CIBC Announces Fourth Quarter and Fiscal 2018 Results Français

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CIBC - Investor Relations

Nov 29, 2018, 05:54 ET

CIBC's 2018 audited annual consolidated financial statements and accompanying management's discussion & analysis (MD&A) will be available today at www.cibc.com, along with the supplementary financial information and supplementary regulatory capital reports which include fourth quarter financial information. All amounts are expressed in Canadian dollars, unless otherwise indicated.

TORONTO, Nov. 29, 2018 /CNW/ - CIBC (TSX: CM) (NYSE: CM) today announced its results for the fourth quarter and fiscal year ended October 31, 2018.

"In 2018, CIBC delivered record net income driven by strong performance across all of our strategic business units," says Victor G. Dodig, CIBC President and Chief Executive Officer. "We made excellent progress in continuing to embed a client-focused culture, investing in our cross-border platform and enhancing value for our shareholders. Looking forward, we are well positioned to continue to build a client-focused bank that delivers superior shareholder returns."

Fourth quarter highlights

Q4/18

Q4/17

Q3/18

YoY Variance

QoQ Variance

Reported Net Income

$1,268 million

$1,164 million

$1,369 million

+9%

-7%

Adjusted Net Income(1)

$1,364 million

$1,263 million

$1,399 million

+8%

-3%

Reported Diluted Earnings Per Share (EPS)

$2.80

$2.59

$3.01

+8%

-7%

Adjusted Diluted EPS(1)

$3.00

$2.81

$3.08

+7%

-3%

Reported Return on Common Shareholders' Equity (ROE)

15.3%

15.8%

16.7%

Adjusted ROE(1)

16.4%

17.2%

17.1%

Basel III Common Equity Tier 1 (CET1) Ratio (all-in basis)

11.4%

10.6%

11.3%

(1)

   For additional information, see the "Non-GAAP measures" section.

CIBC's results for the fourth quarter of 2018 were affected by the following items of note aggregating to a negative impact of $0.20 per share:

  • $89 million ($65 million after-tax and minority interest, or $0.15 per share) of incremental losses on debt securities and loans in FirstCaribbean International Bank Limited (CIBC FirstCaribbean) resulting from the Barbados government debt restructuring;
  • $26 million ($19 million after-tax, or $0.04 per share) amortization of acquisition-related intangible assets; and
  • $8 million ($7 million after-tax, or $0.01 per share) in transaction and integration-related costs net of purchase accounting adjustments associated with the acquisitions of The PrivateBank and Geneva Advisors.

For the year ended October 31, 2018, CIBC reported net income of $5.3 billion and adjusted net income(1) of $5.5 billion, compared with reported net income of $4.7 billion and adjusted net income(1) of $4.7 billion for 2017.

The following table summarizes our strong performance in 2018 against our key financial measures and targets:

Financial Measure

Target

2018 Reported Results

2018 Adjusted Results (1)

Diluted EPS growth

5% to 10% on average, annually

$11.65, up 4% from 2017

$12.21, up 10% from 2017

ROE

15% +

16.6%

17.4%

Efficiency ratio

55% by 2019 (2)

57.5%, an improvement of 130 basis points from 2017

55.6%, an improvement of 160 basis points from 2017

Basel III CET1 ratio

Strong buffer to regulatory
minimum

11.4%

Dividend payout ratio

40% to 50%

45.5%

43.4%

Total shareholder return

Outperform the S&P/TSX
Composite Banks Index over a
rolling five-year period

CIBC – 60.6%

S&P/TSX Composite Banks Index – 62.0%

(1)

For additional information, see the "Non-GAAP measures" section.

(2)

CIBC has set a medium-term target of achieving a run rate efficiency ratio of 52% by 2022.

Core business performance

F2018 Financial Highlights

(C$ million)

F2018

F2017

YoY Variance

Canadian Personal and Small Business Banking


Reported Net Income

$2,547

$2,420

up 5%

Adjusted Net Income(1)

$2,556

$2,250

up 14%




Canadian Commercial Banking and Wealth Management


Reported Net Income

$1,307

$1,138

up 15%

Adjusted Net Income(1)

$1,308

$1,139

up 15%




U.S. Commercial Banking and Wealth Management


Reported Net Income

$565

$203

up 178%

Adjusted Net Income(1)

$592

$222

up 167%




Capital Markets


Reported Net Income

$1,069

$1,090

down 2%

Adjusted Net Income(1)

$1,069

$1,090

down 2%

(1)

   For additional information, see the "Non-GAAP measures" section.

Strong fundamentals
While investing in core businesses, CIBC has continued to strengthen key fundamentals. In 2018, CIBC maintained its capital strength, competitive productivity and sound risk management practices:

  • CIBC's capital ratios were strong, with a Basel III CET1 ratio of 11.4% as noted above, and Tier 1 and Total capital ratios of 12.9% and 14.9% respectively, at October 31, 2018;
  • Market risk, as measured by average Value-at-Risk, was $5.3 million in 2018 compared with $6.5 million in 2017; and
  • We continued to have strong credit performance, with CIBC's loan loss ratio of 26 basis points compared with 25 basis points in 2017.

Making a difference in our Communities

CIBC is committed to building a bank that is relevant to our clients, our team members and our communities. During the fourth quarter of 2018:

  • We celebrated 22 years as title sponsor of the Canadian Cancer Society CIBC Run for the Cure and helped raise $16 million, including $3 million contributed by Team CIBC, for breast cancer research and support programs; and
  • We renewed our partnership with the Greater Toronto Airports Authority as official Financial Institution Partner at Toronto Pearson International Airport through October 2023.

Fourth quarter financial highlights




















As at or for the

As at or for the




three months ended

twelve months ended

2018

2018

2017

2018

2017

Unaudited

Oct. 31

Jul. 31

Oct. 31

Oct. 31

Oct. 31

Financial results ($ millions)

Net interest income

$

2,539

$

2,577

$

2,464

$

10,065

$

8,977

Non-interest income

1,913

1,970

1,805


7,769

7,303

Total revenue

4,452

4,547

4,269


17,834

16,280

Provision for credit losses

264

241

229


870

829

Non-interest expenses

2,591

2,572

2,570


10,258

9,571

Income before income taxes

1,597

1,734

1,470


6,706

5,880

Income taxes

329

365

306


1,422

1,162

Net income

$

1,268

$

1,369

$

1,164

$

5,284

$

4,718

Net income attributable to non-controlling interests

2

4

5


17

19

Preferred shareholders

24

23

24


89

52

Common shareholders

1,242

1,342

1,135


5,178

4,647

Net income attributable to equity shareholders

$

1,266

$

1,365

$

1,159

$

5,267

$

4,699

Financial measures















Reported efficiency ratio

58.2

%

56.6

%

60.2

%

57.5

%

58.8

%

Adjusted efficiency ratio (1)

56.2

%

55.0

%

56.5

%

55.6

%

57.2

%

Loan loss ratio  (2)

0.27

%

0.29

%

0.23

%

0.26

%

0.25

%

Reported return on common shareholders' equity

15.3

%

16.7

%

15.8

%

16.6

%

18.3

%

Adjusted return on common shareholders' equity (1)

