December 2015 Building a strong ... - Financial Servicesclient relationships to accelerate...
Transcript of December 2015 Building a strong ... - Financial Servicesclient relationships to accelerate...
Building a strong, innovative, relationship-oriented bank
December 2015
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Forward Looking Statements
A Note about Forward-Looking Statements
From time to time, we make written or oral forward-looking statements within the meaning of certain securities laws, including in this presentation, in other filings with Canadian securities regulators or the U.S. Securities and Exchange Commission and in other communications. All such statements are made pursuant to the “safe harbour” provisions of, and are intended to be forward-looking statements under, applicable Canadian and U.S. securities legislation, including the U.S. Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, statements made about our operations, business lines, financial condition, risk management, priorities, targets, ongoing objectives, strategies and outlook for calendar year 2015 and subsequent periods. Forward-looking statements are typically identified by the words “believe”, “expect”, “anticipate”, “intend”, “estimate”, “forecast”, “target”, “objective” and other similar expressions or future or conditional verbs such as “will”, “should”, “would” and “could”. By their nature, these statements require us to make assumptions and are subject to inherent risks and uncertainties that may be general or specific. A variety of factors, many of which are beyond our control, affect our operations, performance and results, and could cause actual results to differ materially from the expectations expressed in any of our forward-looking statements. These factors include: credit, market, liquidity, strategic, insurance, operational, reputation and legal, regulatory and environmental risk; the effectiveness and adequacy of our risk management and valuation models and processes; legislative or regulatory developments in the jurisdictions where we operate, including the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations issued and to be issued thereunder, the U.S. Foreign
Account Tax Compliance Act and regulatory reforms in the United Kingdom and Europe, the Basel Committee on Banking Supervision’s global standards for capital and liquidity reform and those relating to the payments system in Canada; amendments to, and interpretations of, risk-based capital guidelines and reporting instructions, and interest rate and liquidity regulatory guidance; the resolution of legal and regulatory proceedings and related matters; the effect of changes to accounting standards, rules and interpretations; changes in our estimates of reserves and allowances; changes in tax laws; changes to our credit ratings; political conditions and developments; the possible effect on our business of international conflicts and the war on terror; natural disasters, public health emergencies, disruptions to public infrastructure and other catastrophic events; reliance on third parties to provide components of our business infrastructure; potential disruptions to our information technology systems and services, including the evolving risk of cyber attack; social media risk;
losses incurred as a result of internal or external fraud; the accuracy and completeness of information provided to us concerning clients and counterparties; the failure of third parties to comply with their obligations to us and our affiliates; intensifying competition from established competitors and new entrants in the financial services industry including through internet and mobile banking; technological change; global capital market activity; changes in monetary and economic policy; currency value and interest rate fluctuations; general business and economic conditions worldwide, as well as in Canada, the U.S. and other countries where we have operations, including increasing Canadian household debt levels and the high U.S. fiscal deficit; our success in developing and introducing new products and services, expanding existing distribution channels, developing new distribution channels and realizing increased revenue from these channels; changes in client spending and saving habits; our ability to attract and retain key employees and executives; our ability to successfully execute our strategies and complete and integrate acquisitions and joint ventures; and our ability to anticipate and manage the risks associated with these factors. This list is not exhaustive of the factors that may affect any of our forward-looking statements. These and other factors should be considered carefully and readers should not place undue reliance on our forward-looking statements. We do not undertake to update any forward-looking statement that is contained in this presentation or in other communications except as
required by law.
Investor Relations contacts:
Geoff Weiss, Senior Vice-President 416 980-5093
Investor Relations Fax Number 416 980-5028
Visit the Investor Relations section at www.cibc.com
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Our Stock & Our Company(1)
CIBC is a leading Canadian-based global financial institution with a
client-focused strategy that creates value for our stakeholders.
