Canadian Imperial Bank Of Commerce · TSX:CM
Canadian Imperial Bank Of Commerce — CIBC — Q4 2007 Earnings Presentation
30 slides from Canadian Imperial Bank Of Commerce's earnings presentation, Dec 6, 2007
Slide 1: Fourth Quarter 2007 Investor Presentation
Fourth Quarter, 2007 Investor Presentation CIBC Investor Presentation December 6, 2007 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 securi
Slide 2: CIBC Overview
Fourth Quarter, 2007 Investor Presentation CIBC Overview Gerry McCaughey President and Chief Executive Officer Fourth Quarter, 2007 Financial & Risk Review Tom Woods Senior Executive Vice-President and Chief Financial Officer 2
Slide 3: Q4 Summary
Fourth Quarter, 2007 Investor Presentation Q4 Summary $ Per Share EPS(1): $2.53 Includes(3) – Visa Gain 1.13 Cash EPS(2): $2.55 – Write-downs re. CDO/RMBS (0.89) – Costs re. Proposed Sale of some See Slides 51 - 52 U.S. Businesses (0.08) for Structured – Net Reversal of Litigation Accruals 0.06 Cred
Slide 4: Revenue
Fourth Quarter, 2007 Investor Presentation CIBC Revenue F ‘07 ($MM) Q2 Q3 Q4 vs. Q3 Net Interest Income 1,079 1,180 1,240 • Higher dividend Fees for Services revenue, partially offset by lower Underwriting and Advisory 178 192 190 Mortgages & Lending Deposit and Payment 193 205 200 spreads Credit 82
Slide 5: Expenses
Fourth Quarter, 2007 Investor Presentation CIBC Expenses F ‘07 ($MM) Q2 Q3 Q4 vs. Q3 Employee Comp. and (1) Benefits 1,126 1,100 1,006 • Lower performance- related compensation Occupancy Costs 152 152 148 Computer and Office Equip. 279 279 283 Communications 88 77 81 Advertising and Bus. Development
Slide 6: Retail Markets Revenue
Fourth Quarter, 2007 Investor Presentation CIBC Retail Markets Revenue ($MM) (1) 2,652 2,259 2,151 2,189 2,046 Q4 Q1 Q2 Q3 Q4 F ‘06 F ‘07 (1) Affected by an Item of Note, see Slide 48 for details. 11 CIBC Retail Markets Revenue Components F ‘06 F ‘07 ($MM) Q4 Q1 Q2 Q3 Q4 Personal & Small Business Ba
Slide 7: Retail Markets Revenue Components
Fourth Quarter, 2007 Investor Presentation CIBC Retail Markets Revenue Components F ‘06 F ‘07 Personal & Small ($MM) Q4 Q1 Q2 Q3 Q4 Business Banking Personal & Small vs. Q3: Business Banking 522 517 501 537 546 + deposit balances up Imperial Service 230 237 232 247 242 + spreads up Retail Brokerage
Slide 8: Retail Brokerage and Cards Revenue Components
Fourth Quarter, 2007 Investor Presentation CIBC Retail Markets Revenue Components F ‘06 F ‘07 ($MM) Q4 Q1 Q2 Q3 Q4 Retail Brokerage Personal & Small vs. Q3: Business Banking 522 517 501 537 546 – trading volumes down Imperial Service 230 237 232 247 242 – new issues down Retail Brokerage 292 314 306
Slide 9: Mortgages & Personal Lending
Fourth Quarter, 2007 Investor Presentation CIBC Retail Markets Revenue Components F ‘06 F ‘07 Mortgages & Personal ($MM) Q4 Q1 Q2 Q3 Q4 Lending Personal & Small vs. Q3: Business Banking 522 517 501 537 546 – spreads down – prepayment cash Imperial Service 230 237 232 247 242 penalties down Retail Br
Slide 10: Other Revenue and Net Income
Fourth Quarter, 2007 Investor Presentation CIBC Retail Markets Revenue Components F ‘06 F ‘07 ($MM) Q4 Q1 Q2 Q3 Q4 Other Personal & Small vs. Q3: Business Banking 522 517 501 537 546 + Treasury revenue up Imperial Service 230 237 232 247 242 + President’s Choice up Retail Brokerage 292 314 306 308 2
