Report to Shareholders for the Third Quarter, 2000

Transcription

1 Report to Shareholders for the Third Quarter, 2000 Chairman s Message Dear Shareholder: September 7, 2000 Earnings I am pleased to report that CIBC s third quarter earnings were $601 million, up 53% from the results achieved in the same quarter a year ago and down 11% from the record results reported in the previous quarter. Earnings per share were $1.47 and return on equity was 23.8%. These results reflect solid performance in all business lines, tempered by less robust capital markets. During the quarter, CIBC realized an after-tax gain of $221 million on the sale of 10 million shares of Global Crossing Ltd. At the end of the quarter, the market value of our total securities portfolio exceeded book value by $2.8 billion. Our balance sheet continues to be strong. Our Tier 1 capital ratio improved to 8.9% and our total capital ratio improved to 12.0%, exceeding our targets. During the quarter, we repurchased 0.8 million shares at an average price of $42.15 per share under a normal course issuer bid that started December 15, Although our gross impaired loans increased during the quarter, our allowance for credit losses still exceeds our impaired loans. We increased the full-year estimate of the specific provision for credit losses by $150 million, $75 million of which was recorded in the third quarter. Growth CIBC is seeking new sources of sustainable earnings in order to deliver long-term value to our shareholders. One of our most significant opportunities for revenue growth lies in e-commerce, particularly e-finance solutions. Electronic Commerce The creation of Amicus brings together all our co-branded electronic banking businesses. Under the Amicus umbrella, we now have 374,000 e-banking customers and are acquiring 17,000 more each month. In addition to Amicus customers, we have 2.3 million telephone banking and 700,000 PC Banking customers. One of our key e-commerce strategies is customer acquisition through partnerships with leading brand retailers. During the quarter, we announced a new alliance with Safeway Inc., one of the largest grocery chains in the United States with more than 1,400 stores and access to 19 million customers. Later this year, we will start providing electronic banking services to these customers under the banner Safeway SELECT Bank. Safeway is our third strategic electronic banking alliance with a major grocery retailer. It follows on the successful implementation of President s Choice Financial, with Loblaw Companies Limited in Canada, and Marketplace Bank, with Winn-Dixie Stores Inc. in the southeastern United States. In-store banking services are now delivered at 196 pavilions. This quarter, we announced that Yahoo! Inc. had selected CIBC to provide Yahoo! PayDirect U.S. customers with a quick and easy way to request, send and make payments over the Internet, for a full online person-to-person payment solution. CIBC World Markets Our U.S. investment banking operation continues to grow. During the quarter, CIBC World Markets led and co-managed equity offerings amounting to US$4.8 billion, up from US$3.0 billion in the same period last year. As well, we were the adviser of record in merger and acquisition transactions worth US$43.0 billion, up from US$5.9 billion a year ago. We also announced an initiative between Microsoft Canada and our merchant bank to invest up to $50 million in independent software companies to foster development and innovation in one of Canada s fastest growing industries. Wealth Management The growth in our wealth management client base is also robust, with $165 billion in assets under administration for individuals, an increase of 19% over July 31, Retail and Small Business Banking To deliver the best possible service to our retail and small business customers, we are streamlining our products and investing in technology and training. As part of a major technology upgrade in the branch network, 5,000 new personal computers and servers were installed. Also during the quarter, the first groups graduated from our new Retail University, which provides in-class and in-branch training and will be available nationally to front-line employees starting in the fourth quarter. For small business customers, in September we are launching bizsmart, a strategic alliance with other leading suppliers to Canadian small business to provide the first no-fee, online banking offer (bizsmart.com) to this customer segment.

2 Focus CIBC continues to exit businesses that do not have a sustainable competitive advantage. This quarter we announced agreements to sell our property and casualty insurance companies and CIBC Suisse S.A., our Swiss private banking operations. To optimize capital productivity, we are reallocating resources to higher-return businesses and reducing risk-weighted assets. During the quarter, we reduced risk-weighted assets related to our non-core loan portfolio by $1.2 billion, which represents a 14% reduction. Performance Against Objectives Return on equity, earnings growth and capital strength exceeded our targets this quarter. Our share price closed at $42.40 compared to $31.70 at October 31, We have eliminated $320 million, on an annualized basis, from our operating expense base and we are on track to meet our $500 million target in the fourth quarter. Financial Targets Measurement Year-to-date Performance Shareholder Return Best total return of Canadian banks over the next 3 years Up 37% versus bank index of 20% ROE 18% by % (1) Earnings Growth Fully diluted EPS growth rate of 15% per year $3.75 (1), up 67% from 1999 YTD EPS of $2.24 Efficiency Non-interest expenses to revenue ratio of 60% by % (1) Capital Strength 7.5% 8.5% (Tier 1) 8.9% 10.5% 11.5% (Total Capital) 12.0% (1) Normalized for the gain on sale of a portion of our real estate holdings. Last year, we set four priorities for achieving sustainable growth: establish a performance culture; reduce earnings volatility; improve efficiency, and grow revenues. To support these priorities, we have reorganized the bank, set financial benchmarks, increased financial disclosure and more directly linked compensation to performance. Capital and expenses have been fully allocated to our business units and we have established a rigorous process to measure and review performance. While returns have been solid this year and capital remains strong, we continue to reduce expenses. We have made progress on many fronts, and I d like to thank our customers and everyone on the CIBC team for an excellent quarter. John S. Hunkin Chairman and Chief Executive Officer, CIBC A NOTE ABOUT FORWARD-LOOKING STATEMENTS This report contains forward-looking statements about the operations, objectives, targets and strategies of CIBC. Forward-looking statements may be identified by the words believe, expect, anticipate, intend, estimate and other similar expressions. These statements are subject to risks and uncertainties. Actual results may differ materially due to a variety of factors, including legislative or regulatory developments, competition, technological change, global capital market activity, interest rates and general economic conditions in Canada, North America or internationally. This list is not exhaustive of the factors that may affect any of CIBC s forward-looking statements. These and other factors should be considered carefully and readers should not place undue reliance on CIBC s forward-looking statements. For more information please contact: Kathryn A. Humber, CFA, Senior Vice-President, Investor Relations, (416) Robert E. Waite, Senior Vice-President, Corporate Communications and Public Affairs, (416) Wendy Dey, Director, Corporate Communications, (416) CIBC Third Quarter Report 2000

