Canadian Imperial Bank Of Commerce · TSX:CM
Canadian Imperial Bank Of Commerce — Investor Presentation (June 2013)
36 slides from Canadian Imperial Bank Of Commerce's investor presentation, June 2013
Slide 1: An Investment Community Introduction to CIBC
An Investment Community Introduction to CIBC June 2013
Slide 2: A Note about 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 presentation, in other filings with Canadian securities regulators or the U.S. Securities and Exchange Commission and in othe
Slide 3: Contents
Contents Canadian Economy and Banking System CIBC Corporate Overview CIBC Core Businesses Overview Retail and Business Banking Wealth Management Wholesale Banking 3
Slide 4: Canadian Economy
Canadian Economy Balanced budget for 11 Canadian Federal Budget Balance(2)($B) consecutive years (1998 to 2008) Projections and on track to eliminate deficit 2.1 9.5 13.8 1.7 3.4 by fiscal year 2017 -1.8 -8.6 -16.5 -26.2 -26.0 -33.4 Strong record of economic growth 2004 2006 2008 2010 2012 2013
Slide 5: Canadian Banking System
Canadian Banking System Strong regulator (OSFI) with a Canadian Banks Common Equity Tier 1 Ratio clear mandate (safety and 9.7% soundness) 8.9% Canadian banks weathered the global recession very well (no systemic support and no dividend cuts) CIBC Average (excluding CIBC) 10-year Bank Returns
Slide 6: Contents
Contents Canadian Economy and Banking System CIBC Corporate Overview CIBC Core Businesses Overview Retail and Business banking Wealth Management Wholesale Banking 6
Slide 7: About CIBC
About CIBC CIBC (CM: TSX; NYSE) Canadian-based global financial institution Senior Deposit Ratings Three major operating groups: Moody’s Aa3 Retail and Business Banking S&P A+ Wealth Management Fitch AA- Wholesale Banking 43,057 employees DBRS AA 11 million individual, small business,
Slide 8: CIBC's Balanced Scorecard
CIBC’s Balanced Scorecard Our key measures of Our Objectives 2012 results performance Adjusted Earnings per Adjusted EPS growth of 5%-10% per annum, on share (EPS)(1) growth average, over the next 3-5 years $8.07, up 6.6% from 2011 Return on common Return on average common equity of 20% through the
Slide 9: Earnings per Share
Earnings per Share Adjusted 8.88 8.07 6.83 7.57 6.90 6.45 5.54 5.78 5.88 2.15 2.12 Reported 9.3 7.49 7.85 6.71 5.57 5.95 2.73 2.12 1.91 -0.44 -5.8 2004 2005 2006 2007 2008 2009 2010 2011 2012 Q113 Q213 Canadian GAAP IFRS Diluted, cash basis. Non-GAAP measures. See slides 30-36. 9
Slide 10: Return on Equity
Return on Equity Adjusted 27.3% 25.7% 24.8% 22.3% 22.6% 22.4% 22.3% 20.1% 20.6% 21.1% 18.6% Reported 27.9% 28.7% 22.2% 22.0% 22.3% 18.7% 19.4% 19.9% 9.4% -1.6% -19.4% 2004 2005 2006 2007 2008 2009 2010 2011 2012 Q113 Q213 Canadian GAAP IFRS Adjusted Return on Equity is a non-GAAP measure. See slides
Slide 11: Total Shareholder Return
Total Shareholder Return 32.4% 29.0% 25.6% 20.2% 21.1% 9.8% 7.1% 1.3% 0.4% -2.0% -43.5% 2004 2005 2006 2007 2008 2009 2010 2011 2012 Q113 Q213 Rank #1 #5 #1 #1 #5 #3 #1 #3 #3 #4 #5 Fiscal year. Rank among big 5 Canadian banks (BMO, BNS, CM, RY, TD). 11
Slide 12: Industry Recognition
Industry Recognition One of Canada's 10 Most Admired Corporate Cultures Deal of the Year for our equity investment in American Century Investments 12
Slide 13: Contents
Contents Canadian Economy and Banking System CIBC Corporate Overview CIBC Core Businesses Overview Retail and Business Banking Wealth Management Wholesale Banking 13
Slide 14: Retail and Business Banking Business Overview