16.4

%

17.1

%

17.2

%

17.4

%

18.1

%

Net interest margin

1.67

%

1.69

%

1.72

%

1.68

%

1.66

%

Net interest margin on average interest-earning assets


1.86

%

1.89

%

1.92

%

1.88

%

1.85

%

Return on average assets


0.83

%

0.90

%

0.81

%

0.88

%

0.87

%

Return on average interest-earning assets


0.93

%

1.00

%

0.91

%

0.99

%

0.97

%

Total shareholder return

(3.18)

%

7.39

%

6.19

%

4.70

%

18.30

%

Reported effective tax rate

20.6

%

21.0

%

20.8

%

21.2

%

19.8

%

Adjusted effective tax rate (1)

20.7

%

21.1

%

21.8

%

20.0

%

20.3

%

Common share information















Per share ($)

- basic earnings

$

2.81

$

3.02

$

2.60

$

11.69

$

11.26

- reported diluted earnings

2.80

3.01

2.59


11.65

11.24

- adjusted diluted earnings (1)

3.00

3.08

2.81


12.21

11.11

- dividends

1.36

1.33

1.30


5.32

5.08

- book value

73.83

72.41

66.55


73.83

66.55

Share price ($)

- high

124.59

118.72

114.01


124.59

119.86

- low

112.24

112.00

104.10


110.11

97.76

- closing

113.68

118.72

113.56


113.68

113.56

Shares outstanding (thousands)

- weighted-average basic (3)

443,015

444,081

437,109

(4)

443,082

412,636

(4)

- weighted-average diluted

444,504

445,504

438,556

(4)

444,627

413,563

(4)

- end of period (3)

442,826

443,717

439,313

(4)

442,826

439,313

(4)

Market capitalization ($ millions)

$

50,341

$

52,678

$

49,888

$

50,341

$

49,888

Value measures















Dividend yield (based on closing share price)

4.7

%

4.4

%

4.5

%

4.7

%

4.5

%

Reported dividend payout ratio


48.4

%

43.9

%

50.1

%

45.5

%

45.6

%

Adjusted dividend payout ratio (1)

45.1

%

43.0

%

46.1

%

43.4

%

46.2

%

Market value to book value ratio

1.54

1.64

1.71


1.54

1.71

On- and off-balance sheet information ($ millions)















Cash, deposits with banks and securities

$

119,355

$

120,429

$

107,571

$

119,355

$

107,571

Loans and acceptances, net of allowance

381,661

377,310

365,558


381,661

365,558

Total assets

597,099

595,025

565,264


597,099

565,264

Deposits

461,015

459,767

439,706


461,015

439,706

Common shareholders' equity

32,693

32,131

29,238


32,693

29,238

Average assets

603,726

605,220

568,905


598,441

542,365

Average interest-earning assets


540,933

542,140

510,038


536,059

485,837

Average common shareholders' equity

32,200

31,836

28,471


31,184

25,393

Assets under administration (AUA) (5)(6)

2,303,962

2,400,407

2,192,947

2,307,116

2,192,947

Assets under management (AUM) (6)

225,379

232,915

221,571

225,379

221,571

Balance sheet quality (All-in basis) and liquidity measures

















Risk-weighted assets (RWA) ($ millions)
















Common Equity Tier 1 (CET1) capital RWA

$

216,144

$

211,820

$

203,321

$

216,144

$

203,321

Tier 1 capital RWA

216,303

211,968

203,321


216,303

203,321

Total capital RWA

216,462

212,116

203,321


216,462

203,321

Capital ratios
















CET1 ratio

11.4

%

11.3

%

10.6

%

11.4

%

10.6

%

Tier 1 capital ratio

12.9

%

12.8

%

12.1

%

12.9

%

12.1

%

Total capital ratio

14.9

%

14.8

%

13.8

%

14.9

%

13.8

%

Basel III leverage ratio
















Leverage ratio exposure ($ millions)

$

653,946

$

649,169

$

610,353

$

653,946

$

610,353

Leverage ratio

4.3

%

4.2

%

4.0

%

4.3

%

4.0

%

Liquidity coverage ratio (LCR)

128

%

126

%

120

%

n/a

n/a

Other information















Full-time equivalent employees


44,220

45,091

44,928


44,220

44,928

(1)

For additional information, see the "Non-GAAP measures" section.

(2)

The ratio is calculated as the provision for credit losses on impaired loans to average loans and acceptances, net of allowance for credit losses. In 2018, following our adoption of IFRS 9 on November 1, 2017, provision for credit losses on impaired loans (stage 3) is calculated in accordance with IFRS 9. 2017 and prior amounts were calculated in accordance with IAS 39.

(3)

Excludes 60,764 restricted shares as at October 31, 2018 (July 31, 2018: 68,084; October 31, 2017: 190,285).

(4)

Excludes 2,010,890 common that were issued and outstanding but which have not been acquired by a third party as at October 31, 2017. These shares were issued as a component of our acquisition of The PrivateBank.

(5)

Includes the full contract amount of AUA or custody under a 50/50 joint venture between CIBC and The Bank of New York Mellon of $1,834.0 billion (July 31, 2018: $1,915.6 billion; October 31, 2017: $1,723.9 billion).

(6)

AUM amounts are included in the amounts reported under AUA.

n/a

Not applicable.

Review of Canadian Personal and Small Business Banking fourth quarter results












2018

2018

2017

$ millions, for the three months ended

Oct. 31

Jul. 31

Oct. 31

Revenue









Personal and small business banking

$

2,190

$

2,165

$

2,086

Other

11

11

7

Total revenue

2,201

2,176

2,093

Provision for credit losses











Impaired (1)

182

199

181

Performing (1)

9

-

2

Total provision for credit losses

191

199

183

Non-interest expenses

1,100

1,105

1,161

Income before income taxes


910

872

749

Income taxes

242

233

198

Net income

$

668

$

639

$

551

Net income attributable to:









Equity shareholders (a)

$

668

$

639

$

551

Efficiency ratio

50.0

%

50.8

%

55.5

%

Return on equity (2)

68.9

%

66.7

%

57.8

%

Charge for economic capital (2) (b)

$

(95)

$

(94)

$

(93)

Economic profit (2) (a+b)

$

573

$

545

$

458

Full-time equivalent employees

14,086

14,425

14,709

(1)

As a result of our adoption of IFRS 9 effective November 1, 2017, we now recognize provision for credit losses on both impaired and performing loans in the SBU. In prior periods, provision for credit losses on performing loans was recognized in Corporate and Other, with the exception of provision for credit losses on: (i) performing residential mortgages greater than 90 days delinquent; and (ii) performing personal loans and scored small business loans greater than 30 days delinquent, which was recognized in Canadian Personal and Small Business Banking.

(2)

For additional information, see the "Non-GAAP measures" section.

Net income was $668 million, up $117 million from the fourth quarter of 2017. Adjusted net income (2) was $669 million, up $46 million from the fourth quarter of 2017.

Revenue of $2,201 million was up $108 million from the fourth quarter of 2017. Personal and small business banking revenue increased primarily due to favourable spreads, higher volumes and higher fees.

Provision for credit losses of $191 million was up $8 million from the fourth quarter of 2017, mainly due to a higher provision for credit losses on performing loans as a result of portfolio growth in the personal lending portfolio.

Non-interest expenses of $1,100 million were down $61 million from the fourth quarter of 2017, mainly due to fees and charges related to the launch of Simplii Financial and the related wind-down of President's Choice Financial in 2017, shown as an item of note, partially offset by higher spending on strategic initiatives.

