Skip to Content News Archives Economy Energy Oil & Gas Renewables Electric Vehicles Mining Commodities Agriculture Real Estate Mortgages Mortgage Rates Finance Banking Insurance Fintech Cryptocurrency Work Wealth Smart Money Wealth Management Investor Personal Finance Family Finance Retirement Taxes High Net Worth FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials More Innovation Information Technology FP500 Podcasts Small Business Lives Told Tails Told Shopping Financial Post Store Obituaries Place a Notice Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place a Classifieds ad Working Profile Settings My Subscriptions Saved Articles My Offers Newsletters Customer Service FAQ News Economy Energy Mining Real Estate Finance Work Wealth Investor FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials HomeFinanceBankingCIBC selling Caribbean division for US$1.6 billion as it refocuses efforts on North American marketShares drop nearly four per cent despite strong second quarter earnings You can save this article by registering for free here. Or sign-in if you have an account.CIBC reported earnings on Thursday. Photo by Annie Sakkab/BloombergCanadian Imperial Bank of Commerce is selling its Caribbean division for US$1.6-billion in a move that will allow it to “reallocate significant capital” toward growing its North American business, the bank’s chief executive said Thursday.Subscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.Subscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountorThe Bank of N.T. Butterfield & Son Ltd. will buy CIBC’s 92 per cent interest in CIBC Caribbean for US$1 billion in cash and 52.1 million common shares, currently valued at US$645 million. Through the deal, CIBC will own a 22 per cent stake in Bermuda-based Butterfield. “The transaction brings together two complementary banks with deep roots and established relationships across the region,” CIBC chief executive Harry Culham told analysts during the bank’s second-quarter earnings call. Breaking business news, incisive views, must-reads and market signals. Weekdays by 9 a.m.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Posthaste will soon be in your inbox.We encountered an issue signing you up. Please try againCIBC beat analysts’ estimates for the quarter as it posted growth across all divisions. Net income was nearly $2.5 billion for the three months ended April 30, up 23 per cent from the same period a year earlier. Net earnings per share were $2.53. Adjusted net income, which excludes non-recurring items, also increased 23 per cent to just shy of $2.5 billion. Adjusted earnings per share came in at $2.54, up from $2.05 a year earlier and above the $2.45 forecast by analysts. CIBC declared a dividend of $1.07 per share, unchanged from the previous quarter and up from $0.97 cents a year earlier. The bank also announced that it is renewing its share buyback program and will repurchase up to 30 million common shares, representing 3.3 per cent of outstanding shares of April 30. While the bank’s overall results were strong, and included a 40 per cent surge in net income in capital markets, analysts pointed to weaker-than-expected growth in other divisions as potential areas of concern for investors.“Although CIBC came in ahead of expectations, the earnings mix may not be what the market prefers to see,” Jefferies Inc. analyst John Aiken said in a note. “Capital markets far exceeded expectations, but this was met with misses in domestic retail and U.S. commercial.” CIBC shares were down more than 4.9 per cent to $151.70 in midday trading in Toronto.Provisions for credit loss (PCLs), the money banks set aside to cover potential loan defaults, were $605 million, unchanged from a year ago and up from $568 million in the first quarter. Chief risk officer Frank Guse said “elevated unemployment and heightened geopolitical tensions” contributed to the bank increasing its PCLs on impaired loans by $28 million from the previous quarter to $548 million, mainly in its Canadian personal and business banking portfolios. “While we are not currently seeing material credit concerns, we continue to monitor the portfolio closely, given the evolving economic environment,” said Guse. “We remain confident in the quality of our credit portfolio and the prudence of our reserves, which positions us well to manage the current debt environment.” The increase was partially offset by lower provisions in U.S. commercial banking and wealth management, which, along with higher revenue, helped net income in CIBC’s American unit grow by $87 million to $260 million. Canadian personal and business banking reported net income of $846 million, up 15 per cent from a year ago, driven by higher revenues and partly offset by higher non-interest expenses and higher PCLs. Canadian commercial banking and wealth management net income grew 12 per cent to $614 million. Higher revenue from global markets, corporate banking and investment banking helped capital markets’ net income surge 40 per cent to $792 million. TD Securities Inc. analyst Mario Mendonca said in a note that it was a “good, not great” quarter, nothing that earnings in CIBC’s Canadian personal and business banking and U.S. commercial and wealth units were weaker than consensus. He said CIBC had “a solid quarter, among best in group, but not as strong as (its) previous quarter.” CIBC’s results were “decent” overall, Bank of Nova Scotia analyst Mike Rizvanovic said in a note, “with clear positives on another strong quarter in capital markets, a sequential (net interest margin) increase at the all-bank level, and clear evidence of expense control.” Join the Conversation This website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.