CIBC Quarterly Profit Drops With Rise in Provision for Credit Losses
By Robb M. Stewart
Canadian Imperial Bank of Commerce's fiscal third-quarter earnings fell, dented by a rise in provisions for credit losses in what the bank said was a more challenging economic environment.
CIBC, the last of the country's big banks to turn in financial results for the quarter, logged net income of 1.43 billion Canadian dollars ($1.06 billion), or C$1.47 a share, for the three months to July 31, against C$1.67 billion, or $1.78, a year earlier.
The results for the quarter were dented by C$25 million for a commodity tax, plus $23 million in amortization of acquisition-related intangible assets, the bank said.
On an adjusted basis, the big Canadian bank reported earnings of C$1.52 a share, missing the C$1.68 mean estimate of analysts polled by FactSet.
Overall revenue for the quarter rose 5% on-year to C$5.85 billion, broadly in line with the C$5.8 billion analysts were expecting.
Income from CIBC's Canadian personal and business banking operations was down from last year, which it said was mainly due to a higher provision for credit losses and lower card fees. Income was also lower for Canadian commercial banking and wealth management, with a higher provision for credit losses and fell in its U.S. commercial banking and wealth-management arm, but rose for the bank's capital markets division, due to higher revenue
CIBC's provision for credit losses was C$736 million, C$493 million wider than a year ago, due to a shift in the economic outlook and higher impairments across all of the bank's strategic business units.
The bank's common equity Tier 1 capital ratio stood at 12.2% for the quarter, compared with 11.9% at the end of the previous three months.
Write to Robb M. Stewart at robb.stewart@wsj.com
(END) Dow Jones Newswires
August 31, 2023 06:32 ET (10:32 GMT)
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