Canadian Imperial Bank Of Commerce · TSX:CM
Canadian Imperial Bank Of Commerce — CIBC — Q1 2019 Earnings Presentation
27 slides from Canadian Imperial Bank Of Commerce's earnings presentation, Feb 28, 2019
Slide 1: CIBC Investor Presentation Q1 F19
CIBC Investor Presentation Q1 F19 February 28, 2019
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: First Quarter, 2019 Financial Review
First Quarter, 2019 Financial Review Kevin Glass Senior Executive Vice-President and Chief Financial Officer
Slide 5: First Quarter, 2019 Highlights
5 First Quarter, 2019 Highlights Adjusted1 Q1/18 Q4/18 Q1/19 Earnings1 ($MM, except for EPS, Efficiency Ratio, ROE, and CET1 Ratio) • Operating leverage of 1.3% Revenue 4,432 4,504 4,552 • ROE of 16.0% Non-Interest Expenses 2,529 2,548 2,501 • Pre-Provision Earnings growth of 8% YoY Pre-Provision Ea
Slide 6: Capital
6 Capital CET1 Ratio 34 bps 7 bps 11.4% (36) bps (14) bps (8) bps 11.2% Q4/18 Earnings net of RWAs Regulatory Air Canada Other Q1/19 Dividends (excl. FX) Changes Transaction • Strong internal capital generation Offset by: • RWA growth • Regulatory changes • Air Canada loyalty program
Slide 7: Canadian Personal and Small Business Banking
7 Canadian Personal and Small Business Banking Results driven by expense discipline and revenue growth Adjusted1 Q1/18 Q4/18 Q1/19 • Solid performance driven by volume ($MM) growth and strong margins Revenue 2,138 2,201 2,166 − NIM up 7 bps YoY Non-Interest Expenses 1,096 1,098 1,098 Pre-Provision E
Slide 8: Canadian Commercial Banking and Wealth Management
Canadian Commercial Banking and 8 Wealth Management Volume growth and expense management driving strong performance 1 Adjusted Q1/18 Q4/18 Q1/19 • Continued strong performance in ($MM) Commercial Banking driven by volume Commercial Banking 354 386 413 growth, wider spreads and higher fee Wealth Mana
Slide 9: U.S. Commercial Banking and Wealth Management
U.S. Commercial Banking and 9 Wealth Management Strong YoY results driven by organic growth, margin expansion, and a stronger US dollar 1 Adjusted Q1/18 Q4/18 Q1/19 • Investments in new markets, along with ($MM) continued client development, generated Commercial Banking 281 304 321 strong, diversifi
Slide 10: Capital Markets
10 Capital Markets Continued focus on delivering diversified earnings Adjusted1 Q1/18 Q4/18 Q1/19 • Strong revenue growth QoQ ($MM) − Higher trading revenues, advisory Global Markets 486 371 414 fees and Corporate Banking revenue Corporate & Investment Banking2 315 278 291 Revenue3 801 649 705 • Low
Slide 11: Corporate and Other
11 Corporate and Other Adjusted1 Q1/18 Q4/18 Q1/19 • Higher revenue in CIBC FirstCaribbean ($MM) International Banking 179 188 197 • Lower TEB revenue offset YoY Other (53) 32 26 • Disciplined expense management 2 Revenue 126 220 223 Non-Interest Expenses 304 330 268 Pre-Provision Earnings (178) (11
Slide 12: First Quarter, 2019 Risk Review
First Quarter, 2019 Risk Review Laura Dottori-Attanasio Senior Executive Vice-President and Chief Risk Officer
Slide 13: Provision for Credit Losses
13 Provision for Credit Losses Reported Q1/18 Q4/18 Q1/19 Provision for Credit Losses up QoQ ($MM) • Overall credit quality remains strong Canadian Personal and Small Business Banking 180 182 192 • Higher provisions in Canadian Canadian Commercial Banking and Wealth 4 8 48 Commercial Banking and Cap
Slide 14: Credit Quality — Gross Impaired Loans
14 Credit Quality — Gross Impaired Loans Reported Q1/18 Q4/18 Q1/19 Gross Impaired Loans up QoQ Canadian Residential Mortgages 0.23% 0.24% 0.27% • Higher gross impaired loans in: Canadian Personal Lending 0.30% 0.33% 0.34% - Canadian residential mortgages CIBC Business & Government Loans 1 0.40% 0.2
Slide 15: Credit Quality — Canadian Consumer Net Write-offs
