Canadian Imperial Bank Of Commerce · TSX:CM
Canadian Imperial Bank Of Commerce — CIBC — Q2 2019 Earnings Presentation
27 slides from Canadian Imperial Bank Of Commerce's earnings presentation, May 22, 2019
Slide 1: CIBC Investor Presentation Q2 F19
CIBC Investor Presentation Q2 F19 May 22, 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: Second Quarter, 2019 Financial Review
Second Quarter, 2019 Financial Review Kevin Glass Senior Executive Vice-President and Chief Financial Officer
Slide 5: Second Quarter, 2019 Highlights
5 Second Quarter, 2019 Highlights Adjusted1 Q2/18 Q1/19 Q2/19 Earnings1 ($MM, except for EPS, Efficiency Ratio, ROE, and CET1 Ratio) • Pre-Provision Earnings growth of 4% YoY Revenue 4,361 4,552 4,536 • ROE of 15.9% Non-Interest Expenses 2,467 2,501 2,570 Revenue Pre-Provision Earnings 1,894 2,051 1
Slide 6: Capital
6 Capital CET1 Ratio 31 bps 2 bps 11.2% (35) bps 11.2% Q1/19 Earnings net of RWAs Other Q2/19 Dividends (excl. FX) • Strong internal capital generation Offset by: • RWA increase driven by business growth
Slide 7: Canadian Personal and Small Business Banking
7 Canadian Personal and Small Business Banking NIM expansion and volume growth driving performance Adjusted1 Q2/18 Q1/19 Q2/19 • Revenue growth driven by strong margins ($MM) and volume growth Revenue 2,090 2,166 2,128 − NIM up 9 bps YoY and 5 bps QoQ Non-Interest Expenses 1,089 1,098 1,120 − Deposi
Slide 8: Canadian Commercial Banking and Wealth Management
Canadian Commercial Banking and 8 Wealth Management Profitable results driven by strong volume growth and expense management 1 Adjusted Q2/18 Q1/19 Q2/19 • Strong results in Commercial Banking ($MM) driven by higher fee income and volume Commercial Banking 359 413 408 growth Wealth Management 578 57
Slide 9: U.S. Commercial Banking and Wealth Management
U.S. Commercial Banking and 9 Wealth Management Strong results reflecting solid business performance and investments to support growth Adjusted1 Q2/18 Q1/19 Q2/19 • Strong results driven by client acquisition ($MM) and deepening relationships Commercial Banking 274 321 320 • Expenses reflect investm
Slide 10: Capital Markets
10 Capital Markets Strong performance through focus on diversification and connectivity 1 Adjusted Q2/18 Q1/19 Q2/19 • 12% NIAT growth YoY: ($MM) − Strong revenues across trading, Global Markets 409 414 427 origination and lending businesses Corporate & Investment Banking2 301 291 324 − Positive ope
Slide 11: Corporate and Other
11 Corporate and Other Adjusted1 Q2/18 Q1/19 Q2/19 • Strong revenue growth in CIBC ($MM) FirstCaribbean International Banking 185 197 199 • Lower Treasury revenue Other 25 26 (14) Revenue2 210 223 185 • Expense growth reflecting strategic Non-Interest Expenses 256 268 293 investments Pre-Provision E
Slide 12: Second Quarter, 2019 Risk Review
Second 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 Q2/18 Q1/19 Q2/19 Provision for Credit Losses down QoQ ($MM) • Overall credit quality remains positive Canadian Personal & Small Business Banking 199 192 202 • The outlook, combined with stage Canadian Commercial Banking & Wealth 1 48 25 migration, resulted in
Slide 14: Credit Quality — Gross Impaired Loans
14 Credit Quality — Gross Impaired Loans Reported Q2/18 Q1/19 Q2/19 Gross Impaired Loans up QoQ Canadian Residential Mortgages 0.25% 0.27% 0.27% • Primarily due to funding of a previously Canadian Personal Lending 0.32% 0.34% 0.34% impaired commitment in the utility CIBC Business & Government Loans1
Slide 15: Credit Quality — Canadian Consumer Net Write-offs
Credit Quality — Canadian Consumer 15 Net Write-offs Reported Q2/18 Q1/19 Q2/19 • Credit cards up due to seasonality Canadian Residential Mortgages 0.01% 0.01% 0.01% Canadian Credit Cards 3.41% 3.02% 3.48% Canadian Personal Lending 0.75% 0.76% 0.82% Total 0.29% 0.27% 0.30% Net Write-off Ratio 0.29%