Review of Canadian Commercial Banking and Wealth Management fourth quarter results

2018

2018

2017

$ millions, for the three months ended

Oct. 31

Jul. 31

Oct. 31

Revenue









Commercial banking

$

386

$

389

$

348

Wealth management

600

599

574

Total revenue

986

988

922

Provision for (reversal of) credit losses









Impaired (1)

8

2

11

Performing (1)

(1)

(6)

n/a

Total provision for (reversal of) credit loss

7

(4)

11

Non-interest expenses

521

513

520

Income before income taxes


458

479

391

Income taxes

125

129

104

Net income

$

333

$

350

$

287

Net income attributable to:









Equity shareholders (a)

$

333

$

350

$

287

Efficiency ratio

52.8

%

51.9

%

56.4

%

Return on equity  (2)

39.6

%

41.7

%

37.1

%

Charge for economic capital (2) (b)

$

(82)

$

(83)

$

(76)

Economic profit (2) (a+b)

$

251

$

267

$

211

Full-time equivalent employees

4,999

5,060

5,081

(1)

As a result of our adoption of IFRS 9 effective November 1, 2017, we now recognize provision for credit losses on both impaired and performing loans in the SBU. In prior periods, provision for credit losses on performing loans was recognized in Corporate and Other.

(2)

For additional information, see the "Non-GAAP measures" section.

n/a

Not applicable.

Net income for the quarter was $333 million, up $46 million from the fourth quarter of 2017. Adjusted net income(2) was $334 million, up $46 million from the fourth quarter of 2017.

Revenue of $986 million was up $64 million from the fourth quarter of 2017, driven by strong lending and deposit growth in commercial banking, and growth in fee-based revenue in our wealth management businesses.

Provision for credit losses was down $4 million from the fourth quarter of 2017, primarily due to lower losses in the commercial banking portfolio.

Non-interest expenses of $521 million were comparable with the fourth quarter of 2017.

Review of U.S. Commercial Banking and Wealth Management fourth quarter results

2018

2018

2017

$ millions, for the three months ended

Oct. 31

Jul. 31

Oct. 31(1)

Revenue









Commercial banking

$

311

$

304

$

290

Wealth management

148

144

119

Other

(2)

-

13

Total revenue (2)(3)

457

448

422

Provision for (reversal of) credit losses









Impaired (4)

22

28

15

Performing (4)

18

(14)

33

Total provision for credit losses

40

14

48

Non-interest expenses

264

246

235

Income before income taxes


153

188

139

Income taxes (2)

22

26

32

Net income

$

131

$

162

$

107

Net income attributable to:









Equity shareholders (a)

$

131

$

162

$

107

Efficiency ratio

57.6

%

55.0

%

55.7

%

Return on equity  (5)

7.2

%

9.1

%

6.4

%

Charge for economic capital (5) (b)

$

(172)

$

(170)

$

(156)

Economic profit (5) (a+b)

$

(41)

$

(8)

$

(49)

Full-time equivalent employees

1,947

1,926

1,753

(1)

Certain information was reclassified to conform to the funds transfer pricing methodology adopted in the first quarter of 2018 relating to CIBC Bank USA.

(2)

Revenue and income taxes are reported on a taxable equivalent basis (TEB) basis. Accordingly, revenue and income taxes include a TEB adjustment of nil for the quarter ended October 31, 2018 (July 31, 2018: $1 million; October 31, 2017: nil). The equivalent amounts are offset in the revenue and income taxes of Corporate and Other.

(3)

Included $9 million of accretion of the acquisition date fair value discount on the acquired loans of The PrivateBank, shown as an item of note, for the quarter ended October 31, 2018 (July 31, 2018:

$12 million; October 31, 2017: $31 million).

(4)

As a result of our adoption of IFRS 9 effective November 1, 2017, we now recognize provision for credit losses on both impaired and performing loans in the SBU. In prior periods, provision for credit losses on performing loans other than that of CIBC Bank USA was recognized in Corporate and Other.

(5)

For additional information, see the "Non-GAAP measures" section.

Net income for the quarter was $131 million, up $24 million from the fourth quarter of 2017. Adjusted net income(5) was $139 million, up $20 million from the fourth quarter of 2017.

Revenue of $457 million was up $35 million from the fourth quarter of 2017, primarily due to loan growth and margin expansion at CIBC Bank USA.

Provision for credit losses of $40 million was down $8 million from the fourth quarter of 2017. The provision for credit losses on impaired loans was up due to higher losses in CIBC Bank USA. The provision for credit losses on performing loans was down, primarily due to the establishment of a collective allowance (prior to our adoption of IFRS 9) for new loan originations and renewals of acquired loans relating to CIBC Bank USA in the fourth quarter of 2017, shown as an item of note.

Non-interest expenses of $264 million were up $29 million from the fourth quarter of 2017, primarily due to higher spending on growth initiatives.

Review of Capital Markets fourth quarter results

2018

2018

2017

$ millions, for the three months ended

Oct. 31

Jul. 31

Oct. 31

Revenue











Global markets

$

371

$

408

$

299

Corporate and investment banking

281

350

326

Other

(3)

(6)

(3)

Total revenue (1)

649

752

622

Provision for (reversal of) credit losses









Impaired (2)

2

1

-

Performing (2)

(6)

(2)

n/a

Total reversal of credit losses

(4)

(1)

-

Non-interest expenses

356

384

320

Income before income taxes

297

369

302

Income taxes (1)

64

104

80

Net income

$

233

$

265

$

222

Net income attributable to:









Equity shareholders (a)

$

233

$

265

$

222

Efficiency ratio


55.0

%

50.9

%

51.3

%

Return on equity (3)

35.3

%

39.1

%

30.0

%

Charge for economic capital (3) (b)

$

(65)

$

(66)

$

(72)

Economic profit (3) (a+b)

$

168

$

199

$

150

Full-time equivalent employees

1,396

1,416

1,314

(1)

Revenue and income taxes are reported on a TEB basis. Accordingly, revenue and income taxes include a TEB adjustment of $30 million for the quarter ended October 31, 2018 (July 31, 2018: $43 million; October 31, 2017: $37 million). The equivalent amounts are offset in the revenue and income taxes of Corporate and Other.

(2)

As a result of our adoption of IFRS 9 effective November 1, 2017, we now recognize provision for credit losses on both impaired and performing loans in the SBU. In prior periods, provision for credit losses on performing loans was recognized in Corporate and Other.

(3)

For additional information, see the "Non-GAAP measures" section.

n/a

Not applicable.

Net income for the quarter was $233 million, compared with net income of $222 million for the fourth quarter of 2017. Adjusted net income(3) for the quarter was $233 million, compared with $222 million for the prior year quarter.

Revenue of $649 million was up $27 million from the fourth quarter of 2017. In global markets, higher revenue from our equity derivatives, foreign exchange and interest rate trading businesses was partially offset by the movement in reserves related to derivative client exposures. In corporate and investment banking, lower investment portfolio revenue and lower debt underwriting revenue was partially offset by higher corporate banking and advisory revenue.

Reversal of credit losses was $4 million, compared with nil in the fourth quarter of 2017.

Non-interest expenses of $356 million were up $36 million from the fourth quarter of 2017, primarily due to higher performance and employee-related compensation.

