Harriet Davies
Editor - Family Wealth Report
30 August 2012
Daily News Analysis
CIBC has reported net income from wealth management of C$76 million ($76.7 million) for the third quarter, up 9 per cent from the same quarter last year.
Revenues from wealth management were “comparable” year-over-year, the firm said, standing at C$401 million. Commissions from equity trading were down but this was offset by income from CIBC’s proportionate share in American Century Investments.
The firm bought a 41 per cent interest in Kansas-based ACI in 2011, buying out JP Morgan. As of the third quarter, CIBC said it had transferred over C$1.8 billion in retail sub-advised funds to ACI.
Meanwhile, it is looking to strengthen its ties with high net worth clients and enhance its distribution capabilities. As such, earlier this month it announced its plan to acquire MFS McLean Budden’s private wealth business, which manages some $1.4 billion in assets for HNW individuals and families, endowments and foundations. The transaction is expected to close in the final quarter of 2012.
For all its businesses, Toronto-listed CIBC reported net income of C$841 million for the third quarter ended July 31, 2012, compared with net income of C$591 million for the same period last year. It announced a dividend increase of 4 cents, to 4.4 per cent per share on common shares, and a purchase for cancellation of around 2 per cent of its outstanding common shares, subject to approval from the exchange.
“CIBC’s solid results in the third quarter reflect broad-based performance across our core businesses,” said Gerry McCaughey, president and chief executive.
