Canadian Imperial Bank Of Commerce · TSX:CM

Canadian Imperial Bank Of Commerce — CIBC — Q1 2005 Earnings Presentation

39 slides from Canadian Imperial Bank Of Commerce's earnings presentation, Feb 24, 2005

  1. Slide 1: First Quarter 2005 Investor Presentation

    First Quarter, 2005 Investor Presentation CIBC First Quarter Investor Presentation February 24, 2005 CIBC Overview John S. Hunkin Chief Executive Officer Gerry McCaughey President and Chief Operating Officer 1

  2. Slide 2: Financial Review: Q1 Summary

    First Quarter, 2005 Investor Presentation First Quarter, 2005 Financial Review Tom Woods Senior Executive Vice-President and Chief Financial Officer All financial results are in Canadian dollars on a “REPORTED” basis unless otherwise stated. Q1 Summary $ Per Share EPS(1): $1.94 – Includes gains on a

  3. Slide 3: Quarterly Income Statement

    First Quarter, 2005 Investor Presentation CIBC – Quarterly Income Statement F ‘04 F ‘05 ($MM) Q1 Q2 Q3 Q4 Q1 (1) Revenue 2,941 3,027 2,906 2,901 3,079 (2) Non-Interest Expenses 1,943 2,074 1,968 2,266 1,901 Operating Income 998 953 938 635 1,178 (3) (4) Provision for Credit Losses 155 207 91 175 178

  4. Slide 4: Expenses

    First Quarter, 2005 Investor Presentation CIBC Expenses ($MM) Q3/04 Q4/04 Q1/05 Change Employee Comp. and Benefits 1,060 1,042 1,054 12 Occupancy Costs 156 180 159 (21) •Q4 included sub- lease losses Computer and Office Equip. 279 309 271 (38) •Lower project spending Communications 84 84 86 2 Advert

  5. Slide 5: Retail Markets - Revenue

    First Quarter, 2005 Investor Presentation CIBC Retail Markets – Revenue ($MM) 1,455 1,325 1,325 1,327 1,240 Q1 Q2 Q3 Q4 Q1 F ‘04 F ‘05 9 CIBC Retail Markets – Revenue Components F ‘04 F ‘05 ($MM) Q1 Q2 Q3 Q4 Q1 Personal Banking 497 492 527 545 551 Small Business Banking 143 140 145 146 151 (1) Cards

  6. Slide 6: Retail Markets - Revenue Components

    First Quarter, 2005 Investor Presentation CIBC Retail Markets – Revenue Components F ‘04 F ‘05 ($MM) Q1 Q2 Q3 Q4 Q1 Personal Banking Personal Banking 497 492 527 545 551 + deposit and loan spreads up vs. Q4 Small Business Banking 143 140 145 146 151 – product mix Cards 347 333 347 357 383 (1) Mortga

  7. Slide 7: Retail Markets - Revenue Components

    First Quarter, 2005 Investor Presentation CIBC Retail Markets – Revenue Components F ‘04 F ‘05 ($MM) Q1 Q2 Q3 Q4 Q1 Cards Personal Banking 497 492 527 545 551 + gain on sale of ACE Aviation Holdings Inc. Small Business Banking 143 140 145 146 151 shares(1) + balances up (seasonal) Cards 347 333 347

  8. Slide 8: Retail Markets - Revenue Components

    First Quarter, 2005 Investor Presentation CIBC Retail Markets – Revenue Components F ‘04 F ‘05 ($MM) Q1 Q2 Q3 Q4 Q1 Other Revenue Personal Banking 497 492 527 545 551 + $85MM gain on sale of Republic Bank shares Small Business Banking 143 140 145 146 151 + higher than normal Insurance revenue Cards

  9. Slide 9: Wealth Management - Revenue

    First Quarter, 2005 Investor Presentation CIBC Wealth Management - Revenue ($MM) 623 650 653 609 612 Q1 Q2 Q3 Q4 Q1 F ‘04 F ‘05 17 CIBC Wealth Management - Revenue Components F ‘04 F ‘05 ($MM) Q1 Q2 Q3 Q4 Q1 Imperial Service 188 187 195 195 200 Retail Brokerage 258 294 233 251 277 Private Wealth Man

  10. Slide 10: Wealth Management - Revenue Components

    First Quarter, 2005 Investor Presentation CIBC Wealth Management - Revenue Components F ‘04 F ‘05 ($MM) Q1 Q2 Q3 Q4 Q1 Imperial Service Imperial Service 188 187 195 195 200 + growth in funds managed – up 2% vs. Q4 Retail Brokerage 258 294 233 251 277 – up 6% vs. Q1/04 + spreads up Private Wealth Man