3 FINANCIAL AND OPERATIONS COMMENTARY OVERVIEW Net Income CIBC s net income for the third quarter of 2000 was $601 million, down $75 million or 11% from the record earnings of the previous quarter and up $207 million or 53% from the third quarter of Basic earnings per share were $1.47 for the quarter, down from $1.64 in the prior quarter and up from $0.89 in the third quarter of Return on equity was 23.8% for the quarter, compared with 28.5% in the prior quarter and 15.4% in the third quarter of Net income for the quarter was solid, but down from the prior quarter, due mainly to lower brokerage and investment banking volumes and an increase in the specific provision for credit losses. Net income benefited from a $221 million (Q2: $176 million) after-tax gain on the sale of a portion of our investment in Global Crossing Ltd. The second quarter also included a $128 million after-tax gain on the sale of part of CIBC s real estate portfolio and an $89 million after-tax increase in the general provision for loan losses. Excluding these items, CIBC s net income was $380 million, compared with $461 million in the second quarter. Net income for the nine months ended July 31, 2000 was $1,728 million, up $707 million or 69% from the same period in Year-to-date net income was $1,203 million after adjusting for the $397 million after-tax gains on the sales of part of our investment in Global Crossing Ltd. and the $128 million after-tax gain on the sale of real estate. This represents an increase of $254 million or 27% from $949 million for the same period in 1999, after adjusting for a $130 million after-tax gain on the sale of securities, net of write-downs and a $58 million restructuring charge. Basic earnings per share were $4.17 and return on equity was 23.5% for the first nine months, versus $2.27 and 13.5% in Revenue Revenue totaled $3,054 million on a taxable equivalent basis (TEB). Revenue was down $305 million from the second quarter, which included $182 million from the sale of part of CIBC s real estate portfolio, and was up $156 million from the third quarter of Revenue remained strong across all business lines. While Wealth Management and CIBC World Markets revenues were affected by the decline in equity market volumes in the quarter compared to volumes earlier in the year, overall performance exceeded that of the third quarter of Expenses Non-interest expenses were $1,996 million, down $100 million from the prior quarter and up $7 million from the third quarter of 1999 after adjusting for the $87 million restructuring charge in that quarter. The efficiency ratio was 65.4% for the quarter, versus 66.0% in the prior quarter, after excluding the real estate gain. The efficiency ratio also improved from 68.6% in the third quarter of 1999, excluding the restructuring charge from that quarter. In late fiscal 1999, a comprehensive program was announced to reduce base operating expenses by $500 million on an annualized basis by the fourth quarter of CIBC is on track to achieve this target. Progress is measured against a base using second quarter 1999 expense levels, excluding certain revenue-related expenses (incentive compensation, commissions and other variable costs) and new investment in strategic growth businesses. Annualized savings based on third quarter results were $320 million. CIBC had 45,267 full-time equivalent employees at July 31, Excluding 458 added since July 31, 1999 to support strategic initiatives, CIBC s fulltime equivalent employees are down 2,592 from July 31, Full-time equivalent employees were up 433 from the end of the prior quarter, excluding 252 added in the quarter in support of strategic initiatives. The increase was due mainly to seasonal demands, met in part by summer students. The pre-tax restructuring charge of $426 million taken in 1999 to support the cost reduction program was drawn down by $45 million in the quarter. At July 31, 2000, the unused balance of the provision totaled $171 million (see table on page 13). Assets Total assets were $265.8 billion at July 31, 2000, down $1.6 billion from the prior quarter due to a $4.7 billion decrease in interbank deposits, which more than offset a $2.7 billion increase in trading securities. Assets were up $4.0 billion from the third quarter of 1999 due to increases in residential mortgages and consumer, credit card and small business loans, partially offset by a significant decrease in reverse repurchase agreements. CIBC increased its full-year estimate of the specific provision for credit losses by $150 million, $75 million of which was recorded in the third quarter. The increase relates to higher volumes in card products and a decline in the status of certain loans in the health care, trades and services, and transportation sectors. At quarter end, the total allowance for credit losses was $2.0 billion, up from $1.9 billion at the end of the prior quarter and up from $1.8 billion at the end of the third CIBC Third Quarter Report