Slide 16: Credit Quality — Canadian Personal Banking Delinquencies
Credit Quality — Canadian Personal Banking 16 Delinquencies 90+ Days Delinquency Rates Q2/18 Q1/19 Q2/19 90+ Days Delinquency rates flat QoQ Residential Mortgages 0.25% 0.27% 0.27% • Stable across all Canadian consumer Uninsured 0.20% 0.21% 0.21% portfolios Insured 0.32% 0.37% 0.37% Credit Cards 0.9
Slide 17: Appendix
Appendix
Slide 18: Canadian Personal Banking Digital Transformation
Canadian Personal Banking Digital 18 Transformation1 Digital Adoption Rate2 Active Mobile Users3 (Millions) 4.4% 29.2% 66.2% 67.7% 2.7 63.3% 2.4 2.1 Q2/17 Q2/18 Q2/19 Q2/17 Q2/18 Q2/19 Banking Centres Self-Serve Transactions4 (%) -4.9% 3.5% 1,096 1,067 88.8% 1,042 87.1% 85.3% Q2/17 Q2/18 Q2/19 Q2/17
Slide 19: Canadian Personal and Small Business Banking Market Share
Canadian Personal and Small Business 19 Banking Market Share Q2/19 Balances YoY Most Current Absolute YoY Growth ($B) Growth Market Share1 Rank Rank2 Money-In Personal Deposits & GICs 155 6.8% 16.8% 4 4 Canadian Retail Mutual Fund and ETF AUM 107 4.2% 13.3% 5 6 Small Business Deposits & GICs 23 6.3%
Slide 20: Oil & Gas Retail Exposure
20 Oil & Gas Retail Exposure Retail Exposure1 in Oil Provinces ($B) • $40.7B of retail exposure1 to oil provinces2 (or $23.4B excluding insured mortgages) − Alberta accounts for $32.3B or 79% of the retail exposure1 41.2 41.2 41.1 40.8 40.7 − Average LTV3 of 67% in the uninsured mortgage portfolio Q
Slide 21: Canadian Real Estate Secured Personal Lending
21 Canadian Real Estate Secured Personal Lending 90+ Days Delinquency Rates Q2/18 Q1/19 Q2/19 • Delinquency rates remained flat in Total Mortgages 0.25% 0.27% 0.27% Q2/19 Uninsured Mortgages 0.20% 0.21% 0.21% • The Greater Vancouver Area1 (GVA) and 1 Uninsured Mortgages in GVA 0.10% 0.10% 0.12% Grea
Slide 22: Canadian Uninsured Residential Mortgages — Q2/19 Originations
Canadian Uninsured Residential Mortgages — 22 Q2/19 Originations Beacon Distribution • Originations of $6B in Q2/19 • Average LTV1 in Canada: 65% 38%36% 34% 34% 31%33% − GVA2: 58% − GTA2: 62% 17% 14%16% 9% 10%10% 6% 7% 5% ≤650 651-700 701-750 751-800 >800 2 Canada GVA GTA 2 Loan-to-Value (LTV)1 Dist
Slide 23: Canadian Uninsured Residential Mortgages
23 Canadian Uninsured Residential Mortgages Beacon Distribution • Better current Beacon and LTV1 distributions in GVA2 and GTA2 than the 42%41% 39% Canadian average 27% 27% • 1% of this portfolio has a Beacon score of 24% 650 or lower and an LTV1 over 75% 13%12%13% 14%16%13% • Average LTV1 in Canada
Slide 24: Trading Revenue (TEB) Distribution
24 Trading Revenue (TEB)1 Distribution2 ($MM) ($MM) 20 20 15 15 10 10 5 5 0 0 (5) (5) (10) Feb-19 Mar-19 Apr-19 (10) Trading Revenue (TEB) VaR 1 Non-GAAP financial measure. See slide 27 for further details. 2 Trading revenue (TEB) comprises both trading net interest income and non-interest income an
Slide 25: Reported Results ($MM)
25 Reported Results ($MM) Total Bank Q2/18 Q1/19 Q2/19 Canadian Personal & Small Business Banking Q2/18 Q1/19 Q2/19 Revenue 4,376 4,565 4,542 Revenue 2,090 2,166 2,128 Non-Interest Expenses 2,517 2,760 2,588 Non-Interest Expenses 1,092 1,327 1,122 Pre-Provision Earnings 1,859 1,805 1,954 Pre-Provisi
Slide 26: Q2 2019 Items of Note
26 Q2 2019 Items of Note After-Tax Pre-Tax EPS & NCI Reporting Effect Effect Effect Segments ($MM) ($/Share) ($MM) Canadian Personal & Small Business Banking/ Amortization of acquisition-related 27 20 0.04 U.S. Commercial Banking & Wealth Management/ intangible assets Corporate & Other Purchase acco
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