Review of Corporate and Other fourth quarter results




2018

2018

2017

$ millions, for the three months ended

Oct. 31

Jul. 31

Oct. 31

Revenue







International banking

$

127

$

172

$

183

Other

32

11

27

Total revenue (1)

159

183

210

Provision for (reversal of) credit losses







Impaired (2)

45

44

5

Performing (2)

(15)

(11)

(18)

Total provision for (reversal of) credit losses

30

33

(13)

Non-interest expenses

350

324

334

Loss before income taxes


(221)

(174)

(111)

Income taxes (1)

(124)

(127)

(108)

Net loss

$

(97)

$

(47)

$

(3)

Net income (loss) attributable to:







Non-controlling interests

$

2

$

4

$

5

Equity shareholders

(99)

(51)

(8)

Full-time equivalent employees

21,792

22,264

22,071

(1)

Revenue and income taxes of Capital Markets and U.S. Commercial Banking and Wealth Management are reported on a TEB basis. The equivalent amounts are offset in the revenue and income taxes of Corporate and Other. Accordingly, revenue and income taxes include a TEB adjustment of $30 million for the quarter ended October 31, 2018 (July 31, 2018: $44 million; October 31, 2017: $37 million).

(2)

As a result of our adoption of IFRS 9 effective November 1, 2017, we now recognize provision for credit losses on both impaired and performing loans in the SBUs. In prior periods, provision for credit losses on performing loans was recognized in Corporate and Other, with the exception of provision for credit losses related to CIBC Bank USA, which was recognized in U.S. Commercial Banking and Wealth Management, and provision for credit losses on: (i) performing residential mortgages greater than 90 days delinquent; and (ii) performing personal loans and scored small business loans greater than 30 days delinquent, which was recognized in Canadian Personal and Small Business Banking. Provision for credit losses related to CIBC FirstCaribbean continues to be recognized in Corporate and Other.

(3)

For additional information, see the "Non-GAAP measures" section.

Net loss for the quarter was $97 million, compared with a net loss of $3 million in the same quarter last year, primarily due to lower revenue, higher credit losses and higher non-interest expenses. Adjusted net loss (3) for the quarter was $11 million, compared with adjusted net income of $11 million for the prior year quarter.

Revenue of $159 million was down $51 million from the fourth quarter of 2017, primarily due to losses recognized on debt securities in CIBC FirstCaribbean as a result of the Barbados government debt restructuring.

Provision for credit losses was $30 million, compared with a reversal of credit losses of $13 million in the fourth quarter of 2017, primarily due to higher loan losses in CIBC FirstCaribbean resulting from the Barbados government debt restructuring noted above.

Non-interest expenses of $350 million were up $16 million from the fourth quarter of 2017, mainly due to increased spending on strategic initiatives.

Income tax benefit was up $16 million from the fourth quarter of 2017, mainly due to the tax impact of the items noted above.

Consolidated balance sheet







$ millions, as at October 31

2018

2017

ASSETS





Cash and non-interest-bearing deposits with banks

$

4,380

$

3,440

Interest-bearing deposits with banks

13,311

10,712

Securities (1)

101,664

93,419

Cash collateral on securities borrowed

5,488

5,035

Securities purchased under resale agreements

43,450

40,383

Loans





Residential mortgages

207,749

207,271

Personal

43,058

40,937

Credit card

12,673

12,378

Business and government

109,555

97,766

Allowance for credit losses

(1,639)

(1,618)




371,396

356,734

Other





Derivative instruments

21,431

24,342

Customers' liability under acceptances

10,265

8,824

Land, buildings and equipment

1,795

1,783

Goodwill

5,564

5,367

Software and other intangible assets

1,945

1,978

Investments in equity-accounted associates and joint ventures

526

715

Deferred tax assets

601

727

Other assets

15,283

11,805




57,410

55,541



$

597,099

$

565,264

LIABILITIES AND EQUITY





Deposits





Personal

$

163,879

$

159,327

Business and government


240,149

225,622

Bank

14,380

13,789

Secured borrowings

42,607

40,968




461,015

439,706

Obligations related to securities sold short


13,782

13,713

Cash collateral on securities lent

2,731

2,024

Obligations related to securities sold under repurchase agreements

30,840

27,971

Other





Derivative instruments

20,973

23,271

Acceptances

10,296

8,828

Deferred tax liabilities

43

30

Other liabilities

18,223

15,275




49,535

47,404

Subordinated indebtedness

4,080

3,209

Equity





Preferred shares

2,250

1,797

Common shares

13,243

12,548

Contributed surplus


136

137

Retained earnings

18,537

16,101

Accumulated other comprehensive income (AOCI)


777

452

Total shareholders' equity

34,943

31,035

Non-controlling interests

173

202

Total equity

35,116

31,237

$

597,099

$

565,264

(1)

Securities balances have been aggregated in the current year, with prior periods amended to reflect this presentation. See Note 4 to the consolidated financial statements in our 2018 Annual Report, for additional details.

Consolidated statement of income

For the three

For the twelve

months ended

months ended

2018

2018

2017

2018

2017

$ millions, except as noted

Oct. 31

Jul. 31

Oct. 31

Oct. 31

Oct. 31

Interest income













Loans

$

3,764

$

3,598

$

3,143

$

13,901

$

11,028

Securities

583

612

479


2,269

1,890

Securities borrowed or purchased under resale agreements

310

273

148


1,053

495

Deposits with banks

79

73

55


282

180


4,736

4,556

3,825


17,505

13,593

Interest expense













Deposits

1,852

1,659

1,174


6,240

3,953

Securities sold short

75

67

64


272

226

Securities lent or sold under repurchase agreements

224

200

73


736

254

Subordinated indebtedness

43

49

38


174

142

Other

3

4

12


18

41


2,197

1,979

1,361


7,440

4,616

Net interest income

2,539

2,577

2,464


10,065

8,977

Non-interest income













Underwriting and advisory fees

91

138

116


420

452

Deposit and payment fees

223

217

214


877

843

Credit fees

212

219

199


851

744

Card fees

128

125

119


510

463

Investment management and custodial fees

328

314

284


1,247

1,034

Mutual fund fees

406

410

396


1,624

1,573

Insurance fees, net of claims

105

109

107


431

427

Commissions on securities transactions

89

85

86


357

349

Gains from financial instruments measured/designated at fair value














through profit or loss (FVTPL), net (2017: Trading income and















designated at fair value (FVO) gains, net)

191

152

40

(1)

603

227

 (1)

Gains (losses) from debt securities measured at fair value through other














comprehensive income (FVOCI) and amortized cost, net (2017:















Available-for-sale (AFS) securities gains, net)

(58)

(9)

37


(35)

143

Foreign exchange other than trading

64

66

59


310

252

Income from equity-accounted associates and joint ventures

27

36

26


121

101

Other

107

108

122


453

695


1,913

1,970

1,805


7,769

7,303

Total revenue

4,452

4,547

4,269


17,834

16,280

Provision for credit losses

264

241

229


870

829

Non-interest expenses













Employee compensation and benefits


1,353

1,437

1,316


5,665

5,198

Occupancy costs

228

218

215


875

822

Computer, software and office equipment

467

441

450


1,742

1,630

Communications

78

77

78


315

317

Advertising and business development

95

83

89


327

282

Professional fees

71

55

71


226

229

Business and capital taxes

26

27

26


103

96

Other

273

234

325


1,005

997


2,591

2,572

2,570


10,258

9,571

Income before income taxes

1,597

1,734

1,470


6,706

5,880

Income taxes

329

365

306


1,422

1,162

Net income

$

1,268

$

1,369

$

1,164

$

5,284

$

4,718

Net income attributable to non-controlling interests

$

2

$

4

$

5

$

17

$

19

Preferred shareholders

$

24

$

23

$

24

$

89

$

52

Common shareholders

1,242

1,342

1,135


5,178

4,647

Net income attributable to equity shareholders

$

1,266

$

1,365

$

1,159

$

5,267

$

4,699

Earnings per share (in dollars)














Basic

$

2.81

$

3.02

$

2.60

$

11.69

$

11.26

Diluted

2.80

3.01

2.59


11.65

11.24

Dividends per common share (in dollars)

1.36

1.33

1.30


5.32

5.08

(1)

Reclassified to conform to the presentation adopted in the current year.