4 quarter of Gross impaired loans were $1.8 billion at quarter end, up $0.2 billion from both the prior quarter and the third quarter of Net impaired loans were negative $170 million, compared with negative $319 million at the end of the previous quarter and negative $200 million at the end of the third quarter of 1999, as the total allowance for credit losses continued to exceed gross impaired loans. During the quarter, CIBC announced the sale of its property and casualty insurance companies, The Personal Insurance Company of Canada and CIBC General Insurance Company Limited. CIBC also announced an agreement to sell CIBC Suisse S.A., the full-service Swiss private banking operations within CIBC s global private banking and trust business. These sales are subject to regulatory approval and are expected to close in the fourth quarter. Capital Management CIBC s total capital for regulatory purposes was $16.3 billion, up $0.4 billion from the prior quarter. Tier 1 and total regulatory capital ratios were 8.9% and 12.0% respectively, at July 31, 2000, up from the second quarter ratios of 8.5% and 11.6%. Shareholder Value CIBC s common share price closed the quarter at $42.40, up 9% from the prior quarter and up 19% from July 31, Book value per share was $25.21, up 5% from the prior quarter and up 9% from $23.19 at July 31, Under CIBC s normal course issuer bid that started December 15, 1999, CIBC purchased for cancellation 0.8 million shares during the quarter at an average price of $42.15 per share. As at July 31, 2000, 18.9 million shares have been purchased at an average price of $37.40 per share. FINANCIAL AND OPERATIONS COMMENTARY SEGMENTED CIBC s management structure has four business lines Electronic Commerce, Technology and Operations; Retail and Small Business Banking; Wealth Management; and CIBC World Markets. These business lines are supported by four functional groups Treasury and Balance Sheet Management (TBM); Risk Management; Administration; and Corporate Development. Electronic Commerce, Technology and Operations (Electronic Commerce) Electronic Commerce comprises mortgages, card products, insurance and the development of leading-edge technology businesses, either directly or through electronic banking alliances, to generate new revenue opportunities. The group also manages CIBC s operations and technology function, the payments business (chequing, saving and current accounts) and electronic banking services (telephone banking, personal computer/internet banking and ABMs), the revenues and expenses of which are fully allocated. Net income for the quarter was $59 million, up $1 million from the prior quarter and down $25 million from the third quarter of Net income was $171 million for the first nine months of the year, a decrease of $51 million from the same period in Increased spending on strategic initiatives contributed to the net income decline. Although the specific loan loss provision in cards was up, this was more than offset by increased revenues and volume growth in cards. Revenue totaled $419 million, an increase of $29 million from the second quarter and a decrease of $21 million from the same quarter last year. Revenue for the first nine months was $1,217 million, up $7 million from the same period last year. Mortgages include both residential and commercial mortgages. Revenues were $81 million in the quarter, up $3 million from the prior quarter due to higher volumes. The third quarter of 1999 included a gain on the sale of bonds and higher margins. Cards comprise a portfolio of credit and debit cards as well as a merchant business. Revenues were $240 million in the quarter, up $22 million from the prior quarter due mainly to 16% growth in purchase volumes and a 5% increase in balances under administration. Revenues were up $43 million from the third quarter of 1999 due to 23% growth in purchase volumes and a 24% increase in balances under administration. Insurance provides creditor and property and casualty insurance products. Revenues were $46 million in the quarter, up $4 million from the prior quarter due to lower claims provisions. Revenues were down $14 million from the third quarter of 1999 due primarily to exiting direct life insurance products. Other includes electronic and self-service banking, allocation of a portion of treasury revenues and INTRIA third-party technology services. Revenues were $52 million in the quarter, unchanged from the prior quarter and down $27 million from the third quarter of 1999 primarily due to a decline in treasury revenues. 4 CIBC Third Quarter Report 2000

5 Non-interest expenses were $285 million, up $2 million from the previous quarter and up $16 million from the third quarter of Non-interest expenses for the first nine months were $861 million, up $108 million from the same period in The increase from 1999 is primarily due to growth in strategic areas, notably President s Choice Financial, Marketplace Bank and the recently announced Safeway SELECT Bank. A net increase in the number of full-time equivalent employees versus the prior quarter resulted from the need to support growth in strategic areas, additional items processing related to increased volumes and vacation relief. The costs associated with items processing is allocated to the other business lines. Developments and progress against targets include: CIBC expanded its electronic banking operations into the western United States through the formation of Safeway SELECT Bank, an alliance with Safeway Inc., a leading U.S. supermarket retailer. The first pavilions will open in the fall. During the quarter, Amicus was formed to consolidate CIBC s co-branded electronic banking businesses. Alliances under the Amicus umbrella include President s Choice Financial, Marketplace Bank and Safeway SELECT Bank. Yahoo! Inc. selected CIBC to provide Yahoo! PayDirect U.S. customers with a quick and easy way to request, receive, send and make payments over the Internet for a full online person-to-person payment solution. The service is currently being offered on Yahoo! Auctions. The Amicus brand will appear on this site and the co-branding pages within Yahoo! PayDirect. As a result, the Amicus brand will receive extensive exposure in the U.S. market. CIBC announced the sale of the property and casualty insurance subsidiaries, subject to regulatory approval. This sale is expected to close in the fourth quarter and generate a gain. In addition, CIBC completed an agreement wherein Canada Life will provide life and disability insurance coverage for mortgage and personal loans. This will enable CIBC to focus on the distribution and marketing of creditor insurance. An agreement was completed with National Bank of Canada to join CIBC s Merchant Edge program as the new MasterCard alliance member with CIBC providing services to National Bank MasterCard merchants. CIBC introduced VeriSign OnSite service, a fully managed security service for Canadian companies that uses best-practice technology to secure e-commerce applications and communications over the Internet. Target Double the number of electronic banking customers (Amicus) within one year The number of electronic banking customers has grown 62% from 231,000 to 374,000 in the past nine months through alliances with Loblaw Companies Ltd. (President s Choice Financial) and Winn-Dixie Stores Inc. (Marketplace Bank). Target Increase sales of CIBC s banking products through electronic channels by 50% within one year Year-to-date sales volumes through telephone banking and PC Banking are up 37% from the first nine months of Target Change business processes that are not serving customers well or are exceeding industry cost benchmarks CIBC continuously improves business processes. For example, the process for opening a personal account was streamlined, resulting in a 15% time savings for our clients, as well as time and cost savings for CIBC. Subsequent to quarter end, CIBC announced a new telephone banking customer contact centre in Fredericton to service customers nationally. Construction of a temporary facility has started, with an expected completion date of December, Retail and Small Business Banking Retail and Small Business Banking comprises a fullservice banking operation offering customers lending, deposit and investment products and other banking services through an extensive branch network in Canada and the West Indies, and through electronic channels managed by the Electronic Commerce business line (such as ABMs, telephone banking, debit card and Internet banking). The retail, small business and student loan portfolios are included within the Retail and Small Business Banking business line. Net income for the quarter was $89 million, up $5 million from the prior quarter and up $36 million from the third quarter of 1999, excluding a $4 million after-tax asset write-down in the third quarter and a $7 million after-tax branch restructuring charge in The write-down relates to a branch property offered for sale. Net income was $264 million for the first nine months of the year, an increase of $59 million or 28% from the same period in 1999, after adjusting for the asset write-down and the restructuring charge, as well as a $21 million after-tax investment gain in the second quarter of Solid revenue growth and expense controls contributed to the earnings improvement. Revenue totaled $659 million, an increase of $29 million from the second quarter and an increase of $47 million from the same quarter last year, after adjusting for the asset write-down. Revenue for the first nine months was $1,935 million, up $91 million or 5% from the same period last CIBC Third Quarter Report

