The Canadian Press

CIBC (TSX:CM) said Thursday that its core businesses performed well in the fourth quarter despite a recessionary economy.

The Toronto-based bank reported net income of $644 million or $1.56 per share for the quarter ended October 31. That was up from year-ago profit of $436 million or $1.06 per share.

Revenues totalled $2.9 billion for the quarter, compared to $2.2 billion last year.

The figures were in line with analysts expectations for revenue, according to estimates compiled by Thomson Reuters.

CIBC said it benefited from higher fees from arranging stock sales and mergers, which helped offset rising loan-loss provisions.

The bank noted it managed down its structured credit and other run-off portfolios in the quarter, which helped its performance. Quarterly results were positively impacted by a $85-million gain on structured credit run-off activities and $62 million in favourable tax-related items.

Earnings were also affected, however, by $42 million of negative valuation adjustments and $36 million of mark-to-market losses on credit derivatives in its corporate loan-hedging programs.

CIBC also said its provision for credit losses was $424 million, up $202 million from the fourth quarter of 2008, largely due to higher losses in the cards, unsecured personal lending and corporate lending portfolios. That included a $131-million increase at the Retail Markets division, which rose to $362 million.
“Our capital position at year-end is as strong as it has ever been and we continued to exercise expense discipline,” said Gerry McCaughey, CIBC president and chief executive officer.

“We are well positioned heading into 2010 where our focus will continue to be on bringing value to all of our clients and furthering our strategic imperative of delivering consistent and sustainable performance for all of our stakeholders.”

For the fiscal 2009 year ended Oct. 31, CIBC reported net income of $1.2 billion, or $2.65 per share, which compared to a net loss of $2.1 billion or $5.89 per share last year.

The bank pointed out, however, that 2008 earnings were impacted by items of note that produced a negative impact of $12.61 per share.

CIBC shares closed at $68.48 Wednesday on the Toronto Stock Exchange.