Stockwatch – Strong performance at the bank’s capital markets division was the main driver in boosting the bottom line.
Stockwatch – Canadian Imperial Bank of Commerce (TSE:CM, Mkt cap 41.89B, P/E 13.38, Div/yield 1.00/3.79, EPS 7.89, Shares 396.97M) has announced an encouraging 5% rise in profit in the third quarter, in comparison with the same period last year.
CIBC, Canada’s fifth-largest lender, saw its net income increase to $921 million from $878 million a year ago, which equates to $2.26 per share. The figures were better than forecasted by analysts, the report added.
Strong performance at the bank’s capital markets division was the main driver in boosting the bottom line, with profit at the wholesale banking unit rising 32% to $282 million, attributed to strong underwriting activity.
Gerald McCaughey, CIBC’s chief executive officer, praised the bank’s “solid” results, adding that they show the strength of its retail and wholesale banking franchises and durable wealth management platform.
The retail and business banking arm did in fact show a 4% drop in net income to $589 million. However, the Globe and Mail reported that the figure alone doesn’t tell the whole story, as the bank recently sold half of its Aeroplan credit card portfolio. Factoring this in, the division’s net income actually increased by 4% in the period.
Profit at the bank’s wealth management arm rose to $121 million, a 19% leap compared to the same three-month period a year ago. The unit accounted for 13% of total profit for the quarter, as CIBC continues to expand this area of its business.
McCaughey said the Toronto-based bank will continue to strive to be the leading bank for its clients. “Our clear focus on client service coupled with our strategic growth initiatives underpins our ability to deliver consistent and sustainable earnings,” he added.
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