Credit Quality — Canadian Consumer 15 Net Write-offs Reported Q1/18 Q4/18 Q1/19 Net Write-offs were stable QoQ and YoY Canadian Residential Mortgages 0.01% 0.01% 0.01% Canadian Credit Cards 2.99% 3.05% 3.02% Canadian Personal Lending 0.72% 0.79% 0.76% Total 0.26% 0.28% 0.27% 400 4.00% 400 350 Net Wr
Slide 16: Credit Quality — Canadian Personal Banking Delinquencies
Credit Quality — Canadian Personal Banking 16 Delinquencies 90+ Days Delinquency Rates Q1/18 Q4/18 Q1/19 90+ Days Delinquency rates up YoY Residential Mortgages 0.23% 0.24% 0.27% • Residential mortgages higher in the Uninsured 0.19% 0.19% 0.21% insured segment where losses would Insured 0.30% 0.34%
Slide 17: Trading Revenue (TEB) Distribution
17 Trading Revenue (TEB)1 Distribution2 ($MM) ($MM) 20 20 15 15 10 10 5 5 0 0 (5) (5) (10) Nov-18 Dec-18 Jan-19 (10) Trading Revenue VaR 1 Non-GAAP financial measure. See slide 27 for further details. 2 Trading revenue (TEB) comprises both trading net interest income and non-interest income and excl
Slide 18: Appendix
Appendix
Slide 19: Canadian Personal Banking Digital Transformation
Canadian Personal Banking Digital 19 Transformation1 Digital Adoption Rate2 Active Mobile Users3 (Millions) 470 bps 33.5% 64.4% 67.1% 2.7 62.4% 2.3 2.0 Q1/17 Q1/18 Q1/19 Q1/17 Q1/18 Q1/19 Banking Centres Self-Serve Transactions4 (%) -5.4% 330 bps 1,105 1,076 88.6% 1,045 86.9% 85.3% Q1/17 Q1/18 Q1/19
Slide 20: Canadian Personal and Small Business Banking Market Share
Canadian Personal and Small Business 20 Banking Market Share Q1/19 Balances YoY Most Current Absolute YoY Growth ($B) Growth Market Share1 Rank Rank Money-In Personal Deposits & GICs 151 3.6% 16.7% 4 4 Canadian Retail Mutual Fund and ETF AUM 102 -1.0% 13.5% 5 4 Small Business Deposits & GICs 23 2.8%
Slide 21: Reported Results ($MM)
21 Reported Results ($MM) Total Bank Q1/18 Q4/18 Q1/19 Canadian Personal & Small Business Banking Q1/18 Q4/18 Q1/19 Revenue 4,459 4,452 4,565 Revenue 2,138 2,201 2,166 Non-Interest Expenses 2,578 2,591 2,760 Non-Interest Expenses 1,098 1,100 1,327 Pre-Provision Earnings 1,881 1,861 1,805 Pre-Provisi
Slide 22: Oil & Gas Retail Exposure
22 Oil & Gas Retail Exposure Retail Exposure1 in Oil Provinces ($B) • $40.8B of retail exposure1 to oil provinces2 (or $23.1B excluding insured mortgages) 41.3 41.2 41.2 41.1 40.8 − Alberta accounts for $32.3B or 79% of the retail exposure1 − Average LTV3 of 66% in the uninsured mortgage portfolio Q
Slide 23: Canadian Real Estate Secured Personal Lending
23 Canadian Real Estate Secured Personal Lending 90+ Days Delinquency Rates Q1/18 Q4/18 Q1/19 • Delinquency rates increased in Q1/19 Total Mortgages 0.23% 0.24% 0.27% • The Greater Vancouver Area1 (GVA) and Greater Toronto Area1 (GTA) continue to Uninsured Mortgages 0.19% 0.19% 0.21% outperform the
Slide 24: Canadian Uninsured Residential Mortgages — Q1/19 Originations
Canadian Uninsured Residential Mortgages — 24 Q1/19 Originations Beacon Distribution • Originations of $6B in Q1/19 • Average LTV1 in Canada: 64% 39%39% − GVA2: 56% 32%30%31% 36% − GTA2: 61% 16%15%15% 6% 6% 5% 10%10%10% ≤650 651-700 701-750 751-800 >800 2 2 Canada GVA GTA Loan-to-Value (LTV)1 Distri
Slide 25: Canadian Uninsured Residential Mortgages
25 Canadian Uninsured Residential Mortgages Beacon Distribution • Better current Beacon and LTV1 distributions in GVA2 and GTA2 than the Canadian average 39%42%40% 27%24%27% • Less than 1% of this portfolio has a Beacon score of 650 or lower and an LTV1 14%12%13% 13%16%13% 7% 6% 7% over 75% • Averag
Slide 26: Q1 2019 Items of Note
26 Q1 2019 Items of Note After-Tax Pre-Tax EPS & NCI Reporting Effect Effect Effect Segments ($MM) ($/Share) ($MM) Charge for a payment made to Air Canada, including related sales tax and 227 167 0.38 Canadian Personal & Small Business Banking transaction costs, to secure our participation in the ne
Slide 27: Non-GAAP Financial Measures
27 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 26 of this prese