6 year after adjusting for the asset write-down in the current quarter and the investment gain in Higher business volumes, combined with better interest margins on the deposit business, contributed to revenue increases. Retail banking supports the individual customer. Revenues are earned from sales and service fees. Revenues were $232 million in the quarter, up $20 million or 9% from the prior quarter due to business growth in loans, deposits, and investments, and improved deposit interest margins. Revenues were up $31 million or 15% from the third quarter of 1999, reflecting 9% growth in business volumes from that period. Small business banking supports small owner-operated businesses, including owners personal holdings. Revenues are earned from sales and service fees. Revenues were $202 million in the quarter, up $13 million or 7% from the prior quarter and up $39 million or 24% from the third quarter of 1999 due to continued growth in the loan, deposit, and investment business. Business volumes across all products have increased 14% from the third quarter of West Indies is a full-service banking operation servicing all customer segments through a branch network and electronic delivery channels. Revenues are earned on net interest spreads and sales and service fees. Revenues were $70 million in the quarter, up $4 million or 6% from the prior quarter due to continued growth in business activity and favourable foreign exchange rates. Revenues were up $11 million or 19% from the third quarter of 1999 mainly due to volume growth. Lending products comprise personal (including student loans), small business and agricultural lending portfolios. Revenues are earned through net interest spreads and service fees. Revenues were $155 million in the quarter, comparable with the prior quarter, and down $2 million from the third quarter of Revenues were down from 1999 as lower interest margins in 2000 offset the impact of higher average loan volumes, which were up $1.2 billion from the same period last year. Other consists primarily of the allocation of a portion of treasury revenues. Excluding the asset write-down of $6 million pre-tax, revenues were down $9 million from the prior quarter and down $32 million from the third quarter of 1999 due primarily to lower treasury revenues. Non-interest expenses were $467 million, up $27 million from the previous quarter and up $15 million from the third quarter of 1999, after excluding the $13 million pre-tax branch restructuring charge in The increase from the previous quarter is due mainly to higher noncredit losses and increased spending on technology and training. Non-interest expenses for the first nine months were $1,353 million, up $22 million or 2% compared to the same period in 1999, after excluding the $13 million branch restructuring charge. Full-time equivalent employees were down 865 from the same period last year, but up 412 from the previous quarter due to seasonal fluctuations, including the summer student program. Developments and progress against targets include: CIBC s five-year student loan contract with the federal government has expired and CIBC will no longer lend directly to students. A transitional agreement is in place until March, 2001, while CIBC continues to work with the federal government on a new program. Provincial student loan programs have also changed. CIBC will continue to participate in these programs by leveraging our partnership with EDULINX Canada Corporation to service the provincial student loan portfolios, but with a shift in the risk allocation from CIBC to the provincial governments effective August 1, Bizsmart, our new e-banking and e-commerce offer for small business customers will be launched in the Greater Toronto Area in September and in other urban centres in fiscal Bizsmart provides the first no-fee, everyday banking offer for small business in Canada. More information is available at bizsmart.com. The first two phases of a four-phase major branch technology upgrade program are substantially completed. This includes the installation of over 5,000 new personal computers and servers in the branch network along with other enhancements that provide our employees with the most current technology available to better serve our customers. Our investment will approach $100 million by year end with additional investment to be made in The Retail banking group introduced the Retail University to move us toward our goal of improving customer loyalty and enhancing employee capability. This learning and orientation program provides both in-class and in-branch training. About 1,500 graduates are expected to complete the program annually. Target Grow small business loans by 15% a year Small business loans grew 15% from the third quarter of Year-to-date growth is 16% on an annualized basis. Target Improve customer loyalty by 10% by 2002 Customer loyalty ratings generated internally have shown a 2% increase since the end of fiscal 1999 for the Retail and Small Business sectors. Annual external customer loyalty ratings for CIBC will be available in the fourth quarter. Target Become No.1 bank for small business customers by 2002 The introduction of bizsmart is fundamental to achieving this goal. 6 CIBC Third Quarter Report 2000