Retail and Business Banking Business Overview CIBC Retail and Business Banking Personal Banking Business Banking Deposits Deposits – Chequing – Cash Management – Savings – GICs – GICs Lending Lending – Mortgages – Mortgages – Lines/Loans – Credit Cards – Asset-Based – Lines/Loans Lending 14
Slide 15: Retail and Business Banking Strategic Framework
Retail and Business Banking Strategic Framework Accelerate Profitable Revenue Growth Objective + Enhance Client Experience Shift from a Product to a Paradigm Shift Client-Centric Focus Deepen Client Relationships Priorities Sell Improve Sales & Acquire & Retain Service Clients Capabilities Serve Gro
Slide 16: Retail and Business Banking Balances & Market Share
Retail and Business Banking Balances & Market Share Balances Market Share (%) (1) (2) (2) ($B) Q2/12 Q1/13 Q2/13 (3) Cards 14.7 18.4 17.5 17.4 (3) CIBC Brand Mortgages 98.5 8.2 8.5 8.5 CIBC Brand Personal Lending 30.4 7.0 6.9 6.9 CIBC Brand Personal Deposits & GICs 85.3 10.8 10.7 10.7 (5) (5) Busine
Slide 17: Strength in Retail & Business Banking
Strength in Retail & Business Banking 3rd largest branch network in Canada - significant branch expansion over past 5 years – opened nearly 150 new, relocated or expanded branches Evening and Saturday hours at over 650 branches Sunday hours at over 100 branches 1st to market in Canada: Sunda
Slide 18: Retail and Business Banking Revenue and Profitability
Retail and Business Banking Revenue and Profitability Revenue ($MM) Net Income ($MM)1 Q2 2012 Q1 2013 Q2 2013 Q2 2012 Q1 2013 Q2 2013 (1) Non-GAAP measures which excludes items of note as referenced in our quarterly Report to Shareholders. 18
Slide 19: Contents
Contents Canadian Economy and Banking System CIBC Corporate Overview CIBC Core Businesses Overview Retail and Business Banking Wealth Management Wholesale Banking 19
Slide 20: Wealth Management Business Overview
Wealth Management Business Overview Wealth Management Retail Brokerage – Full-Service Brokerage – Self-Directed Brokerage Asset Management – Investment Management – Mutual Funds – Portfolio Products – Institutional Money Management – International Asset Management Private Wealth Management – Priv
Slide 21: Wealth Management Strategic Priorities
Wealth Management Strategic Priorities Strategic Priorities Attract and Deepen Seek New Sources Pursue Acquisitions/ Client Relationships of Domestic Assets Investments • Elevate channel • Profitable recruitment of • Build scale in asset productivity Investment Advisors management • Enhance discreti
Slide 22: Wealth Management Revenue and Profitability
Wealth Management Revenue and Profitability Revenue ($MM) 1 Net Income ($MM) 1 432 443 90 93 418 80 Q2 2012 Q1 2013 Q2 2013 Q2 2012 Q1 2013 Q2 2013 (1) Non-GAAP measures which excludes items of note as referenced in our quarterly Report to Shareholders. 22
Slide 23: Wealth Management
Wealth Management Wood Gundy Balances ($B) Mutual Fund Balances ($B) 115.9 121.5 63.3 55.1 #2 #4 Market Market Position1 Position1 Q2 2012 Q2 2013 Q2 2012 Q2 2013 WM Revenue ($MM)2 WM Net Income ($MM)2 1,636 1,637 305 280 FY 2011 FY 2012 FY 2011 FY 2012 1 Industry ranking for Wood Gundy is as at Mar
Slide 24: Contents
Contents Canadian Economy and Banking System CIBC Corporate Overview CIBC Core Businesses Overview Retail and Business Banking Wealth Management Wholesale Banking 24
Slide 25: Wholesale Banking Business Overview
Wholesale Banking Business Overview Wholesale Banking Global Global Global Capital Markets Investment Banking1 Corporate Banking1 Debt & Equity Debt & Equity Corporate Cash Underwriting Underwriting Management Commodities Mergers and Corporate Lending Acquisitions (M&A) and Syndicated Lo
Slide 26: Wholesale Banking Strategy and Priorities
