dottori-Attanasio Senior Executive Vice-President and Chief Risk Officer
Slide 13: Provision for Credit Losses
13 Provision for Credit Losses IAS 39 IFRS 9 1 Adjusted Q3/17 Q2/18 Q3/18 Provision for Impaired up QoQ ($MM) • Credit conditions remain fairly stable Canadian Personal and Small Business Banking 188 199 199 Canadian Commercial Banking and Wealth • Higher loan losses in: (3) 1 2 Management − CIBC Fi
Slide 14: Credit Quality — Gross Impaired Loans
14 Credit Quality — Gross Impaired Loans IAS 39 IFRS 9 Reported Q3/17 Q2/18 Q3/18 • Residential mortgages and personal Canadian Residential Mortgages 0.14% 0.25% 0.24% lending remains stable Canadian Personal Lending 0.30% 0.32% 0.31% • CIBC Bank USA increase attributable to two new impairments CIBC
Slide 15: Credit Quality — Net Write-offs
15 Credit Quality — Net Write-offs Reported Q3/17 Q2/18 Q3/18 • Residential mortgages, credit cards and Canadian Residential Mortgages 0.02% 0.01% 0.01% personal lending remain stable Canadian Credit Cards 3.33% 3.41% 3.28% • Business and government loans up YoY Canadian Personal Lending 0.78% 0.74%
Slide 16: Canadian Credit Cards and Unsecured Personal Lending
Canadian Credit Cards and Unsecured 16 Personal Lending IAS 39 IFRS 9 90+ Days Delinquency Rates Q3/17 Q2/18 Q3/18 • Delinquency rates declined in the quarter following the previous Canadian Credit Cards 0.75% 0.90% 0.78% quarter's seasonal high Canadian Unsecured Personal Lending 1 0.47% 0.50% 0.48
Slide 17: Appendix
Appendix
Slide 18: Canadian Personal and Small Business Banking Market Share
Canadian Personal and Small Business 18 Banking Market Share Q3/18 YoY Most Current Absolute YoY Balances Growth 1 Rank Growth Market Share ($B) Rank Money-In Personal Deposits & GICs 144 1.1% 16.6% 4 6 Canadian Retail Mutual Fund AUM 106 8.6% 15.5% 3 3 Small Business Deposits & GICs 22 2.1% 13.8% 3
Slide 19: Reported Results ($MM)
19 Reported Results ($MM) Total Bank Q3/17 Q2/18 Q3/18 Canadian Personal & Small Business Banking Q3/17 Q2/18 Q3/18 Revenue 4,104 4,376 4,547 Personal & Small Business Banking 2,028 2,076 2,165 Non-Interest Expenses 2,452 2,517 2,572 Other 11 14 11 Pre-Provision Earnings 1,652 1,859 1,975 Revenue 2,
Slide 20: Canadian Real Estate Secured Personal Lending
20 Canadian Real Estate Secured Personal Lending IAS 39 IFRS 9 90+ Days Delinquency Rates Q3/17 Q2/18 Q3/18 • Delinquency rates remain relatively stable Total Mortgages 0.23% 0.25% 0.24% • The Greater Vancouver Area1 (GVA) and Uninsured Mortgages 0.17% 0.20% 0.19% Greater Toronto Area1 (GTA) continu
Slide 21: Canadian Uninsured Residential Mortgages — Q3/18 Originations
Canadian Uninsured Residential Mortgages — 21 Q3/18 Originations Beacon Distribution • Originations of $9B in Q3/18 • Average LTV1 in Canada: 63% 37%41%40% − GVA2: 55% 31%29%30% − GTA2: 60% 16%14%15% 11%12%11% 5% 4% 4% ≤650 651-700 701-750 751-800 >800 2 2 Canada GVA GTA Loan-to-Value (LTV)1 Distrib
Slide 22: Canadian Uninsured Residential Mortgages
22 Canadian Uninsured Residential Mortgages Beacon Distribution • Better current Beacon and LTV1 distributions in GVA2 and GTA2 than the Canadian average 40%43%40% 27%25%28% • 1% of this portfolio has a Beacon score of 650 or lower and an LTV1 over 75% 7% 6% 6% 14%12%14% 12%14%12% • Average LTV1 in
Slide 23: Trading Revenue (TEB) Distribution
23 Trading Revenue (TEB)1 Distribution2 ($MM) ($MM) 30 30 25 25 20 20 15 15 10 10 5 5 0 0 (5) (5) (10) (10) May-18 Jun-18 Jul-18 Trading Revenue VaR 1 Non-GAAP financial measure. See slide 25 for further details. 2 Trading revenue (TEB) comprises both trading net interest income and non-interest inc
Slide 24: Q3 2018 Items of Note
24 Q3 2018 Items of Note After-Tax Pre-Tax EPS & NCI Reporting Effect Effect Effect Segments ($MM) ($/Share) ($MM) Canadian Personal & Small Business Banking/ Amortization of acquisition-related 31 23 0.05 U.S. Commercial Banking & Wealth Management/ intangible assets Corporate & Other Transaction a
Slide 25: Non-GAAP Financial Measures
25 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 24 of this prese