Canadian Imperial Bank Of Commerce · TSX:CM
Canadian Imperial Bank Of Commerce — CIBC — Q4 2014 Earnings Presentation
32 slides from Canadian Imperial Bank Of Commerce's earnings presentation, December 2014
Slide 1: CIBC Investor Presentation Fourth Quarter, 2014
CIBC Investor Presentation Fourth Quarter, 2014 December 2014
Slide 2: Forward-Looking Statements
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 presentation, in other filings with Canadian securities regulators or the U.S. Securities and Exchange Commission and in other communicati
Slide 3: CIBC Overview
CIBC Overview Victor Dodig President and Chief Executive Officer
Slide 4: 2014 Highlights
2014 Highlights 2013 2014 Key Messages: Net Income ($MM) – Reported 3,350 3,215 Net Income ($MM) – Adjusted (1 ) 3,569 3,657 Record adjusted earnings in 2014 – with solid results across all businesses Diluted EPS – Reported $8.11 $7.86 Investment in strategic initiatives yielding positive result
Slide 5: Fourth Quarter, 2014 Financial Review
Fourth Quarter, 2014 Financial Review Kevin Glass Senior Executive Vice-President and Chief Financial Officer
Slide 6: Fourth Quarter, 2014 Summary
Fourth Quarter, 2014 Summary Q4/13 Q4/14 Key Messages: Net Income ($MM) – Reported 825 811 Net Income ($MM) – Adjusted (1 ) 894 911 Client focused strategy progressing well Strong growth in CIBC Retail and Wealth Diluted EPS – Reported $2.02 $1.98 Management assets (1 ) Diluted EPS – Adjusted $2
Slide 7: Retail & Business Banking
Retail & Business Banking (1 ) Adjusted ($MM) Q4/13 Q3/14 Q4/14 (3) Personal Banking 1,555 1,614 1,636 Business Banking 386 389 393 (3) Other 146 29 27 Revenue 2,087 2,032 2,056 Provision for Credit Losses 215 177 171 (3) (3) (3) Non-Interest Expenses 1,029 1,057 1,063 (1 ) Net Income – Adjusted 632
Slide 8: Wealth Management
Wealth Management (1 ) Adjusted ($MM) Q4/13 Q3/14 Q4/14 Retail Brokerage 272 307 302 (3) (3) (3) Asset Management 167 187 206 Private Wealth Management 33 75 79 Revenue 472 569 587 Provision for Credit Losses 1 - - (3) (3) Non-Interest Expenses 335 405 424 (1 ) Net Income – Adjusted 105 124 124 Net
Slide 9: Wholesale Banking
Wholesale Banking Adjusted ($MM) (1 ) Q4/13 Q3/14 Q4/14 (3) Capital Markets 279 336 308 (3) Corporate & Investment Banking 246 278 265 (3) (3) (3) Other 13 5 4 Revenue (2 ) 538 619 577 Provision for (reversal of) Credit Losses (1) 6 14 (3) (3) (3) Non-Interest Expenses 269 278 292 Net Income – Adjus
Slide 10: Corporate & Other
Corporate & Other Adjusted ($MM) (1 ) Q4/13 Q3/14 Q4/14 International Banking 148 151 150 (3) Other (45) (62) (35) (2 ) Revenue 103 89 115 Provision for Credit Losses 56 12 9 (3) (3) (3) Non-Interest Expenses 227 290 288 (1 ) Net Income – Adjusted (60) (67) (45) Net Income – Reported (100) (71) (46)
Slide 11: Capital
Capital Common Equity Tier 1 Ratio Risk-Weighted Assets (all-in basis) ($B; all-in basis) 137 141 136 140 141 10.3% 10.0% 10.1% 9.5% 9.4% Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 vs. Q3/14: Variance in Common Equity Tier 1 Ratio: - Higher earnings, net of dividends - Partially o
Slide 12: 2014 Highlights
