CIBC raises dividends, plans repurchase despite Q4 profit

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The Canadian Imperial Bank of Commerce joined its peers Thursday to reward its shareholders for their patience.

The bank said its board of directors approved a dividend increase that would raise the quarterly payout to $ 1.61 per share from $ 1.48, with effect from the January 28 distribution. It also announced plans to repurchase up to 10 million of its common stock.

Like the other lenders that have made similar moves this week, the CIBC was able to share its wealth after the Office of the Superintendent of Financial Institutions recently lifted its pandemic-era ban on dividend increases and stock repurchases.

The CIBC also said on Thursday that its full-year profit rose to $ 6.4 billion from $ 3.8 billion in 2020. For the fourth quarter, which ended October 31, earnings rose 42 percent year-over-year to $ 1.44 billion. But on an adjusted basis, the bank lived below expectations at $ 3.37 per share. shares; the average analyst estimate was $ 3.54.

Unlike other banks this week, whose profits received a boost from improved credit quality, CIBC set aside $ 78 million for loans that could go bad during the fourth quarter. In the previous quarter, the bank had benefited from the release of $ 99 million previously set aside as provisions for its loan books.

CIBC’s central Canadian private and banking division saw profits stagnate in the last quarter of the financial year. Net income was $ 597 million compared to $ 590 million a year earlier and $ 642 million in the previous quarter. The division’s provisions for credit losses jumped to $ 164 million from $ 67 million in the third quarter of the fiscal year. In one release, CIBC attributed the delivery in part because of what it calls “model parameter updates.”

The bank’s other divisions performed better in the quarter, as profits rose year-on-year in the capital markets, Canadian commercial banking and asset management, as well as in CIBC’s US division, where profits doubled year-on-year to $ 204 million.

“In light of the ongoing global pandemic, our bank continued to invest for the future, including expanding our platform and opportunities in the United States, accelerating the growth of our Canadian consumer franchise, and making fundamental investments in cloud technology and other opportunities that will set us up. able to do more for customers in 2022 and beyond, “said CIBC President and CEO Victor Dodig in a statement.

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