CIBC Q2 writedown; cites market environment

Source: Exec Digital Canada

Date :5/30/2008 2:20:37 AM

Canadian Imperial Bank of Commerce posted a second quarter loss of $1.11 billion on Thursday as market conditions hit CIBC’s wholesale and retail brokerage operations.

The loss was worth $3.00 per share, down from year-ago net income of $807 million or $2.27 per share.

It included a charge of $2.48 billion, or $1.67 billion after tax, on writedowns of structured credit, adding to the $3.46 billion in first-quarter writedowns.

Sustainable performance

Gerald T. McCaughey, President and Chief Executive Officer blamed the negative performance on the current market environment but said that CIBC’s franchise remains “solid”.

"Our capital position is strong and our core businesses are well positioned for growth. In support of our strategy of consistent and sustainable performance, we are taking further steps to adapt our business profile and risk management processes to evolving financial market risks," he said.

Retail banking

Retail banking revenue from CIBC's consumer operations slipped three percent to $2.24 billion while the segment’s earnings fell to $509 million, compared with $617 million a year ago.

CIBC was the only big Canadian bank to report lower results in its retail banking operations during the February-April period.

Shares in the bank slipped $1.38 to $69.47 on the TSE after falling as low as $69 earlier in the session.

May 30, 2008