7 Wealth Management Wealth Management is a leader in helping individual clients achieve their financial goals through a sales force of more than 3,000 financial professionals. These professionals deliver an array of investment products and services including: full-service brokerage (reported in CIBC World Markets in 1999), discount brokerage, a full range of mutual funds, GICs, global private banking and trust, investment management services, and a full range of credit services. Net income for the quarter was $86 million, down $29 million from the prior quarter and up $36 million from the third quarter of Net income was $342 million for the first nine months of the year, an increase of $165 million from the same period in 1999, reflecting growth in the client base as well as favourable market conditions. Revenue totaled $636 million, a decrease of $76 million from the second quarter, reflecting a return to more normal market conditions. Revenue was up $91 million from the same quarter last year. Revenue for the first nine months was $2,110 million, up $430 million from the same period in Higher revenue resulted primarily from favourable market conditions and volumes, as well as growth in our client base. Imperial Service offers a financial advisory service for CIBC s high-value clients. Specially trained financial advisers support the financial planning and product fulfilment needs of these clients. Revenues were $161 million in the quarter, up $12 million from the prior quarter. Revenues were up $11 million from the third quarter of Private client investment and asset management generates fees and commissions from full-service retail brokerage providing equity and debt investments, mutual fund products, asset management service and advisory and financial planning services to individuals. Revenues were $309 million in the quarter, down $70 million from the prior quarter due to more normal market conditions relative to those in the previous quarter. Revenues were up $45 million from the third quarter of Year-to-date revenues were up $296 million or 36% from the same period in 1999, in part reflecting trading volume increases of 39% for the TSE and 116% for the NYSE over the same period. Notwithstanding the year-to-date volume increase, volumes in the third quarter are down from those experienced in the first half of the year. Global private banking and trust provides a comprehensive range of global solutions, including investment management, trusts, private banking and global custody to meet the financial management needs of individuals, families and corporations with significant financial resources. Revenues were $30 million in the quarter, down $3 million from the prior quarter and comparable to the third quarter of Wealth products includes mutual funds, investment management services, online and discount brokerage services and GICs. These investment products are developed and distributed to retail and small business banking services and Imperial Service customers. Revenues were $128 million in the quarter, down $11 million from the prior quarter and up $50 million from the third quarter of 1999, largely due to discount brokerage volume growth. Year-to-date discount brokerage trading volumes have increased 122% from 1999 and discount brokerage assets under administration have grown 44% from the beginning of the year. Other consists primarily of the allocation of a portion of treasury revenues. Revenues were $8 million in the quarter, down $4 million from the prior quarter and down $16 million from the third quarter of 1999 due to lower treasury revenues. Non-interest expenses were $508 million, down $31 million from the previous quarter and up $24 million from the third quarter of Non-interest expenses for the first nine months were $1,587 million, up $138 million from the same period in Fluctuations in non-interest expenses resulted primarily from revenue-related variable compensation. Overall, full-time equivalent employees declined from both the prior quarter and the third quarter of 1999 due to realignment of the Imperial Service sales force. Developments and progress against targets include: CIBC continues to rank first among banks in mutual fund net sales year-to-date, with $1.1 billion. A select group of CIBC s branch-based financial advisers in the Greater Toronto Area are part of a pilot project to roll out CIBC s enhanced capability to advise on and sell third-party mutual funds. The discount brokerage business improved the quality of customer service through online and telephone brokerage services. Investments in people and technology continued to increase the capacity, reliability and response times of our telephone and online delivery systems. In the third quarter, CIBC agreed to sell CIBC Suisse S.A. to Crédit Agricole Indosuez, a subsidiary of the Crédit Agricole group, a French bank. This sale is anticipated to generate a gain in the fourth quarter. Target Increase assets under administration by 10% within one year Assets under administration (excluding international assets administered for institutional clients) were $165 billion at the end of the third quarter, an increase of 19% from July 31, Target Maintain a leadership position in index mutual funds by growing assets by 25% Assets within the index mutual funds were $3.6 billion, up 76% from the third quarter of CIBC has the largest retail index asset base in Canada. CIBC Third Quarter Report

8 CIBC World Markets CIBC World Markets has a broadly based, North American investment banking capability, providing integrated financial solutions to corporate, institutional and government clients. CIBC World Markets includes commercial banking activities (reported under Personal and Commercial Bank in 1999). Net income for the quarter was $386 million, down $5 million from the prior quarter and up $120 million from the third quarter of Earnings in the quarter reflected the sale of a portion of our investment in Global Crossing Ltd., partially offset by a $30 million after-tax increase in the specific allowance for credit losses. Net income was $979 million for the first nine months of the year, an increase of $501 million from the same period in Revenue totaled $1,291 million, a decrease of $108 million from the second quarter and a decrease of $12 million from the same quarter last year. Revenue for the first nine months was $3,629 million, up $622 million from the same period in Capital markets operates trading, sales and research businesses serving institutional, corporate and government clients across North America and around the world. Revenues were $346 million in the quarter, down $108 million from the prior quarter largely due to reduced equity business activity. Revenues were up $78 million from the third quarter of 1999 due to the strong markets that prevailed throughout most of the current year-to-date. Investment banking and credit products provides advisory services and underwriting of debt, credit and equity for corporate and government clients across North America and around the world. Revenues were $382 million in the quarter, down $129 million from the prior quarter and down $110 million from the third quarter of Third quarter revenues were down due to decreased deal flow activity in Canada and weakness in leveraged finance markets. Merchant banking makes investments to create, grow and recapitalize companies across a variety of industries. Revenues were $420 million in the quarter, up $75 million from the prior quarter and down $10 million from the third quarter of Revenues in the quarter were driven primarily by a $383 million (Q2: $314 million) pre-tax gain on the disposal of a portion of our investment in Global Crossing Ltd. Revenues in the third quarter of 1999 included a $424 million pre-tax gain relating to Global Crossing Ltd., partially offset by write-downs on investments in The Loewen Group and Newcourt Credit Group Inc. Commercial banking originates financial solutions centered around credit products for medium-sized businesses in Canada. Revenues were $117 million in the quarter, up $2 million from both the prior quarter and the third quarter of Other includes the allocation of a portion of treasury revenues; CEF Capital, an affiliated Asian merchant bank holding company; strategic merchant banking investments; and other revenues not directly attributed to the main businesses listed above. Revenues were $26 million in the quarter, up $52 million from the prior quarter and up $28 million from the third quarter of Revenues in the prior quarter included the write-down of certain equity investments. Non-interest expenses were $701 million, down $84 million from the prior quarter and down $50 million from the third quarter of 1999, after adjusting for a $65 million restructuring charge in that quarter. Non-interest expenses for the first nine months were $2,102 million, up $126 million from the same period in 1999, after adjusting for restructuring. The increase in expenses was primarily due to variable compensation associated with higher revenues. Full-time equivalent employees were down 351 from the third quarter of 1999 and up slightly from the prior quarter due to seasonal hiring. Developments and progress against targets include: CIBC World Markets completed several major transactions during the quarter including: acted as lead manager on the sale of 7.7 million JDS Uniphase Corp. common shares held by Furukawa Electric Co. Ltd.; advised JDS Uniphase on the largest technology acquisition on record, at US$41.0 billion; and, completed a 11 billion securitization of consumer instalment loans for EIWA Co. Ltd., a major Japanese consumer company. Year-to-date, the U.S. operations of CIBC World Markets led and co-managed 97 equity offerings for an aggregate volume of US$16.0 billion, up from 60 equity offerings for an aggregate volume of US$8.1 billion during the same period in During the third quarter, aggregate lead and co-managed volume was US$4.8 billion, up from US$3.0 billion for the same period in In addition, CIBC World Markets was the adviser of record for US$43.0 billion worth of merger and acquisition transactions, up from US$5.9 billion during the same period in The equity structured products business within capital markets, a hybrid, proprietary and client business that employs technology and human capital to manage trading strategies in equity markets, has grown significantly. Revenues for the nine months ended July 31, 2000 are up substantially from the same period in Target Generate a 15% 20% return on equity Return on equity for the quarter was 34.7%, contributing to a year-to-date return of 30.3%. 8 CIBC Third Quarter Report 2000

