CIBC today announced improved profit for the second quarter ended April 30.

Net income for the quarter was $585 million, or $1.65 a share, compared with net income of $440 million, or $1.21 a share, a year ago.

The bank said a tax recovery and a reduction in its credit loss allowance helped offset lower retail banking sales.

Total revenue slipped to $2.77 billion from $2.82 billion.

“We continued to make steady progress during the quarter against our three key business priorities to position CIBC for consistent and sustainable performance over the long term,” said Gerry McCaughey, president and CEO.

The bank said earnings were boosted by a $35 million, or 10¢ a share, recovery after a tax audit and a $25 million, or 5¢ a share, reversal in its general allowance for credit losses.

Loan loss provisions were $138 million, down from $159 million a year ago while return on equity was 25.6% compared with 21%.

CIBC Retail Markets reported revenue of $1,964 million, compared with $2,059 million in the prior quarter and $1,971 million for the same period last year.

CIBC World Markets reported revenue of $607 million, compared with $679 million in the prior quarter and $742 million for the same period last year.

Investment banking and credit products revenue was down significantly from a very strong second quarter of 2005, primarily due to losses associated with corporate loan hedging programs and lower revenue in U.S. investment banking and real estate finance. The prior year quarter included gains on the sale of investments in a discontinued U.S. structuring business.

CIBC World Markets’ core franchise in Canada remains strong. Through the first half of 2006, CIBC World Markets has sustained its position as a leader in equity underwriting in Canada.

CIBC’s U.S. real estate finance business continued its success during the quarter by completing its second commercial mortgage-backed securities offering of the year. CIBC remains focused on niche areas of the U.S. market where it has expertise and the strongest potential for profitability.