Wholesale Banking Strategy and Priorities Bring Canadian Capital Markets products to Canada and Mission the rest of the world, and bring the world to Canada Be the premier client-focused wholesale bank centered in Canada with a reputation for consistent and sustainable Objective earnings, for risk-c
Slide 27: Wholesale Banking
Wholesale Banking Revenue (TEB, $MM)1 Net Income ($MM)1 200 193 557 551 492 154 Q2 2012 Q1 2013 Q2 2013 Q2 2012 Q1 2013 Q2 2013 (1) Non-GAAP measures which excludes items of note as referenced in our quarterly Report to Shareholders. 27
Slide 28: Wholesale Banking Supporting Growth
Wholesale Banking Supporting Growth Strategic Focus Areas Core Canadian businesses Energy Infrastructure and Power & Utilities Mining Real Estate Finance Investing in technology and talent 28
Slide 29: Notes to Users
Notes to Users Performance measurement We use a number of financial measures to assess the performance of our business lines. Some measures are calculated in accordance with GAAP, while other measures do not have a standardized meaning under GAAP, and, accordingly, these measures may not be comparab
Slide 30: Reconciliation of GAAP to Non-GAAP measures
Reconciliation of GAAP to Non-GAAP measures CIBC CIBC Net Income EPS ($MM) ($) 2003 Reported 1,950 5.22 Business interruption insurance recovery (11) (0.03) Gains on Oppenheimer sale (32) (0.09) Interest income from overpayment of income taxes (18) (0.05) Loss on loans held for sale 152 0.42 Reversa
Slide 31: Reconciliation of GAAP to Non-GAAP measures
Reconciliation of GAAP to Non-GAAP measures CIBC CIBC Net Income EPS ($MM) ($) 2005 Reported (32) (0.44) Higher than normal merchant banking gains (319) (0.93) Capital repatriation 7 0.02 Gain on ACE Aviation shares (22) (0.06) Gain on sale of Juniper (64) (0.19) Interest expense re. U.S. Tax settle
Slide 32: Reconciliation of GAAP to Non-GAAP measures
Reconciliation of GAAP to Non-GAAP measures CIBC CIBC Net Income EPS ($MM) ($) 2006 Reported 2,646 7.49 Acct'g adjustment re. mortgage loan prepayment fees 7 0.02 Interest expense re. U.S. Tax settlement 12 0.04 Mark-to-market on credit derivative portfolio 9 0.02 Reversal of general loan loss provi
Slide 33: Reconciliation of GAAP to Non-GAAP measures
Reconciliation of GAAP to Non-GAAP measures 2008 2009 CIBC CIBC CIBC CIBC Net Income EPS Net Income EPS ($MM) ($) ($MM) ($) Reported (2,060) (5.80) 1,174 2.73 Structured credit run-off 4,836 13.01 684 1.80 Mark-to-market on corporate loan hedging (278) (0.75) 182 0.46 Valuation charges 156 0.42 106
Slide 34: Reconciliation of GAAP to Non-GAAP measures
Reconciliation of GAAP to Non-GAAP measures CIBC CIBC Net Income EPS ($MM) ($) 2010 Reported 2,452 5.95 Structured credit run-off 161 0.41 Foreign exchange gains on repatriation activities 117 0.30 Mark-to-market on corporate loan hedging 12 0.03 Reversal of interest expense re. tax audits (17) (0.0
Slide 35: Reconciliation of GAAP to Non-GAAP measures
Reconciliation of GAAP to Non-GAAP measures CIBC CIBC Net Income EPS ($MM) ($) 2012 Reported net income attributable to diluted common shareholders 3,173 7.85 (Revenue)/Loss re. Structured Credit (Wholesale Bkng) 15 0.04 Loan losses in the exited U.S. leveraged finance portfolio (Wholesale Bkng) 32
Slide 36: Reconciliation of GAAP to Non-GAAP measures
Reconciliation of GAAP to Non-GAAP measures CIBC CIBC Net Income EPS ($MM) ($) Q1 2013 Reported net income attributable to diluted common shareholders 771 1.91 (Gain)/Loss re. Structured Credit (Wholesale Bkng) 109 0.27 Gain on sale of our Hong Kong and Singapore-based private wealth management busi
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