9 SEGMENTED INCOME STATEMENT Retail & Small CIBC Electronic Business Wealth World Corporate CIBC Unaudited, $ millions, for the three months ended Commerce Banking Management Markets and Other (1) Total Jul. 31, 2000 Net interest income (TEB) (2) $ 581 $ 265 $ 145 $ 57 $ 41 $ 1,089 Non-interest income , ,965 Intersegment revenue (3) (480) Total revenue (TEB) (2) , ,054 Non-interest expenses ,996 Restructuring charge Provision for credit losses Net income before taxes Income taxes and non-controlling interests Net income (loss) $ 59 $ 89 $ 86 $ 386 $ (19) $ 601 Apr. 30, 2000 Net interest income (TEB) (2) $ 532 $ 269 $ 151 $ 138 $ 20 $ 1,110 Non-interest income , ,249 Intersegment revenue (3) (423) Total revenue (TEB) (2) , ,359 Non-interest expenses ,096 Restructuring charge Provision for credit losses (4) 292 Net income before taxes Income taxes and non-controlling interests (1) 295 Net income $ 58 $ 88 $ 115 $ 391 $ 24 $ 676 Jul. 31, 1999 Net interest income (TEB) (2) $ 553 $ 237 $ 160 $ 222 $ (1) $ 1,171 Non-interest income ,025 (8) 1,727 Intersegment revenue (3) (474) Total revenue (TEB) (2) ,303 (8) 2,898 Non-interest expenses ,989 Restructuring charge Provision for credit losses (4) 210 Net income (loss) before taxes (87) 612 Income taxes and non-controlling interests (31) 218 Net income (loss) $ 84 $ 50 $ 50 $ 266 $ (56) $ 394 Unaudited, $ millions, for the nine months ended Jul. 31, 2000 Net interest income (TEB) (2) $ 1,680 $ 793 $ 447 $ 373 $ 72 $ 3,365 Non-interest income ,401 3, ,827 Intersegment revenue (3) (1,380) Total revenue (TEB) (2) 1,217 1,935 2,110 3, ,192 Non-interest expenses 861 1,353 1,587 2, ,065 Restructuring charge Provision for credit losses (4) 653 Net income (loss) before taxes ,334 (11) 2,474 Income taxes and non-controlling interests Net income (loss) $ 171 $ 264 $ 342 $ 979 $ (28) $ 1,728 Jul. 31, 1999 Net interest income (TEB) (2) $ 1,606 $ 725 $ 485 $ 595 $ (40) $ 3,371 Non-interest income 1, , ,458 Intersegment revenue (3) (1,425) 1, Total revenue (TEB) (2) 1,210 1,871 1,680 3, ,829 Non-interest expenses 753 1,331 1,449 1, ,585 Restructuring charge Provision for credit losses (4) 540 Net income (loss) before taxes (136) 1,603 Income taxes and non-controlling interests (57) 582 Net income (loss) $ 222 $ 223 $ 177 $ 478 $ (79) $ 1,021 (1) Corporate and Other comprises the four functional groups Treasury and Balance Sheet Management (TBM); Risk Management; Administration; and Corporate Development that support CIBC s business lines, as well as CIBC Mellon s custody business and other revenue and expense items not directly attributable to the four business lines. TBM revenues, expenses, capital and balance sheet items are allocated to the four business lines through a combination of funds transfer pricing and revenue, expense, balance sheet and capital allocation models. TBM is responsible for CIBC s overall balance sheet (including capital) management. As well, TBM s integrated Treasury Division provides all funding and financing, liquidity, cash and collateral management services across the business lines. The expenses of the Administration and Risk Management groups are also generally allocated to the business lines. (2) Taxable equivalent basis (TEB). See definition on page 15. (3) Intersegment revenue represents internal sales commissions, service fee and revenue allocations under the Manufacturer/Customer Segment/Distributor Management Model. (4) Represents an increase in the general provision for credit losses. CIBC Third Quarter Report