  11. Slide 11: Wealth Management - Revenue Components

    First Quarter, 2005 Investor Presentation CIBC Wealth Management - Revenue Components F ‘04 F ‘05 ($MM) Q1 Q2 Q3 Q4 Q1 Private Wealth Imperial Service 188 187 195 195 200 Management + spreads Retail Brokerage 258 294 233 251 277 + transaction revenue Private Wealth Management 35 37 35 34 38 Wealth P

  12. Slide 12: Wealth Management - Revenue Components

    First Quarter, 2005 Investor Presentation CIBC Wealth Management - Revenue Components F ‘04 F ‘05 ($MM) Q1 Q2 Q3 Q4 Q1 Other Revenue Imperial Service 188 187 195 195 200 – lower Treasury revenue Retail Brokerage 258 294 233 251 277 Private Wealth Management 35 37 35 34 38 Wealth Products 119 120 125

  13. Slide 13: World Markets - Revenue

    First Quarter, 2005 Investor Presentation CIBC World Markets – Revenue ($MM) 1,012 858 836 791 749 Q1 Q2 Q3 Q4 Q1 F ‘04 F ‘05 25 CIBC World Markets – Revenue Components F ‘04 F ‘05 ($MM) Q1 Q2 Q3 Q4 Q1 Capital Markets 394 421 321 309 349 Investment Banking & Credit Products 366 442 326 247 296 Merch

  14. Slide 14: World Markets - Revenue Components

    First Quarter, 2005 Investor Presentation CIBC World Markets – Revenue Components F ‘04 F ‘05 ($MM) Q1 Q2 Q3 Q4 Q1 Capital Markets Capital Markets 394 421 321 309 349 + Equities - new issues, arbitrage, agency up Investment Banking & (vs. Q4) Credit Products 366 442 326 247 296 + FX up Merchant Bank

  15. Slide 15: World Markets - Revenue Components

    First Quarter, 2005 Investor Presentation CIBC World Markets – Revenue Components F ‘04 F ‘05 ($MM) Q1 Q2 Q3 Q4 Q1 Merchant Banking Capital Markets 394 421 321 309 349 + divestiture market continues to improve Investment Banking & Credit Products 366 442 326 247 296 – few opportunities in Q1 Merchan

  16. Slide 16: Competitive Balance Sheet Measures

    First Quarter, 2005 Investor Presentation CIBC – Competitive Balance Sheet Measures Net Tier 1 Unrealized General GA as % Impaired ($MM) Ratio Gains Allowance of RWA(1) Loans(2) CIBC 10.5% 762 1,025 0.86% 288 Bank Peer Group(3) 10.7% 478 1,139 0.81% 686 _______________________ (1) General Allowance

  17. Slide 17: Common Share Dividends

    First Quarter, 2005 Investor Presentation Common Share Dividends ($ per share) 0.65 0.60 0.60 0.50 0.50 Q1 Q2 Q3 Q4 Q1 F ‘04 F ‘05 33 CIBC Retail Markets – ROE & Efficiency (NIX) Ratio 55% (1) 44% 43% ROE 31% 36% 60% NIX 57% 57% 55% 53% (2) (3) Q1 Q2 Q3 Q4 Q1 F ‘04 F ‘05 _______________________ (1)

  18. Slide 18: Retail Markets - Mortgages & Cards

    First Quarter, 2005 Investor Presentation CIBC Retail Markets - Mortgages & Cards ($B; spot) 86.0 84.4 Residential 82.1 79.6 Mortgages 77.9 10.3 10.4 9.9 10.1 Card Loans 9.9 Q1 Q2 Q3 Q4 Q1 F ‘04 F ‘05 35 CIBC Retail Markets - Loan Balances (1) ($B; spot) 21.6 21.9 Personal 20.9 20.0 Loans 19.0 11.9

  19. Slide 19: Retail Markets - Market Share

    First Quarter, 2005 Investor Presentation CIBC Retail Markets - Market Share (1)(2) 14.8% 14.8% Residential 14.7% 14.7% 14.7% Mortgages Consumer 19.3% 19.3% 19.2% 19.1% Deposits 19.0% Consumer 15.2% 15.2% 15.0% 14.9% Loans 14.5% * (excl. cards) Q1 Q2 Q3 Q4 Q1 F ‘04 F ‘05 * Decline driven mainly by B