2014 Highlights Client focused strategy progressing well CIBC Strong financial results across all businesses Aventura and Tim Hortons cards off to a great start Retail & Business Strong YoY growth in CIBC Brand products – Deposits up 9%; Mortgages up 15%; Banking Branch Mutual Funds up 17%
Slide 13: Fourth Quarter, 2014 Risk Review
Fourth Quarter, 2014 Risk Review Laura Dottori-Attanasio Senior Executive Vice-President and Chief Risk Officer
Slide 14: Provision for Credit Losses (Adjusted)
Provision for Credit Losses (Adjusted) (1) Adjusted ($MM) Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 (2) Retail and Business Banking 215 184 173 177 171 Wealth Management 1 (1) 1 - - (2) Wholesale Banking (1) 2 (1) 6 14 (2) CIBC FirstCaribbean 54 33 24 26 17 (2) Collective Provision for Non-Impaired 2 - (2) (12)
Slide 15: Impaired Loans and Formations
Impaired Loans and Formations Reported ($MM) Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Consumer 362 352 291 308 299 Business and Government 62 65 46 53 25 Total New Formations 424 417 337 361 324 Gross and Net Impaired Loans (by geography) 1,587 1,547 1,521 1,492 1,434 vs. Q3/14: Lower new formations across b
Slide 16: Cards
Cards 200 6% 5% 160 193 4% 120 180 ($MM) 179 167 3% 156 154 80 142 142 127 2% 113 102 99 96 40 1% 0 0% Q4/11 Q2/12 Q4/12 Q2/13 Q4/13 Q2/14 Q4/14 (1) (1, 2) (3) Adjusted Net Credit Losses (NCL) Adjusted NCL Rate 30+ Days Delinquency Rate Comments: Credit quality of the portfolio continues to remain
Slide 17: Canadian Residential and Condo Mortgage Portfolios
Canadian Residential and Condo Mortgage Portfolios Canadian Residential Mortgage Portfolio (includes Condo): $152B Residential Mortgages Residential Mortgages Composition (includes condos) Average 33% LTV(1) of Uninsured 60% Condo Residential Mortgage Mortgages $17B (excludes Condo) $135B Insured 67
Slide 18: Canadian Condo Developer Exposure
Canadian Condo Developer Exposure Canadian Condo Developer Portfolio: $3.0B 2.9 3.0 3.0 2.8 2.9 2.7 2.8 2.7 2.6 0.9 0.9 1.0 0.7 0.8 0.9 0.8 0.8 1.0 ($B) 2.0 2.0 2.0 2.0 2.1 1.9 2.0 1.8 1.8 Q4/12 Q2/13 Q4/13 Q2/14 Q4/14 Undrawn Drawn Number of Projects: 70 73 75 78 79 70 73 80 88 | 18
Slide 19: Trading Revenue Distribution and Daily Trading Revenue versus VaR
Trading Revenue (TEB)(1) Distribution(2) Daily Trading Revenue versus Value-at-Risk (VaR) ($MM) ($MM) 20 20 15 15 10 10 5 5 0 0 (5) (5) (10) (10) (15) (15) Aug-14 Sep-14 Oct-14 Trading Revenue (TEB) VaR (1) Non-GAAP financial measure. See slide 32 for further details. (2) Trading revenue (TEB) compr
Slide 20: Appendix
CIBC a Appendix
Slide 21: CIBC Statement of Operations
CIBC Statement of Operations Reported ($MM) Q4/13 Q3/14 Q4/14 (2) (2) (2) Net Interest Income 1,893 1,875 1,881 (2) (2) (2) Non-Interest Income 1,287 1,483 1,336 Revenue 3,180 3,358 3,217 Provision for Credit Losses 271 195 194 (2) (2) (2) Non-Interest Expenses 1,930 2,047 2,087 Income Before Taxes
Slide 22: Retail & Business Banking
Retail & Business Banking Reported ($MM) Q4/13 Q3/14 Q4/14 (3) Personal Banking 1,555 1,614 1,633 Business Banking 386 389 393 (3) Other 146 29 24 Revenue 2,087 2,032 2,050 Provision for Credit Losses 215 177 171 (3) (3) (3) Non-Interest Expenses 1,055 1,067 1,076 Income Before Taxes 817 788 803 Tax
Slide 23: Wealth Management