OUR STOCK(2)
CM SYMBOL
NYSE/ TSX EXCHANGE
$40B MARKET CAP
1.2M SHARES/DAY
Aa3, A+, AA-
DEBT RATINGS
4.3% YIELD
(1) Presented under IFRS basis. Non-GAAP measures which exclude items of note as referenced in our quarterly Report to Shareholders. (2) As of October 31, 2015 (3) Last 12 months as of October 31, 2015
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OUR COMPANY(3)
~11M CLIENTS
+1,100 BRANCHES
+44K EMPLOYEES
$13.9B REVENUE
$3.6B NET INCOME
$463B TOTAL ASSETS
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2 0 1 6 S t r a t e g y
Corporate Objectives
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Simplifying our Bank Improving process efficiencies for
our clients and for our teams
Focusing on our Clients Culture focused on the needs of
our clients and on being advocates for our clients
Innovating for the Future Adopting technology to enhance
the client experience
Unlock value for reinvestment
Deepening client relationships
Reshape the way our clients bank and transact with CIBC
A strong,
innovative,
relationship
-oriented
bank
Strategy Objectives Our Goal
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Our Business Segments
(1) Last twelve months (as of Q4/15). Net Income includes $224 MM loss from Corporate and Other. Results are adjusted for items of note.
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THREE MAIN SEGMENTS (FY2015; Adjusted Net Income of $3.8) (1)
65% Retail and Business Banking
27% Capital Markets
14% Wealth Management
-6% Corporate & Other
65%
14%
27%
-6%
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Strong Performance….
Diluted Adjusted Earnings / Share(1) ($)
Basel III Common Equity Ratio (%)
5 Sound risk management is a key element of CIBC’s strategy
9.4
10.3 10.8
9.3 9.9
10.3
2014 2013
Peer Average CM
9.458.94
8.65
7.987.57
5.7%
2015 2014 2013 2012 2011
(1) Presented under IFRS basis. Non-GAAP measures which exclude items of note as referenced in our quarterly Report to Shareholders.
2015
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Adjusted Return on Equity (%)
Dividend Yield (%)
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…. and attractive returns to shareholders(1)
4.3
3.8
4.3
4.64.7
4.3
3.73.9
4.34.0
2015 2014 2013 2012 2011 2015 2014 2013 2012 2011
Peer Average CM Peer Average CM
Leader in ROE
(1) Presented under IFRS basis. Non-GAAP measures which exclude items of note as referenced in our quarterly Report to Shareholders.
19.920.9
22.922.8
24.8
15.816.917.2
18.519.1
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Cash Earnings >$3.6B Annually
7 Strong Capital Generation flexibility
Organic Growth
High priority
Focused on operational investment
Deeper client relationships
Acquisitions
Selective acquisitions to support strategic priorities
Consistent with defined risk appetite
Return to Shareholders
Moving to higher end of 40-50% dividend payout ratio
Share repurchase program in place (up to 2% of outstanding)
D i s c i p l i n e d C a p i t a l D e p l o y m e n t
Reinvestment / Return to Shareholders
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ENHANCING CLIENT EXPERIENCE ACCELERATING PROFITABLE REVENUE GROWTH
MODERN CONVENIENCE BANKING • Easy • Personalized • Flexible
STRATEGIC RELATIONSHIPS
INNOVATION
Retail & Business Banking
Delivering a better experience for our clients
Strategic Objectives:
Our Strategy to Win:
Growth Accelerators:
Foundation – continued investment in our people 8
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Retail & Business Banking: Key Priorities
Delivering on consumers’ preferences for a banking experience that is easy, personalized and flexible
2 Personalized
3 Flexible
1 Easy
KEY PRIORITIES OBJECTIVE
• Streamline / simplify / automate
processes
• Digitization of information
• Product & documentation simplification
Improve market position
• 360° view of client
• Differentiated experience based on
client value and preferences
• Over-index growth from Mass Affluent
and Commercial Banking
Differentiated position in market Leadership in
Mass Affluent
• Drive digital sales growth
• Enhance self-serve capabilities
• Channel integration
• Payments innovation
Leadership in emerging channels and banking
innovation
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R e t a i l a n d B u s i n e s s B a n k i n g
Making good progress(1)
Adjusted Net Income ($ billions)
Interest Earning Assets ($ billions)
Loan Loss Ratio (%)
(1) Presented under IFRS basis. Non-GAAP measures which exclude items of note as referenced in our quarterly Report to Shareholders. (2) Last Twelve Months.