  20. Slide 20: Wealth Management - ROE & Efficiency Ratio

    First Quarter, 2005 Investor Presentation CIBC Wealth Management - ROE & Efficiency (NIX) Ratio 40% 35% 36% 35% (1) 30% ROE 77% 75% NIX 73% 74% 73% Q1 Q2 Q3 Q4 Q1 F ‘04 F ‘05 _______________________ (1) For further details, see Non-GAAP measures within the Notes to users section on page i of the Q1/

  21. Slide 21: Mutual Fund AUM & Market Share

    First Quarter, 2005 Investor Presentation Mutual Fund AUM & Market Share (1) Mutual Fund AUM Canadian Market Share 45 42.2 10.0 39.5 40.7 40.5 40.4 40 9.5 Market Share (%) 35 9.0 30 8.5 8.7 8.7 $ Billions 8.6 8.5 8.4 8.0 25 7.5 20 7.0 15 6.5 10 6.0 5 5.5 5.0 Q1 Q2 Q3 Q4 Q1 F ‘04 F ‘05 ______________

  22. Slide 22: Imperial Service and Discount Brokerage

    First Quarter, 2005 Investor Presentation Imperial Service # IDA Registered Productivity ($MM) Financial Advisers Funds Managed per FA 62.2 63.3 1,075 1,077 1,029 58.7 56.3 887 F ‘02 F ‘03 F ‘04 Q1 F ‘02 F ‘03 F ‘04 Q1 Annual F ‘05 Annual F ‘05 43 Discount Brokerage (1) Active Accounts Trades / Day

  23. Slide 23: Wood Gundy and EPS by Type of Business

    First Quarter, 2005 Investor Presentation CIBC Wood Gundy (1) AUA AUA per Investment Adviser 120 120 105.4 97.3 98.2 97.9 100.6 100 100 80 80 $ Millions $ Billions 76.2 60 68.9 70.0 70.0 71.9 60 40 40 20 20 0 0 Q1 Q2 Q3 Q4 Q1 F ‘04 F ‘05 _______________________ AUA includes client cash and short pos

  24. Slide 24: Retail & Wealth plus Commercial Banking

    First Quarter, 2005 Investor Presentation CIBC Retail & Wealth plus Commercial Banking (1) ($MM) Revenue NIAT F ‘04 F ‘05 F ‘04 F ‘05 Q1 Q4 Q1 Q1 Q4 Q1 CIBC Retail Markets 1,325 1,327 1,455 277 293 364 CIBC Wealth Management 623 612 653 90 100 114 CIBC Retail & Wealth 1,948 1,939 2,108 367 393 478 P

  25. Slide 25: World Markets - ROE & Efficiency Ratio

    First Quarter, 2005 Investor Presentation CIBC World Markets – ROE & Efficiency (NIX) Ratio 40% 45% 33% (1) 28% ROE (7%) 106% NIX (2) (TEB) 66% 64% 69% 69% (3) Q1 Q2 Q3 Q4 Q1 F ‘04 F ‘05 _______________________ (1) For further details, see Non-GAAP measures within the Notes to users sections on page

  26. Slide 26: World Markets - Merchant Banking

    First Quarter, 2005 Investor Presentation CIBC World Markets - Merchant Banking Total Portfolio Industry Diversification (Carrying Value = $1,630MM as at January 31, 2005) Consumer Services 16.3 % Entertainment 5.4 Financial Services 7.8 Hardware & Software 6.8 Healthcare 3.6 Industrial Growth & Ser

  27. Slide 27: Canadian New Equity Issues and Economic Profit

    First Quarter, 2005 Investor Presentation CIBC World Markets – Market Share Canadian New Equity Issues (1) 20 18.4 17.7 16.8 16.2 14.9 Market Share (%) 15 10 5 0 Q1 Q2 Q3 Q4 Q1 _______________________ F ‘04 (2) F ‘05 Source: CIBC Equity Capital Markets. (1) Based on total amount underwritten. (2) F`

  28. Slide 28: Economic Profit and Net Interest Margin

    First Quarter, 2005 Investor Presentation Economic Profit (1) ($MM) F ‘04 F ‘05 Q1 Q2 Q3 Q4 Q1 CIBC Retail Markets 196 118 157 205 280 CIBC Wealth Management 51 60 67 63 78 CIBC World Markets 100 172 181 (103) 108 Corporate and Other 23 (49) (13) 36 50 Total CIBC 370 301 392 201 516 ________________