10 REVENUE BY BUSINESS LINE (1) (TEB) For the three months ended For the nine months ended Unaudited, $ millions Jul. 31 Apr. 30 Jul. 31 Jul. 31 Jul. 31 Electronic Commerce Mortgages (2) $ 81 $ 78 $ 104 $ 245 $ 266 Cards (2) Insurance Other ,217 1,210 Retail and Small Business Banking Retail banking Small business banking West Indies Lending products Other ,935 1,871 Wealth Management Imperial Service Private client investment and asset management , Global private banking and trust Wealth products Other ,110 1,680 CIBC World Markets Capital markets , Investment banking and credit products ,312 1,339 Merchant banking Commercial banking Other 26 (26) (2) (4) 33 1,291 1,399 1,303 3,629 3,007 Corporate and Other (8) Total $ 3,054 $ 3,359 $ 2,898 $ 9,192 $ 7,829 (1) Revenue includes the impact of internal sales commissions, service fee and revenue allocations under the Manufacturer/Customer Segment/Distributor Management Model. (2) Mortgages and Cards revenues are net of sales commissions and service fees paid to other business lines under the Manufacturer/Customer Segment/Distributor Management Model. These sales commissions and service fees amounted to $28 million, $26 million and $24 million for Mortgages and $12 million, $10 million and $9 million for Cards for the three months ended July 31, 2000, April 30, 2000 and July 31, 1999, respectively. These sales commissions amounted to $79 million and $72 million for Mortgages and $35 million and $27 million for Cards for the nine months ended July 31, 2000 and July 31, 1999, respectively. SELECTED INFORMATION Retail & Small CIBC Electronic Business Wealth World Corporate CIBC Unaudited, for the three months ended Commerce Banking Management Markets and Other Total Jul. 31, 2000 Average assets (1) ($ millions) $ 80,014 $ 49,412 $ 21,215 $ 114,731 $ 1 $ 265,373 Return on equity 15.6% 18.9% 57.5% 34.7% (2) 23.8% Efficiency ratio 68.0% 70.9% 79.9% 54.3% (2) 65.4% Full-time equivalent employees 15,474 15,633 8,055 3,342 2,763 45,267 Apr. 30, 2000 Average assets (1) ($ millions) $ 73,918 $ 46,828 $ 18,399 $ 121,970 $ 553 $ 261,668 Return on equity 15.5% 17.6% 78.1% 38.5% (2) 28.5% Efficiency ratio 72.6% 69.2% 75.7% 56.1% (2) 62.4% Full-time equivalent employees 15,066 15,221 8,273 3,236 2,786 44,582 Jul. 31, 1999 Average assets (1) ($ millions) $ 67,440 $ 43,511 $ 18,005 $ 141,089 $ 710 $ 270,755 Return on equity 20.4% 8.8% 28.6% 25.1% (2) 15.4% Efficiency ratio 61.1% 75.2% 88.8% 62.6% (2) 71.6% Full-time equivalent employees 15,514 16,498 8,389 3,693 3,307 47,401 Unaudited, for the nine months ended Jul. 31, 2000 Average assets (1) ($ millions) $ 75,920 $ 47,937 $ 19,302 $ 118,118 $ 402 $ 261,679 Return on equity 15.1% 17.6% 74.5% 30.3% (2) 23.5% Efficiency ratio 70.7% 69.9% 75.2% 57.9% (2) 66.0% Jul. 31, 1999 Average assets (1) ($ millions) $ 67,295 $ 43,796 $ 17,793 $ 145,779 $ 792 $ 275,455 Return on equity 19.2% 14.4% 36.5% 13.9% (2) 13.5% Efficiency ratio 62.2% 71.8% 86.3% 68.3% (2) 72.6% (1) Assets are disclosed on an average basis as this measure is most relevant to a financial institution and is the measure reviewed by CIBC s management. (2) Not meaningful. 10 CIBC Third Quarter Report 2000

11 CIBC CONSOLIDATED FINANCIAL STATEMENTS CONSOLIDATED STATEMENTS OF INCOME For the three months ended For the nine months ended Unaudited, $ millions Jul. 31 Apr. 30 Jul. 31 Jul. 31 Jul. 31 Interest income Loans $ 2,990 $ 2,731 $ 2,723 $ 8,450 $ 8,326 Securities ,386 2,119 Deposits with banks ,007 3,639 3,583 11,248 10,825 Interest expense Deposits and other liabilities 2,867 2,480 2,362 7,756 7,298 Subordinated indebtedness ,950 2,560 2,444 7,989 7,547 Net interest income 1,057 1,079 1,139 3,259 3,278 Provision for credit losses ,606 2,738 Non-interest income Fees for services Underwriting Deposit Credit Card Trust and custodial Mutual funds Insurance ,376 2,055 Commissions on securities transactions , Trading activities Investment securities gains, net Income from securitized assets Other ,965 2,249 1,727 5,827 4,458 2,804 3,036 2,656 8,433 7,196 Non-interest expenses Employee compensation and benefits 1,168 1,285 1,210 3,665 3,349 Occupancy costs Computer and office equipment Communications Advertising and business development Professional fees Business and capital taxes Restructuring charge Other ,996 2,096 2,076 6,065 5,686 Net income before income taxes ,368 1,510 Income taxes ,758 1,053 Non-controlling interests in net income of subsidiaries Net income $ 601 $ 676 $ 394 $ 1,728 $ 1,021 Dividends on preferred shares $ 33 $ 33 $ 28 $ 94 $ 84 Net income applicable to common shares $ 568 $ 643 $ 366 $ 1,634 $ 937 CIBC Third Quarter Report

