(September 7 – 11:15 ET) – CIBC is reporting record earnings for the third quarter ended July 31. The bank says earnings were $601 million, up 53% from the results achieved in the same quarter a year ago. Net income was down 11% from the record results reported in the previous quarter mainly to lower brokerage and investment banking volumes.
Basic earnings per share were $1.47 and return on equity was 23.8%. The bank says these results reflect solid performance in all business lines, tempered by less robust capital markets.
Revenue totalled $3,058 million, up $156 million from a year ago. While Wealth Management and CIBC World Markets revenues were affected by the decline in equity market volumes in the quarter compared to volumes earlier in the year, overall performance exceeded that of the third quarter of 1999.
The bank’s Tier 1 capital ratio improved to 8.9% and its total capital ratio improved to 12%, exceeding targets set by the bank.
CIBC says its U.S. investment banking operation continues to grow. During the quarter, CIBC World Markets led and co-managed equity offerings amounting to US$4.8 billion, up from US$3 billion in the same period last year. As well, it was the adviser of record in merger and acquisition transactions worth US$43 billion, up from US$5.9 billion a year ago.
Growth in the bank’s wealth management client base is also robust, with $165 billion in assets under administration for individuals, an increase of 19% over July 31, 1999.
During the quarter, CIBC realized an after-tax gain of $221 million on the sale of 10 million shares of Global Crossing Ltd. At the end of the quarter, the market value of its total securities portfolio exceeded book value by $2.8 billion.
The bank declared a quarterly dividend of 33¢ per common share. Quarterly dividends were also declarded on several series of Class A Preferred Shares.
-IE Staff