  29. Slide 29: Other Non-Interest Income

    First Quarter, 2005 Investor Presentation “Other” Non-Interest Income ($MM) F ‘04 F ‘05 Q1 Q2 Q3 Q4 Q1 Gain/(Loss) on Sale of Loans 44 42 30 28 (6) Other Gains/(Losses)(1) 28 38 109 6 23 SAR(2) hedge revenue/(expense) 28 2 (2) 19 (12) Income from equity-accounted (4) investments(3) 21 14 16 9 76 AcG

  30. Slide 30: Risk Review

    First Quarter, 2005 Investor Presentation First Quarter, 2005 Risk Review Wayne Fox Vice Chair and Chief Risk Officer Treasury, Balance Sheet and Risk Management Key Messages Credit Quality • Gross Impaired Loans reduced 16.5% year-over-year • Net Impaired Loans reduced 30.9% year-over-year • Specif

  31. Slide 31: Specific Provision for Credit Losses

    First Quarter, 2005 Investor Presentation Specific Provision for Credit Losses as % of Net Loans and Acceptances 2.50% Consumer Business & Government Expected Total Bank Net Loans and Acceptances (excl. Reverse Repos) 2.00% Total Range: 0.50% - 0.65% (excl. Reverse Repos) Annualized % of 1.50% 1.00%

  32. Slide 32: Consumer Portfolio Specific Provisions

    First Quarter, 2005 Investor Presentation Consumer Portfolio Specific Provisions ($MM) 130 110 Credit Specific provisions 90 Card Loans returning to expected 70 Personal & Student Loans levels following Q4/04. 50 30 Residential 10 Mortgages (10) 1999* 2000* 2001* 2002* 2003* Q1/04 Q2/04 Q3/04 Q4/04

  33. Slide 33: Loan Portfolio Mix

    First Quarter, 2005 Investor Presentation Loan Portfolio Mix (Net Loans and Acceptances - $143.6B*) as at January 31, 2005 - 21.4% - 0.4% + 15.7% $2.6 $24.2 $35.9 $35.7 $20.9 $2.0 Q1/04 Q1/05 Q1/04 Q1/05 Q1/04 Q1/05 + 6.5% Business & Student Loans Gov't Loans -12.3% $73.4 Personal Loans $69.0 1% 25%

  34. Slide 34: Trading Risk and Internal Capital Generation

    First Quarter, 2005 Investor Presentation Trading Risk CIBC Trading Books – Total VaR 25 20 15 $MM 10 5 0 1999 2000 2001 2002 2003 Q1/04 Q2/04 Q3/04 Q4/04 Q1/05 67 Internal Capital Generation (C$MM) Preferred Common Share Net NIAT1 Dividends1 Dividends Repurchases Quarterly Annual 1999 934 (17) (492

  35. Slide 35: Appendix: RWA and Capital Ratio Trends

    First Quarter, 2005 Investor Presentation RWA and Capital Ratio Trends 150 Risk Weighted Assets Tier 1 Capital 14.0% 145 13.0% 140 12.0% 135 11.0% 130 $B 10.0% 125 9.0% 120 115 8.0% 110 7.0% 105 6.0% 1998 1999 2000 2001 2002 2003 Q1/04 Q2/04 Q3/04 Q4/04 Q1/05 69 Appendix 35

  36. Slide 36: Net Loans and Acceptances / Loan Portfolio Mix

    First Quarter, 2005 Investor Presentation Specific Provision for Credit Losses as % of Net Loans and Acceptances 2.50% Total Expected Total Bank Net Loans and Acceptances (excl. Reverse Repos) 2.00% Range: 0.50% - 0.65% Total Annualized % of (incl. Reverse Repos) 1.50% 1.00% 0.50% 0.00% -0.50% * 199

  37. Slide 37: Business & Government Loan Diversification

    First Quarter, 2005 Investor Presentation Business & Government Loan Diversification (Net Loans and Acceptances excl. Reverse Repos - $35.7B*) as at January 31, 2005 Telecommunications Publishing, Printing, & Cable & Broadcasting 2% 1% Hardware & Transportation Education, health Software 4% and soci

  38. Slide 38: Forward-Looking Statements

    First Quarter, 2005 Investor Presentation Q1 Formations (Business & Government - $107MM) New Formations ($MM) New Formations as a % of Loans & Acceptances ** Annualized % of Loans and 700 5.0% 4.5% 600 4.0% Acceptances 500 3.5% 400 3.0% $MM 2.5% 300 2.0% 200 1.5% 1.0% Agriculture 100 38% 0.5% 0 0.0%

  39. Slide 39: Q&A

    First Quarter, 2005 Investor Presentation Q&A 39

CIBC — Q1 2005 Earnings Presentation on 6ix