Slide 11: World Markets Revenue
Fourth Quarter, 2007 Investor Presentation CIBC World Markets Revenue ($MM) 784 (1) (1) (1) 726 697 (1) 582 (1) 147 Q4 Q1 Q2 Q3 Q4 F ‘06 F ‘07 (1) Affected by an Item of Note, see Slides 48 and 49 for details. 21 CIBC World Markets Revenue Components F ‘06 F ‘07 ($MM) Q4 Q1 Q2 Q3 Q4 (1) (1) Capital
Slide 12: Capital Markets
Fourth Quarter, 2007 Investor Presentation CIBC World Markets Revenue Components F ‘06 F ‘07 ($MM) Q4 Q1 Q2 Q3 Q4 Capital Markets (1) (1) Capital Markets 351 449 351 28 (249) vs. Q3: + equities up Investment Banking & (1) (1) (1) (1) (1) Credit Products 242 204 247 328 240 Commercial Banking 125 121
Slide 13: Merchant Banking
Fourth Quarter, 2007 Investor Presentation CIBC World Markets Revenue Components F ‘06 F ‘07 ($MM) Q4 Q1 Q2 Q3 Q4 Merchant Banking (1) (1) Capital Markets 351 449 351 28 (249) vs. Q3: + gains & distributions Investment Banking & (1) (1) (1) (1) (1) ($164MM vs. $187MM Credit Products 242 204 247 328
Slide 14: Common Share Dividends
Fourth Quarter, 2007 Investor Presentation Common Share Dividends ($ per share) 0.87 0.77 0.77 0.70 0.70 Q4 Q1 Q2 Q3 Q4 F ‘06 F ‘07 27 CIBC Retail Markets ROE & Cash Efficiency (NIX) Ratio(1) (%) 79 (2) (2) ROE 55 55 53 (2) 48 (2) 61 60 61 59 NIX 50 (2) Q4 Q1 Q2 Q3 Q4 F ‘06 F ‘07 (1) Non-GAAP financ
Slide 15: Mortgages & Cards
Fourth Quarter, 2007 Investor Presentation CIBC Retail Markets Mortgages & Cards(1) ($B; spot; administered assets) 112.6 109.2 Residential 104.3 99.7 101.5 Mortgages 13.3 12.3 12.7 11.7 12.0 Card Loans Q4 Q1 Q2 Q3 Q4 F ‘06 F ‘07 (1) Excludes FirstCaribbean. 29 CIBC Retail Markets Loan Balances(1) (
Slide 16: Market Share
Fourth Quarter, 2007 Investor Presentation CIBC Retail Markets Market Share(1)(2) (%) Residential 14.2 14.1 14.1 14.2 14.2 Mortgages Consumer 19.5 19.8 19.0 19.2 19.3 Deposits Consumer 9.9 9.6 9.5 Loans 9.3 9.0 (excl. cards) Q4 Q1 Q2 Q3 Q4 F ‘06 F ‘07 (1) Source: OSFI (consumer deposits); Bank of Ca
Slide 17: Mutual Funds/Managed Accounts AUM & Market Share
Fourth Quarter, 2007 Investor Presentation CIBC Retail Markets Mutual Funds/Managed Accounts AUM & Market Share(1) MF/Managed Accts AUM Canadian Market Share 70 11 61.1 62.4 61.8 59.3 Market Share (%) 60 55.4 50 $ Billions 9 40 8.8 8.6 8.5 8.5 30 8.4 7 20 10 0 5 Q4 Q1 Q2 Q3 Q4 F ‘06 F ‘07 (1) Source
Slide 18: Imperial Service
Fourth Quarter, 2007 Investor Presentation CIBC Retail Markets Imperial Service Funds Managed Funds Managed/Financial Adviser 100 100 82.9 84.4 85.0 85.1 81.0 80 80 $ Millions $ Billions 71.8 73.9 75.0 76.1 60 70.9 60 40 40 20 20 0 0 Q4 Q1 Q2 Q3 Q4 F ‘06 F ‘07 35 CIBC Retail Markets Discount Brokera
Slide 19: Wood Gundy
Fourth Quarter, 2007 Investor Presentation CIBC Retail Markets Wood Gundy(1) AUA AUA per Investment Adviser 140 120 115.6 117.6 120.4 118.5 118.6 120 100 $ Millions 100 $ Billions 87.0 89.9 90.1 91.5 80 80 84.1 60 60 40 40 20 20 0 0 Q4 Q1 Q2 Q3 Q4 F ‘06 F ‘07 AUA excludes client cash and short posit
Slide 20: Retail plus Commercial Banking
Fourth Quarter, 2007 Investor Presentation CIBC Retail plus Commercial Banking(1) Revenue Net Income F ‘06 F ‘07 F ‘06 F ‘07 ($MM) Q4 Q3 Q4 Q4 Q3 Q4 (2) (2) (2) CIBC Retail Markets 2,046 2,259 2,652 501 555 912 Plus: Commercial 125 127 142 43 42 48 Banking 2,171 2,386 2,794 544 597 960 (1) Commercia