Wealth Management Reported ($MM) Q4/13 Q3/14 Q4/14 Retail Brokerage 272 307 302 (3) (3) (3) Asset Management 165 186 203 Private Wealth Management 33 75 79 Revenue 470 568 584 Provision for Credit Losses 1 - - (3) (3) Non-Interest Expenses 335 408 428 Income Before Taxes 134 160 156 Taxes 31 39 37 N
Slide 24: Wholesale Banking
Wholesale Banking Reported ($MM) Q4/13 Q3/14 Q4/14 (3) Capital Markets 279 336 196 (3) Corporate & Investment Banking 246 330 265 (3) (3) (3) Other (5) 4 7 (1 ) Revenue 520 670 468 Provision for (reversal of) Credit Losses (1) 6 14 (3) (3) (3) Non-Interest Expenses 271 279 293 Income Before Taxes 25
Slide 25: Corporate & Other
Corporate & Other Reported ($MM) Q4/13 Q3/14 Q4/14 International Banking 148 151 150 (3) Other (45) (63) (35) Revenue (1 ) 103 88 115 Provision for Credit Losses 56 12 9 (3) (3) (3) Non-Interest Expenses 269 293 290 Income Before Taxes (222) (217) (184) (1 ) Taxes (122) (146) (138) Net Income – Repo
Slide 26: Balances Retail & Business Banking and Wealth Management
Balances Retail & Business Banking and Wealth Management Balances (1) ($B) Q4/13 Q3/14 Q4/14 Cards 14.7 11.5 11.5 CIBC Brand Mortgages 106.0 115.5 120.5 CIBC Brand Personal Lending 30.2 30.6 30.9 CIBC Brand Personal Deposits & GICs 85.8 87.9 89.1 Business Deposits 38.0 42.5 42.6 Business Lending 37.
Slide 27: Fourth Quarter, 2014 - Structured Credit Run-off
Fourth Quarter, 2014 - Structured Credit Run-off Pre-tax Pre-Tax After-tax EPS Q1/11 Effect Q4/11 After-Tax Effect Effect Q1/12 EPS Effect Effect Effect ($MM) ($MM) ($MM) ($/Share) ($MM) ($/share) Credit Valuation Adjustments with Financial Guarantors 2 2 0.00 Purchased Credit Derivatives Hedging Lo
Slide 28: Loans and Acceptances
Loans and Acceptances(1) Reported ($MM) Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Residential mortgages 150,778 151,785 152,343 154,801 157,317 Personal 33,990 33,918 34,293 34,632 34,998 Credit card 14,255 11,004 11,131 11,167 11,243 Net Consumer Loans 199,023 196,707 197,767 200,600 203,558 Non-Residential Mo
Slide 29: Provision for Credit Losses
Provision for Credit Losses Reported ($MM) Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Retail and Business Banking 215 210 173 177 171 Wealth Management 1 (1) 1 - - Wholesale Banking (1) 2 21 6 14 CIBC FirstCaribbean 54 33 131 26 17 Collective Provision for Non-Impaired 2 (26) 4 (14) (8) Corporate and Other 56 7
Slide 30: 2014 Items of Note
2014 Items of Note Pre-tax Pre-Tax After-tax After-Tax EPS Effect EPS Operating Effect Effect Effect Effect ($MM) Effect Segments ($MM) ($MM) ($MM) ($/Share) ($/share) Strategic Business Unit Q4 2014 Charge relating to the incorporation of funding valuation adjustments (FVA) into the (112) (82) (0.2
Slide 31: 2013 Items of Note
2013 Items of Note Pre-tax Pre-Tax After-tax After-Tax EPS Effect EPS Operating Effect Effect Effect Effect ($MM) Effect Segments ($MM) ($MM) ($MM) ($/Share) ($/share) Strategic Business Unit Q4 2013 (1) Beginning in the Restructuring charge relating to CIBC FirstCaribbean (39) (37) (0.09) Corporate
Slide 32: Non-GAAP Financial Measures Adjusted Results
Non–GAAP Financial Measures Adjusted Results These terms 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 30 and