2.20 2.38 2.50
0.22
2015 2014
0.04
2013
0.440.38
0.29
2015 2014 2013
156 162 172
2015 2014 2013
217 220 231
2015 2014 2013
Deposits ($ billions)
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ex Aero
Aero
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KEY PRIORITIES OBJECTIVE
• Continue to develop deep client
relationships
• Focus on eliminating platform gaps
• Build core Canadian Commerce
activities
Consistent, sustainable earnings
• Extend core business
• North American energy &
infrastructure build out
Higher long-term growth & diversification
• Enterprise-wide client management
• Align Private Banking & Corporate
contacts
• Investments in cash management
& other deposit gathering initiatives
New revenue & relationship opportunities
2 Client Capabilities Outside of Canada
3 Collaboration &
Innovation Across CIBC
1 Client Leadership
in Canada
Capital Markets: Key Priorities
Developing deep client relationships in Canada, growing execution capabilities in the U.S., and creating innovative solutions for Retail and Wealth clients.
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C a p i t a l M a r k e t s
Making good progress(1)
Average Loans and Acceptances ($ billions)
Average Value at Risk ($ millions)
(1) Presented under IFRS basis. Non-GAAP measures which exclude items of note as referenced in our quarterly Report to Shareholders. (2) Last Twelve Months.
Adjusted Net Income ($ millions)
Adjusted Efficiency Ratio
(%)
21.625.0
30.0
2015 2014 2013
4.6
3.54.0
2015 2014 2013
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52.0 49.9 50.0
2013 2014 2015
817 913
1,012
2014 2015 2013
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KEY PRIORITIES OBJECTIVE
• Elevate our integrated Wealth offer
• Continue fee-based conversion
• Enhance investment capabilities
Improve and differentiate market
position
• Attract net new High Net Worth clients
• Grow self-directed business
• Elevate Asset Management
Organic growth
• Grow earnings contributions to >15%
• Target US Private Banking, Wealth
Management, Asset Management
Inorganic growth
2 Attract New
Clients
3 Strategic
US Acquisitions
1 Enhance
Client Experience
Wealth Management: Key Priorities
Capitalizing on client demand shifts, enhancing client experience, and advancing CIBC’s overall growth, diversification and funding objectives.
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W e a l t h M a n a g e m e n t
Making good progress(1)
Adjusted Net Income ($ millions)
Contribution to CIBC’s Earnings
(%)
Assets Under Administration ($ billions)
Mutual Funds ($ billions)
(1) Presented under IFRS basis. Non-GAAP measures which exclude items of note as referenced in our quarterly Report to Shareholders.
389486
538
2015 2014 2013
226289 305
2015 2014 2013
66.777.0 84.2
2015 2014 2013
1113 14 15
2013 Target 2015 2014
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Summary
Retail & Business
Repositioned to focus on client relationships to accelerate profitable revenue growth and enhance the client experience
Wealth Management
Targeting 15%+ NIAT contribution in the
medium term through organic growth and strategic
acquisitions
Wholesale Banking
De-risked with plans to grow with our clients’ global needs for lending, advisory services and capital markets products
Committed to delivering sustainable shareholder value 15
Industry leading Return on Equity, Capital Strength, and Dividend Yield
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CIBC Contacts
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GEOFF WEISS, SENIOR VICE-PRESIDENT
Email: [email protected]
Phone: +1 416-980-5093
SELL-SIDE ANALYSTS, CONTACT:
JASON PATCHETT, SENIOR DIRECTOR
Email: [email protected]
Phone: +1 416-980-8691
INSTITUTIONAL INVESTORS, CONTACT:
ALICE DUNNING, SENIOR DIRECTOR
Email: [email protected]
Phone: +1 416-861-8870