Consolidated statement of comprehensive income

For the three

For the twelve



months ended

months ended



2018

2018

2017

2018

2017

$ millions

Oct. 31

Jul. 31

Oct. 31

Oct. 31

Oct. 31

Net income

$

1,268

$

1,369

$

1,164

$

5,284

$

4,718

Other comprehensive income (OCI), net of income tax, that is subject to subsequent













reclassification to net income











Net foreign currency translation adjustments











Net gains (losses) on investments in foreign operations

340

435

1,084

635

(1,148)

Net gains (losses) on hedges of investments in foreign operations

(159)

(284)

(653)

(349)

772




181

151

431

286

(376)

Net change in debt securities measured at FVOCI (2017: AFS debt and












equity securities)











Net gains (losses) on securities measured at FVOCI

(28)

(27)

6

(142)

6

Net (gains) losses reclassified to net income

-

(4)

(30)

(29)

(107)




(28)

(31)

(24)

(171)

(101)

Net change in cash flow hedges











Net gains (losses) on derivatives designated as cash flow hedges

(66)

62

20

(25)

70

Net (gains) losses reclassified to net income

38

(52)

(14)

(26)

(60)


(28)

10

6

(51)

10

OCI, net of income tax, that is not subject to subsequent reclassification to net income













Net gains (losses) on post-employment defined benefit plans

(95)

219

(125)

226

139

Net gains (losses) due to fair value change of FVO liabilities attributable












to changes in credit risk                                                                               


(8)

8

(3)

(2)

(10)

Net gains (losses) on equity securities designated at FVOCI

10

1

n/a

29

n/a

Total OCI (1)

32

358

285

317

(338)

Comprehensive income

$

1,300

$

1,727

$

1,449

$

5,601

$

4,380

Comprehensive income attributable to non-controlling interests

$

2

$

4

$

5

$

17

$

19

Preferred shareholders

$

24

$

23

$

24

$

89

$

52

Common shareholders

1,274

1,700

1,420

5,495

4,309

Comprehensive income attributable to equity shareholders

$

1,298

$

1,723

$

1,444

$

5,584

$

4,361

(1)

Includes $3 million of losses for the quarter ended October 31, 2018 (July 31, 2018: $4 million; October 31, 2017: $7 million), relating to our investments in equity-accounted associates and joint ventures.

n/a

Not applicable.



For the three

For the twelve



months ended

months ended




2018

2018

2017

2018

2017

$ millions

Oct. 31

Jul.31

Oct. 31

Oct. 31

Oct. 31

Income tax (expense) benefit allocated to each component of OCI










Subject to subsequent reclassification to net income











Net foreign currency translation adjustments











Net gains (losses) on investments in foreign operations

$

(2)

$

(33)

$

(34)

$

(31)

$

42

Net gains (losses) on hedges of investments in foreign operations

5

41

136

43

(170)




3

8

102

12

(128)

Net change in debt securities measured at FVOCI (2017: AFS debt and












equity securities)











Net gains (losses) on securities measured at FVOCI

7

(1)

(8)

18

(23)

Net (gains) losses reclassified to net income

-

1

7

8

36




7

-

(1)

26

13

Net change in cash flow hedges











Net gains (losses) on derivatives designated as cash flow hedges

22

(21)

(5)

8

(23)

Net (gains) losses reclassified to net income

(14)

18

5

9

22



8

(3)

-

17

(1)

Not subject to subsequent reclassification to net income











Net gains (losses) on post-employment defined benefit plans

30

(79)

42

(87)

(54)

Net gains (losses) due to fair value change of FVO liabilities attributable












to changes in credit risk                                                                         


3

(3)

1

1

4

Net gains (losses) on equity securities designated at FVOCI

(4)

(1)

n/a

(11)

n/a



$

47

$

(78)

$

144

$

(42)

$

(166)

n/a

Not applicable.

Consolidated statement of changes in equity

For the three

For the twelve


months ended

months ended



2018

2018

2017

2018

2017

$ millions

Oct. 31

Jul. 31

Oct. 31

Oct. 31

Oct. 31

Preferred shares










Balance at beginning of period

$

2,250

$

2,248

$

1,796

$

1,797

$

1,000

Issue of preferred shares

-

-

-

450

800

Treasury shares

-

2

1

3

(3)

Balance at end of period

$

2,250

$

2,250

$

1,797

$

2,250

$

1,797

Common shares










Balance at beginning of period

$

13,201

$

13,166

$

12,197

$

12,548

$

8,026

Issued pursuant to the acquisition of The PrivateBank

-

-

-

194

3,443

Issued pursuant to the acquisition of Geneva Advisors

-

-

126

-

126

Issued pursuant to the acquisition of Wellington Financial

-

-

-

47

-

Other issue of common shares

94

94

241

555

957

Purchase of common shares for cancellation

(52)

(52)

-

(104)

-

Treasury shares

-

(7)

(16)

3

(4)

Balance at end of period

$

13,243

$

13,201

$

12,548

$

13,243

$

12,548

Contributed surplus










Balance at beginning of period

$

133

$

137

$

137

$

137

$

72

Issue of replacement equity-settled awards pursuant to the acquisition of The PrivateBank

-

-

-

-

72

Compensation expense arising from equity-settled share-based awards

8

9

3

31

7

Exercise of stock options and settlement of other equity-settled share-based awards

(4)

(14)

(3)

(32)

(15)

Other

(1)

1

-

-

1

Balance at end of period

$

136

$

133

$

137

$

136

$

137

Retained earnings










Balance at beginning of period under IAS 39

n/a

n/a

$

15,535

$

16,101

$

13,584

Impact of adopting IFRS 9 at November 1, 2017

n/a

n/a

n/a

(144)

n/a

Balance at beginning of period under IFRS 9

$

18,051

$

17,412

n/a

15,957

n/a

Net income attributable to equity shareholders

1,266

1,365

1,159

5,267

4,699

Dividends











Preferred

(24)

(23)

(24)

(89)

(52)

Common


(602)

(589)

(569)

(2,356)

(2,121)

Premium on purchase of common shares for cancellation

(163)

(150)

-

(313)

-

Realized gains (losses) on equity securities designated at FVOCI reclassified from AOCI

1

15

n/a

49

n/a

Other

8

(1)

21

(1)

-

22

(1)

(9)

