Banking giant reveals results on final day of Big Six’s second-quarter financial announcements
Canadian Imperial Bank of Commerce delivered a better-than-expected performance in the second quarter, propelled by strength in its capital markets arm and a smaller cushion set aside for potential credit losses than analysts had anticipated.
The bank earned $2.05 per share on an adjusted basis, narrowly beating the $1.90 average forecast compiled by S\&P Capital IQ. Net income climbed to $2 billion, or $2.04 per share, marking a 15% increase from the same period last year.
Chief executive Victor Dodig said in a statement the bank was approaching global business environment volatility “from a position of strength, supported by our robust capital position, disciplined risk management and strong credit quality.”
Strategic transition ahead
The quarterly report comes as CIBC prepares for a leadership shift, with longtime capital markets head Harry Culham set to take over as CEO this October. The appointment signals a potential pivot toward strengthening the bank’s position in corporate and investment banking — a unit that delivered a 20% increase in profit this quarter, reaching $566 million. The division benefited from elevated financing and trading revenue as well as strong debt underwriting activity.
CIBC’s capital markets results added to a broader surge in performance from the bank’s U.S. commercial and wealth division, where profits rose 79% to $122 million. That increase came on the back of higher revenues and significantly lower credit loss provisions.
Conservative moves, confident results
In total, the bank earmarked $605 million for credit losses — a notable increase from the $67 million set aside a year ago, but still below analyst forecasts. That figure included $142 million for loans that have yet to show signs of distress, reflecting model-based estimates of future losses in a volatile economic environment. Still, the relatively restrained provisioning stands out at a time when several of CIBC’s peers have taken a more cautious approach.
CIBC’s more modest provisioning may reflect both confidence in its credit quality and a slightly different risk profile. In a landscape where economic uncertainty continues to shape lending decisions — from US tariffs to weakening consumer sentiment — banks are split between preparing for the worst and betting on resilience.
Broad-based growth – but expenses jump
CIBC’s results were also supported by broad-based strength across its core banking units. The personal and business banking arm in Canada generated \$734 million in profit, a 4% year-over-year increase thanks to higher revenues. The Canadian commercial and wealth unit rose 13% to $549 million, buoyed by improved lending margins and a rise in fee-based revenue from managed assets.
Overall revenue was up 14% to $7 billion. But the bank’s expenses climbed too, rising 9% to $3.8 billion — a jump it attributed to stronger performance-based compensation across business lines.
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