The Canadian Imperial Bank of Commerce has agreed to pay US$250 million to Enron to settle the bankrupt company’s claims against the bank.

The settlement, which the bank announced on Friday, is much smaller than the US$2.4 billion CIBC agreed to pay last Wednesday to settle litigation with Enron’s shareholders.

Once approved by the court, the settlement will address the “megaclaims” lawsuit Enron launched against the CIBC and other banks.

The bank said it paid US$24 million in return for which Enron will allow about US$81 million of CIBC’s claims in its bankruptcy proceedings.

CIBC agreed to subordinate another US$42 million worth of claims, which the bank had already written off.

The bank said the US$250 million was accounted for in the reserves taken when it settled the class-action suit.

CIBC stock fell 6¢ to $71.69 Friday, bringing the loss for the week to $8.32.