Balance at end of period

$

18,537

$

18,051

$

16,101

$

18,537

$

16,101

AOCI, net of income tax










AOCI, net of income tax, that is subject to subsequent reclassification to net income











Net foreign currency translation adjustments











Balance at beginning of period

$

843

$

692

$

307

$

738

$

1,114

Net change in foreign currency translation adjustments

181

151

431

286

(376)

Balance at end of period

$

1,024

$

843

$

738

$

1,024

$

738

Net gains (losses) on debt securities measured at FVOCI (2017: AFS debt and equity securities)











Balance at beginning of period under IAS 39

n/a

n/a

$

84

$

60

$

161

Impact of adopting IFRS 9 at November 1, 2017

n/a

n/a

n/a

(28)

n/a

Balance at beginning of period under IFRS 9

$

(111)

$

(80)

n/a

32

n/a

Net change in securities measured at FVOCI

(28)

(31)

(24)

(171)

(101)

Balance at end of period

$

(139)

$

(111)

$

60

$

(139)

$

60

Net gains (losses) on cash flow hedges











Balance at beginning of period

$

10

$

-

$

27

$

33

$

23

Net change in cash flow hedges

(28)

10

6

(51)

10

Balance at end of period

$

(18)

$

10

$

33

$

(18)

$

33

AOCI, net of income tax, that is not subject to subsequent reclassification to net income











Net gains (losses) on post-employment defined benefit plans











Balance at beginning of period

$

(48)

$

(267)

$

(244)

$

(369)

$

(508)

Net change in post-employment defined benefit plans

(95)

219

(125)

226

139

Balance at end of period

$

(143)

$

(48)

$

(369)

$

(143)

$

(369)

Net gains (losses) due to fair value change of FVO liabilities attributable to changes in credit risk











Balance at beginning of period

$

(4)

$

(12)

$

(7)

$

(10)

$

-

Net change attributable to changes in credit risk

(8)

8

(3)

(2)

(10)

Balance at end of period

$

(12)

$

(4)

$

(10)

$

(12)

$

(10)

Net gains (losses) on equity securities designated at FVOCI











Impact of adopting IFRS 9 at November 1, 2017

n/a

n/a

n/a

$

85

n/a

Balance at beginning of period under IFRS 9

$

56

$

70

n/a

85

n/a

Net gains (losses) on equity securities designated at FVOCI

10

1

n/a

29

n/a

Realized gains (losses) on equity securities designated at FVOCI reclassified to retained earnings (2)

(1)

(15)

n/a

(49)

n/a

Balance at end of period

$

65

$

56

n/a

$

65

n/a

Total AOCI, net of income tax

$

777

$

746

$

452

$

777

$

452

Non-controlling interests










Balance at beginning of period

n/a

n/a

$

190

$

202

$

201

Impact of adopting IFRS 9 at November 1, 2017

n/a

n/a

n/a

(4)

n/a

Balance at beginning of period under IFRS 9

$

173

$

180

n/a

198

n/a

Net income (loss) attributable to non-controlling interests

2

4

5

17

19

Dividends

(2)

(4)

-

(31)

(8)

Other

-

(7)

7

(11)

(10)

Balance at end of period

$

173

$

173

$

202

$

173

$

202

Equity at end of period

$

35,116

$

34,554

$

31,237

$

35,116

$

31,237

(1)

Includes the recognition of loss carryforwards relating to foreign exchange translation amounts on CIBC's net investment in foreign operations that were previously reclassified to retained earnings as part of our transition to IFRS in 2012.

(2)

Includes $1 million of gains reclassified to retained earnings for the quarter ended October 31, 2018 (July 31, 2018: $8 million of losses; October 31, 2017: n/a), relating to our investments in equity-accounted associates and joint ventures.

n/a

Not applicable.

Consolidated statement of cash flows

For the three

For the twelve



months ended

months ended




2018

2018

2017

2018

2017

$ millions

Oct. 31

Jul. 31

Oct.31

Oct. 31

Oct. 31

Cash flows provided by (used in) operating activities











Net income

$

1,268

$

1,369

$

1,164

$

5,284

$

4,718

Adjustments to reconcile net income to cash flows provided by (used in) operating activities:












Provision for credit losses

264

241

229

870

829

Amortization and impairment (1)

162

167

152

657

542

Stock options and restricted shares expense

8

9

3

31

7

Deferred income taxes

(33)

(8)

30

69

21

Losses (gains) from debt securities measured at FVOCI and amortized cost













(2017: AFS debt and equity securities (gains), net)

58

9

(37)

35

(143)

Net losses (gains) on disposal of land, buildings and equipment

-

(2)

1

(14)

(305)

Other non-cash items, net

10

(79)

(32)

(292)

(15)

Net changes in operating assets and liabilities













Interest-bearing deposits with banks

827

(2,215)

4,998

(2,599)

394


Loans, net of repayments

(4,999)

(1,971)

(7,392)

(16,155)

(30,547)


Deposits, net of withdrawals

1,151

10,502

(938)

20,770

18,407


Obligations related to securities sold short

1,630

(1,573)

1,131

69

3,375


Accrued interest receivable

(176)

37

(144)

(341)

(34)


Accrued interest payable

126

(11)

152

205

90


Derivative assets

467

2,047

2,097

2,780

3,588


Derivative liabilities

(800)

(526)

(4,881)

(2,084)

(5,549)


Securities measured at FVTPL (2017: Trading and FVO securities)

(1,786)

1,691

(2,611)

(647)

(657)


Other assets and liabilities designated at fair value (2017: Other FVO assets














and liabilities)                                                                                                      


(452)

1,021

(234)

(380)

1,071


Current income taxes

22

61

(17)

(301)

(1,063)


Cash collateral on securities lent

269

471

(37)

707

(494)


Obligations related to securities sold under repurchase agreements

(2,145)

(5,388)

5,418

2,869

16,277


Cash collateral on securities borrowed

(405)

1,257

831

(453)

398


Securities purchased under resale agreements

1,945

(1,776)

273

(1,195)

(10,556)


Other, net 

1,377

(3,461)

1,842

(18)

2,103





(1,212)

1,872

1,998

9,867

2,457

Cash flows provided by (used in) financing activities











Issue of subordinated indebtedness

-

34

-

1,534

-

Redemption/repurchase/maturity of subordinated indebtedness

(19)

(619)

-

(638)

(55)

Issue of preferred shares, net of issuance cost

-

-

-

445

792

Issue of common shares for cash

43

34

38

186

194

Purchase of common shares for cancellation

(215)

(202)

-

(417)

-

Net sale (purchase) of treasury shares

-

(5)

(15)

6

(7)

Dividends paid

(579)

(566)

(393)

(2,109)

(1,425)





(770)

(1,324)

(370)

(993)

(501)

Cash flows provided by (used in) investing activities











Purchase of securities measured/designated at FVOCI and amortized cost












(2017: Purchase of AFS securities)

(8,676)

(8,797)

(8,975)

(33,011)

(37,864)

Proceeds from sale of securities measured/designated at FVOCI and amortized cost












(2017: Proceeds from sale of AFS securities)

6,865

3,277

1,923

12,992

18,787

Proceeds from maturity of debt securities measured at FVOCI and amortized cost












(2017: Proceeds from maturity of AFS securities)

4,619

3,467

4,645

12,402

19,368

Cash used in acquisitions, net of cash acquired

-

-

(27)

(315)

(2,517)

