Home' Trinidad and Tobago Guardian : September 5th 2013 Contents BG6 | NEWS
BUSINESS GUARDIAN www.guardian.co.tt SEPTEMBER 2013 • WEEK ONE
CIBC FirstCaribbean International Bank Ltd lowered
credit losses in the 3Q of 2013, parent company
CIBC said in the release of its financial results
on August 29.
Different from the calendar year, CIBC s fiscal year brought
CIBC said: "Provision for credit losses for the nine months
ended July 31, 2013 was down CA$113 million or 12 per cent
from the same period in 2012. In retail and business banking,
the provision was down mainly due to lower write-offs and
bankruptcies in the cards portfolio, partially offset by the
charge resulting from a revision of estimated loss parameters
In wholesale banking, the provision was down mainly due
to lower losses in the US real estate finance portfolio, partially
offset by higher losses in the exited European leveraged finance
portfolio. In corporate and other, the provision was up mainly
due to the increase in the collective allowance noted above,
partially offset by lower losses in FirstCaribbean International
Bank Ltd (CIBC FirstCaribbean)."
CIBC reported that its net income was CA$890 million,
compared with CA$841 million for the third quarter a year
ago and CA$876 million for the prior quarter. FirstCaribbean
reported net income of US$43.1 million for the nine months
ended July 31, versus US$47.6 million for the same period in
the prior year. Net revenues of US$392.9 million for First-
Caribbean were down US$8.6 million when compared with
the corresponding nine-month period in the prior year.
"This reflects the continued strained economic conditions
in the region," FirstCaribbean chairman Michael Mansoor said
in his review of the results.
"Despite the challenging overall economic environment,
loan loss impairment expenses were down US$20.9 million
reflecting a degree of improvement in this area. Operating
expenses of US$270.2 million were up US$12.5 million due to
higher business taxes and non-credit losses. Total assets of
US$11.7 billion were up 3.7 per cent against the same period
in the prior year," he said.
Core business performance
Parent company CIBC said its retail and business banking
reported net income of CA$638 million for the third quarter,
up CA$44 million or 7 per cent from the same quarter last
year. Excluding items of note, which include a revision of
estimated loss parameters on its unsecured lending portfolios,
CIBC said its net income for this segment was CA$654 mil-
lion, up CA$58 million or 10 per cent from the same quarter
Revenue of CA$2.1 billion was up CA$29 million or one
per cent from the third quarter of 2012, primarily due to
volume growth across most products and higher fees.
During the third quarter of 2013, the Retail and Business
Banking segment continued to make progress against CIBC s
objectives of "accelerating profitable revenue growth and
enhancing the client experience." CIBC said: "We continued
our leadership position in mobile innovations by reaching
one million active clients using CIBC s award-winning mobile
banking App, which allows clients to perform many of their
everyday banking transactions from their mobile device."
CIBC said it received three awards in Canada for innovation
related to the launch of its CIBC Mobile Payment App to
help meet more of its clients needs. The awards were the
Gold Award for a Canadian Innovation Benefiting Consumers;
the Gold Award for a Canadian Innovation Benefiting Mer-
chants; and the 2013 People s Choice Award.
CIBC said it "achieved a significant milestone in our dis-
tribution network expansion programme with the opening
of our 150th branch since 2008. As part of the largest branch
development in our history, we have hired more than 1,000
full-time equivalent employees to staff the 150 new, relocated
or expanded locations, and installed close to 500 new ABMs
to better serve our clients."
CIBC s wealth management business segment reported
net income of CA$102 million for the third quarter, up CA$26
million or 34 per cent from the same quarter last year.
The bank said revenue for this segment in 3Q 2013 was
CA$458 million, up CA$57 million or 14 per cent compared
to the third quarter of 2012, primarily due to higher client
assets under management driven by market appreciation
and higher net sales of long-term mutual funds, higher con-
tribution from CIBC s investment in American Century
Investments, and higher fee-based and commission rev-
During the third quarter of 2013, wealth management
continued its progress in support of CIBC s strategic priority
to build its own wealth management platform.
"We achieved our 18th consecutive quarter of retail net
sales of long-term mutual funds and a year-to-date record
of CA$4.6 billion; and we are on track with our transition
plans for the acquisition of Atlantic Trust Private Wealth
Management, announced in the second quarter, which we
expect to complete in early fiscal 2014 following regulatory
approvals," the bank said.
Here in the Caribbean, effective January 1, 2012, the group
implemented the new organisational structure that introduced
the new business segment "wealth management" and in
August 2013, renamed corporate lending and investment
banking to "wholesale banking."
Wholesale banking at the parent company reported net
income of CA$217 million for the third quarter, up CA$19
million or ten per cent from the prior quarter. The bank said
that "excluding items of note, adjusted net income was
CA$223 million, up CA$30 million or 16 per cent from the
prior quarter. CIBC said wholesale banking revenue of CA$596
million was up CA$16 million or three per cent from the
prior quarter, primarily due to higher corporate credit products
and debt issuance revenue, partially offset by losses in the
structured credit run-off business compared to revenue in
the prior quarter, and lower revenue in US real estate finance.
"In support of its objective to be the premier client-
focused wholesale bank centred in Canada," CIBC said its
wholesale banking segment acted as:
- Lender in the financing of Hyundai Capital America s
US$2.7 billion three-year senior unsecured revolver;
- Financial adviser to Brookfield on the sale of Longview
Timber to Weyerhauser for CA$2.7 billion;
- Joint bookrunner on OMERS Realty Corporation s two
bond transactions for a total of CA$1.4 billion;
- Joint bookrunner on Choice Properties REIT s CA$460
million initial public offering of Trust Units, CA$600 million
inaugural bond offering and $500 million senior unsecured
- Joint bookrunner on Enbridge Inc. s CA$600 million
preferred share offering;
- Financial adviser to Manitoba Telecom Services Inc
(MTS) on the sale of its Allstream subsidiary to Accelero
Capital for CA$504 million; and
- Sole agent for the Province of Alberta s CA$500 million
reopening of the Province s 2.9 per cent Medium Term
Notes due September 20, 2029.
Gerald T McCaughey, president and chief executive officer
of CIBC, said: "The investments we are making in our retail
and business banking, wealth management and wholesale
banking businesses are furthering our strength and positioning
us well for the future."
lowers credit losses
Links Archive September 4th 2013 September 6th 2013 Navigation Previous Page Next Page