Slide 21: World Markets ROE & Cash Efficiency Ratio
Fourth Quarter, 2007 Investor Presentation CIBC World Markets ROE & Cash Efficiency (NIX) Ratio(1) (%) 44 42 52 37 ROE (13) 162 NIX (2) (TEB) 63 65 67 59 (3) (3) (3) (3) (3) Q4 Q1 Q2 Q3 Q4 F ‘06 F ‘07 (1) Non-GAAP financial measures, see Slide 53. (2) Taxable equivalent basis. Non-GAAP financial mea
Slide 22: World Markets Market Share
Fourth Quarter, 2007 Investor Presentation CIBC World Markets Market Share (%) 16.5 Canadian 14.0 13.3 12.0 10.8 New Equity Issues (1)(2) Equity Trading 8.1 7.6 7.2 7.1 Canada - % 6.4 of shares traded (3) Q4 Q1 Q2 Q3 Q4 F ‘06 F ‘07 (1) Source: CIBC Equity Capital Markets. (2) Based on total amount u
Slide 23: Behind the Reported NIMs
Fourth Quarter, 2007 Investor Presentation Behind the Reported NIMs F ‘07 Q3 Q4 Reported NIM 1.41% 1.45% (1) Reported NIM (TEB) 1.49% 1.58% NIM (TEB) (1) (2) excluding fixed assets 1.70% 1.83% & excluding trading assets and adding back securitizations 2.46% 2.38% (3) (4) & excluding other NII 2.56%
Slide 24: Tax Reconciliation – Q4/07
Fourth Quarter, 2007 Investor Presentation Tax Reconciliation – Q4/07 (A) (B) (B ÷ A) Net Income Tax Tax Rate Tax Rate ($MM) (1) Before Tax Expense Q4/07 F ‘07 Reported 940 45 4.8% 13.6% Tax 75 - Retail/ Adjustments World Markets (2) (3) Adjusted 940 120 12.8% 19.7% (4) TEB Adjustment 116 116 (4) (2
Slide 25: Items of Note
Fourth Quarter, 2007 Investor Presentation Items of Note (Cont’d) Pre-Tax After-Tax EPS Effect Strategic Business Unit Q2 2007 Effect ($MM) Effect ($MM) ($/share) Mark-to-Market on Corporate Loan Credit Derivative portfolio 10 7 0.02 World Mkts Reversal of General Allowance for Credit Losses 24 17 0
Slide 26: Unhedged CDO/RMBS with Exposure to U.S. Sub-prime
Fourth Quarter, 2007 Investor Presentation UNHEDGED CDO/RMBS with Exposure to U.S. (1) Sub-prime Residential Real Estate Oct 31/07 Rating(2) Type Tranche Notional Mark 1. Aaa/AAA CDO of Super US$928MM US$421MM and A/A Mezz RMBS Senior (45%) Net unhedged and CDO2 exposure: US$784MM less 2. Aa/AA and
Slide 27: Non–GAAP Financial Measures
Fourth Quarter, 2007 Investor Presentation Non–GAAP Financial Measures Cash EPS, Taxable Equivalent Basis, Segmented ROE, Cash Efficiency Ratio, Commercial Banking included in Retail, Economic Profit & Economic Capital For further details, see Non-GAAP measures within the Notes to users section on p
Slide 28: Trading Revenue Days
Fourth Quarter, 2007 Investor Presentation Trading Revenue (TEB) Distribution Frequency Distribution of Daily Trading Revenue (TEB) for Q4/2007 16 14 Trading Revenue Days 12 10 8 6 4 2 0 (10) (8) (6) (4) (2) 0 2 4 6 8 10 12 14 16 18 20+ (C$ MM) 55 Tier 1 Ratio Movement in Q4 0.71% (0.26%) (0.19%) (0
Slide 29: Topical Risk Issues
Fourth Quarter, 2007 Investor Presentation Topical Risk Issues As at October 31, 2007 Direct U.S. Subprime Mortgage Exposure • None Unhedged U.S. Subprime Mortgage • See Slide 51 Exposure through RMBS and CDOs Hedged U.S. Subprime Mortgage • See Slide 52 Exposure through Derivatives Asset-Backed Com
Slide 30: World Markets Review
Fourth Quarter, 2007 Investor Presentation Fourth Quarter, 2007 World Markets Review Brian Shaw Chairman and Chief Executive Officer, CIBC World Markets Fourth Quarter, 2007 Q&A 30