Net cash provided by dispositions of investments in equity-accounted associates and












joint ventures

-

51

40

200

60

Net sale (purchase) of land, buildings and equipment

(132)

(38)

(66)

(255)

201





2,676

(2,040)

(2,460)

(7,987)

(1,965)

Effect of exchange rate changes on cash and non-interest-bearing deposits with banks

23

43

65

53

(51)

Net increase (decrease) in cash and non-interest-bearing deposits with banks












during the period

717

(1,449)

(767)

940

(60)

Cash and non-interest-bearing deposits with banks at beginning of period

3,663

5,112

4,207

3,440

3,500

Cash and non-interest-bearing deposits with banks at end of period (2)

$

4,380

$

3,663

$

3,440

$

4,380

$

3,440

Cash interest paid

$

2,071

$

1,990

$

1,209

$

7,235

$

4,526

Cash interest received

4,402

4,407

3,491

16,440

12,611

Cash dividends received

158

186

191

724

949

Cash income taxes paid

340

312

293

1,654

2,204

(1)

Comprises amortization and impairment of buildings, furniture, equipment, leasehold improvements, and software and other intangible assets.

(2)

Includes restricted balance of $438 million (July 31, 2018: $407 million; October 31, 2017: $436 million).

Non-GAAP measures

We use a number of financial measures to assess the performance of our business lines. Some measures are calculated in accordance with International Financial Reporting Standards (IFRS or GAAP), while other measures do not have a standardized meaning under GAAP, and accordingly, these measures may not be comparable to similar measures used by other companies. Investors may find these non-GAAP measures useful in understanding how management views underlying business performance.

The following table provides a quarterly reconciliation of non-GAAP to GAAP measures related to CIBC on a consolidated basis. For a more detailed discussion and for an annual reconciliation of non-GAAP to GAAP measures, see the "Non-GAAP measures" section of CIBC's 2018 Annual Report.

As at or for the

As at or for the





three months ended

twelve months ended




2018

2018

2017


2018

2017

$ millions


Oct. 31

Jul. 31

Oct. 31


Oct. 31

Oct. 31

Reported and adjusted diluted EPS



















Reported net income attributable to common shareholders

A

$

1,242

$

1,342

$

1,135

$

5,178

$

4,647

After-tax impact of items of note (1)


91

30

99


252

(53)

Adjusted net income attributable to common shareholders (2)

B

$

1,333

$

1,372

$

1,234

$

5,430

$

4,594

Diluted weighted-average common shares outstanding (thousands)

C

444,504

445,504

438,556


444,627

413,563

Reported diluted EPS ($)

A/C

$

2.80

$

3.01

$

2.59

$

11.65

$

11.24

Adjusted diluted EPS ($) (2)

B/C

3.00

3.08

2.81


12.21

11.11

Reported and adjusted return on common shareholders' equity

















Average common shareholders' equity

D

$

32,200

$

31,836

$

28,471

$

31,184

$

25,393

Reported return on common shareholders' equity

A/D

(3)

15.3

%

16.7

%

15.8

%

16.6

%

18.3

%

Adjusted return on common shareholders' equity (2)

B/D

(3)

16.4

%

17.1

%

17.2

%

17.4

%

18.1

%



Canadian

U.S.







Canadian

Commercial

Commercial







Personal and

Banking and

Banking and







Small Business

Wealth

Wealth

Capital

Corporate

CIBC

$ millions, for the three months ended

Banking

Management

Management

Markets

and Other

Total

Oct. 31

Reported net income (loss)

$

668

$

333

$

131

$

233

$

(97)

$

1,268

2018

After-tax impact of items of note (1)

1

1

8

-

86

96

Adjusted net income (loss) (2)

$

669

$

334

$

139

$

233

$

(11)

$

1,364

Jul. 31

Reported net income (loss)

$

639

$

350

$

162

$

265

$

(47)

$

1,369

2018

After-tax impact of items of note (1)

4

-

9

-

17

30

Adjusted net income (loss) (2)

$

643

$

350

$

171

$

265

$

(30)

$

1,399

Oct. 31

Reported net income (loss)

$

551

$

287

$

107

$

222

$

(3)

$

1,164

2017

After-tax impact of items of note (1)

72

1

12

-

14

99

Adjusted net income (2)

$

623

$

288

$

119

$

222

$

11

$

1,263















$ millions, for the twelve months ended












Oct. 31

Reported net income (loss)

$

2,547

$

1,307

$

565

$

1,069

$

(204)

$

5,284

2018

After-tax impact of items of note (1)

9

1

27

-

220

257

Adjusted net income (2)

$

2,556

$

1,308

$

592

$

1,069

$

16

$

5,541

Oct. 31

Reported net income (loss)

$

2,420

$

1,138

$

203

$

1,090

$

(133)

$

4,718

2017

After-tax impact of items of note (1)

(170)

1

19

-

97

(53)

Adjusted net income (loss) (2)

$

2,250

$

1,139

$

222

$

1,090

$

(36)

$

4,665

(1)

Reflects impact of items of note under the "Financial results" section of the 2018 Annual Report.

(2)

Non-GAAP measure.

(3)

Annualized.

Items of note

For the three

For the twelve

months ended

months ended

2018

2018

2017

2018

2017

$ millions

Oct. 31

Jul. 31

Oct. 31

Oct. 31

Oct. 31

Gain on the sale and lease back of certain retail properties

$

-

$

-

$

-

$

-

$

(299)

Amortization of acquisition-related intangible assets

26

31

19

115

41

Incremental losses on debt securities and loans in CIBC FirstCaribbean resulting from the Barbados government











debt restructuring

89

-

-

89

-

Fees and charges related to the launch of Simplii Financial and the related wind-down of President's Choice Financial

-

-

98

-

98

Transaction and integration-related costs as well as purchase accounting adjustments associated with the











acquisitions of The PrivateBank and Geneva Advisors (1)

8

9

46

16

104

Increase in legal provisions

-

-

-

-

45

Increase (decrease) in collective allowance recognized in Corporate and Other (2)

-

-

(18)

-

(18)

Pre-tax impact of items of note on net income

123

40

145

220

(29)

Income tax impact on above items of note

(27)

(10)

(46)

(51)

(24)

Charge from net tax adjustments resulting from U.S. tax reforms

-

-

-

88

-

After-tax impact of items of note on net income

$

96

$

30

$

99

$

257

$

(53)

After-tax impact of items of note on non-controlling interests

(5)

-

-

(5)

-

After-tax impact of items of note on net income attributable to common shareholders

91

30

99

252

(53)

(1)

Transaction costs include legal and other advisory fees, financing costs associated with pre-funding the cash component of the merger consideration, and interest adjustments relating to the obligation payable to dissenting shareholders. Integration costs are comprised of direct and incremental costs incurred as part of planning for and executing the integration of the businesses of The PrivateBank (subsequently rebranded as CIBC Bank USA) and Geneva Advisors with CIBC, including enabling cross-sell opportunities and expansion of services in the U.S. market, the upgrade and conversion of systems and processes, project management, integration-related travel, severance, consulting fees and marketing costs related to rebranding activities. Purchase accounting adjustments, included as items of note beginning in the fourth quarter of 2017, include the accretion of the acquisition date fair value discount on the acquired loans of The PrivateBank, the collective allowance established for new loan originations and renewals of acquired loans (prior to the adoption of IFRS 9 in the first quarter of 2018), and changes in the fair value of contingent consideration relating to the Geneva Advisors acquisition.

