Canada's CIBC profit miss sends shares to deepest daily dive in 10 years
(This December 5 story corrects seventh paragraph to say income from U.S. business rose, not fell.)
By Nichola Saminather and C Nivedita
(Reuters) - Shares of Canadian Imperial Bank of Commerce <CM.TO> on Thursday posted their biggest daily percentage slide in a decade, after disappointing results including worse-than-expected bad loan provisions.
CIBC reported a 4 percent decline in fourth-quarter profit, and Canada's No. 5 bank by market value set aside C$402 million ($302.2 million) as provisions for bad loans, more than the C$286 million than analysts had expected. That included one impairment of C$52 million related to fraud, executives said on an analyst call..
A company spokeswoman declined to provide further details about the fraud.
CIBC shares fell 5.2% to close at C$108.88 in Toronto, the biggest daily decline since August 2009, wiping out C$2.6 billion in market value.
"Overall we view this as a very weak quarter... particularly given that it was largely a credit-related miss, which we suspect will be concerning to many of the bank’s shareholders," Mike Rizvanovic, an analyst at Credit Suisse, wrote in a note.
CIBC and Toronto Dominion Bank <TD.TO>, Canada's largest bank by assets, were the last of the top six lenders to report. Both missed analyst estimates.
Net income in CIBC's Canadian retail banking business fell 10% to C$601 million from a year earlier. Canadian commercial banking and wealth management earnings were 0.5% lower, while the capital markets unit reported a 12% decline. Profit from CIBC's U.S. unit rose 21%.
Net income attributable to common shareholders, excluding one-off items, fell to C$1.31 billion, or C$2.84 per share the quarter, from C$1.36 billion, or C$3.00 per share a year ago.
Analysts on average had expected C$3.06 per share, according to Refinitiv IBES data.
(Reporting by Nichola Saminather in Toronto and C Nivedita in Bengaluru; Editing by Krishna Eluri)