(2)

Relates to collective allowance (prior to the adoption of IFRS 9), except for: (i) residential mortgages greater than 90 days delinquent; (ii) personal loans and scored small business loans greater than 30 days delinquent; (iii) net write-offs for the card portfolio; and (iv) the collective allowance related to CIBC Bank USA, which are all reported in the respective SBUs.

Basis of presentation
The interim consolidated financial information in this news release is prepared in accordance with IFRS and is unaudited whereas the annual consolidated financial information is derived from audited financial statements. These interim consolidated financial statements follow the same accounting policies and methods of application as CIBC's consolidated financial statements as at and for the year ended October 31, 2018.

Conference Call/Webcast
The conference call will be held at 8:00 a.m. (ET) and is available in English (416-340-2217, or toll-free 1-800-806-5484, passcode 8660945#) and French (514-861-2255, or toll-free 1-877-405-9213, passcode 1105464#). Participants are asked to dial in 10 minutes before the call. Immediately following the formal presentations, CIBC executives will be available to answer questions.

A live audio webcast of the conference call will also be available in English and French at www.cibc.com/en/about-cibc/investor-relations/quarterly-results.html

Details of CIBC's 2018 fourth quarter and fiscal year results, as well as a presentation to investors, will be available in English and French at www.cibc.com, Investor Relations section, prior to the conference call/webcast. We are not incorporating information contained on the website in this news release.

A telephone replay will be available in English (905-694-9451 or 1-800-408-3053, passcode 6527164#) and French (514-861-2272 or 1-800-408-3053, passcode 9609900#) until 11:59 p.m. (ET) December 6, 2018. The audio webcast will be archived at www.cibc.com/en/about-cibc/investor-relations/quarterly-results.html

About CIBC
CIBC is a leading North American financial institution with 10 million(1) personal banking, business, public sector and institutional clients. Across Personal and Small Business Banking, Commercial Banking and Wealth Management, and Capital Markets businesses, CIBC offers a full range of advice, solutions and services through its leading digital banking network, and locations across Canada, in the United States and around the world. Ongoing news releases and more information about CIBC can be found at www.cibc.com/en/about-cibc/media-centre.html.

(1)

    Revised to consider clients that have banking relationships with both CIBC and Simplii Financial.

______________________________________

The information below forms a part of this news release.

Nothing in CIBC's corporate website (www.cibc.com) should be considered incorporated herein by reference.

The Board of Directors of CIBC reviewed this news release prior to it being issued.

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 news release, in other filings with Canadian securities regulators or the U.S. Securities and Exchange Commission and in other communications. All such statements are made pursuant to the "safe harbour" provisions of, and are intended to be forward-looking statements under applicable Canadian and U.S. securities legislation, including the U.S. Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, statements made in the "Core business performance", "Strong fundamentals", and "Making a difference in our Communities" sections of this news release, and the Management's Discussion and Analysis in our 2018 Annual Report under the heading "Financial performance overview – Outlook for calendar year 2019" and other statements about our operations, business lines, financial condition, risk management, priorities, targets, ongoing objectives, strategies, the regulatory environment in which we operate and outlook for calendar year 2019 and subsequent periods. Forward-looking statements are typically identified by the words "believe", "expect", "anticipate", "intend", "estimate", "forecast", "target", "objective" and other similar expressions or future or conditional verbs such as "will", "should", "would" and "could". By their nature, these statements require us to make assumptions, including the economic assumptions set out in the "Financial performance overview – Outlook for calendar year 2019" section of our 2018 Annual Report, as updated by quarterly reports, and are subject to inherent risks and uncertainties that may be general or specific. A variety of factors, many of which are beyond our control, affect our operations, performance and results, and could cause actual results to differ materially from the expectations expressed in any of our forward-looking statements. These factors include: credit, market, liquidity, strategic, insurance, operational, reputation and legal, regulatory and environmental risk; the effectiveness and adequacy of our risk management and valuation models and processes; legislative or regulatory developments in the jurisdictions where we operate, including the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations issued and to be issued thereunder, the Organisation for Economic Co-operation and Development Common Reporting Standard, and regulatory reforms in the United Kingdom and Europe, the Basel Committee on Banking Supervision's global standards for capital and liquidity reform, and those relating to bank recapitalization legislation and the payments system in Canada; amendments to, and interpretations of, risk-based capital guidelines and reporting instructions, and interest rate and liquidity regulatory guidance; the resolution of legal and regulatory proceedings and related matters; the effect of changes to accounting standards, rules and interpretations; changes in our estimates of reserves and allowances; changes in tax laws; changes to our credit ratings; political conditions and developments, including changes relating to economic or trade matters; the possible effect on our business of international conflicts and terrorism; natural disasters, public health emergencies, disruptions to public infrastructure and other catastrophic events; reliance on third parties to provide components of our business infrastructure; potential disruptions to our information technology systems and services; increasing cyber security risks which may include theft of assets, unauthorized access to sensitive information, or operational disruption; social media risk; losses incurred as a result of internal or external fraud; anti-money laundering; the accuracy and completeness of information provided to us concerning clients and counterparties; the failure of third parties to comply with their obligations to us and our affiliates or associates; intensifying competition from established competitors and new entrants in the financial services industry including through internet and mobile banking; technological change; global capital market activity; changes in monetary and economic policy; currency value and interest rate fluctuations, including as a result of market and oil price volatility; general business and economic conditions worldwide, as well as in Canada, the U.S. and other countries where we have operations, including increasing Canadian household debt levels and global credit risks; our success in developing and introducing new products and services, expanding existing distribution channels, developing new distribution channels and realizing increased revenue from these channels; changes in client spending and saving habits; our ability to attract and retain key employees and executives; our ability to successfully execute our strategies and complete and integrate acquisitions and joint ventures; the risk that expected synergies and benefits of the acquisition of PrivateBancorp, Inc. will not be realized within the expected time frame or at all; and our ability to anticipate and manage the risks associated with these factors. This list is not exhaustive of the factors that may affect any of our forward-looking statements. These and other factors should be considered carefully and readers should not place undue reliance on our forward-looking statements. Any forward-looking statements contained in this news release represent the views of management only as of the date hereof and are presented for the purpose of assisting our shareholders and financial analysts in understanding our financial position, objectives and priorities and anticipated financial performance as at and for the periods ended on the dates presented, and may not be appropriate for other purposes. We do not undertake to update any forward-looking statement that is contained in this news release or in other communications except as required by law.

SOURCE CIBC - Investor Relations

Investor Relations: Amy South, SVP, 416-594-7386, [email protected]; Jason Patchett, analyst enquiries, 416-980-8691, [email protected]; Alice Dunning, investor enquiries, 416-861-8870, [email protected]; Media Enquiries: Erica Belling, 416-594-7251, [email protected]; Tom Wallis, 416-980-4048, [email protected]

Related Links

http://www.cibc.com

Organization Profile

CIBC - Investor Relations

Related Organization(s)

Canadian Imperial Bank of Commerce

CIBC

About CIBC CIBC is a leading North American financial institution with 13 million personal banking, business, public sector and institutional clients. Across Personal and Business Banking, Commercial Banking and Wealth Management, and Capital Markets businesses, CIBC offers...