12 CIBC CONSOLIDATED FINANCIAL STATEMENTS CONSOLIDATED BALANCE SHEETS Unaudited, $ millions, as at Jul. 31 Jul. 31 ASSETS Cash resources Cash and non-interest bearing deposits with banks $ 1,506 $ 929 Interest-bearing deposits with banks 12,237 9,862 13,743 10,791 Securities Securities held for investment 15,776 12,378 Securities held for trading 49,255 50,433 Loan substitute securities ,197 62,972 Loans Residential mortgages 50,222 45,668 Personal and credit card loans 26,936 23,972 Business and government loans 46,542 46,898 Securities purchased under resale agreements 21,331 29, , ,822 Other Derivative instruments market valuation 24,040 24,951 Customers liability under acceptances 9,069 9,137 Land, buildings and equipment 1,547 2,265 Other assets 7,153 5,846 41,809 42,199 $ 265,780 $ 261,784 LIABILITIES AND SHAREHOLDERS EQUITY Deposits Individuals $ 62,211 $ 60,431 Businesses and governments 103,142 82,595 Banks 11,441 17, , ,315 Other Derivative instruments market valuation 23,802 24,368 Acceptances 9,069 9,137 Obligations related to securities sold short 16,320 18,820 Obligations related to securities sold under repurchase agreements 13,487 22,707 Other liabilities 9,682 10,433 Non-controlling interests in subsidiaries ,584 85,677 Subordinated indebtedness 4,433 4,407 Shareholders equity Preferred shares 2,287 1,946 Common shares 2,905 3,070 Retained earnings 6,777 6,369 11,969 11,385 $ 265,780 $ 261, CIBC Third Quarter Report 2000

13 CIBC CONSOLIDATED FINANCIAL STATEMENTS CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY As at or for the three months ended As at or for the nine months ended Unaudited, $ millions Jul. 31 Apr. 30 Jul. 31 Jul. 31 Jul. 31 Preferred shares Balance at beginning of period $ 2,284 $ 2,267 $ 1,927 $ 1,933 $ 1,961 Issue of preferred shares 345 Translation adjustment on foreign currency preferred shares (15) Balance at end of period $ 2,287 $ 2,284 $ 1,946 $ 2,287 $ 1,946 Common shares Balance at beginning of period $ 2,905 $ 2,987 $ 3,096 $ 3,035 $ 3,128 Issue of common shares Repurchase of common shares (6) (88) (27) (143) (67) Balance at end of period $ 2,905 $ 2,905 $ 3,070 $ 2,905 $ 3,070 Retained earnings Balance at beginning of period $ 6,365 $ 6,213 $ 6,207 $ 6,090 $ 6,047 Net income ,728 1,021 Dividends Preferred (33) (33) (28) (94) (84) Common (127) (129) (123) (376) (371) Premium on repurchase of shares (26) (370) (103) (564) (269) Other (3) 8 22 (7) 25 Balance at end of period $ 6,777 $ 6,365 $ 6,369 $ 6,777 $ 6,369 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS For the three months ended For the nine months ended Unaudited, $ millions Jul. 31 Apr. 30 Jul. 31 Jul. 31 Jul. 31 Cash flows from (used in) operating activities $ (3,577) $ (16) $ 969 $ (4,694) $ 127 Cash flows from (used in) financing activities (1,067) 9,723 (4,096) 16,281 (6,469) Cash flows from (used in) investing activities 4,968 (10,493) 3,920 (12,116) 7,527 Net increase (decrease) in cash and cash equivalents during the period 324 (786) 793 (529) 1,185 Cash and cash equivalents at beginning of period 847 1,633 2,023 1,700 1,631 Cash and cash equivalents at end of period $ 1,171 $ 847 $ 2,816 $ 1,171 $ 2,816 RESTRUCTURING PROVISION (1) As at or for the three months ended July 31, 2000 As at or for the nine months ended July 31, 2000 Termination Termination Unaudited, $ millions Benefits Other Total Benefits Other Total Balance at beginning of period $ 200 $ 16 $ 216 $ 346 $ 19 $ 365 Drawdown during the period Balance at end of period $ 159 $ 12 $ 171 $ 159 $ 12 $ 171 (1) The following represents significant actions taken under the restructuring program. Electronic Commerce continued to reorganize the technology and operations infrastructure, completed restructuring mortgage operations and finalized the exit of direct life insurance products. Retail and Small Business Banking has had a net reduction of 79 branches in its Canadian and West Indies operations since the end of fiscal Wealth Management completed restructuring of domestic trust operations. Realignment of the Imperial Service sales force is in progress. CIBC World Markets continued to implement its defined cost reduction programs including restructuring the Commercial Bank customer service platform. Corporate and Other completed its consolidation of head office human resource operations. Approximately 625 positions were reduced in the quarter (year-to-date, approximately 2,275 positions). CIBC Third Quarter Report

14 OUTSTANDING SHARES Unaudited, as at July 31, 2000 October 31, 1999 Class A Preferred Shares (1) Fixed rate shares entitled to non cumulative dividends Series 12 6,000,000 6,000,000 Series 13 8,000,000 8,000,000 Series 14 8,000,000 8,000,000 Series 15 12,000,000 12,000,000 Series 16 5,500,000 5,500,000 Series 17 6,500,000 6,500,000 Series 18 12,000,000 12,000,000 Series 19 8,000,000 8,000,000 Series 20 4,000,000 4,000,000 Series 21 8,000,000 Series 22 4,000,000 Common shares 383,989, ,278,579 Employee stock options outstanding (2) Options with Stock Appreciation Rights 16,128,476 16,933,275 (3) Options without Stock Appreciation Rights 4,988,616 (1) The rights and privileges of Class A Preferred Shares Series are described in Note 11 of CIBC s October 31, 1999 consolidated financial statements. Series 21 and 22 have the same rights and privileges, including the right to convert the shares to CIBC common shares on or after a specified conversion date. (2) Under CIBC s Employee Stock Option Plan, stock options are periodically granted to designated employees. Each vested option provides the employee with the right to purchase from CIBC one CIBC common share at a fixed strike price equal to the market price of the stock at the grant date. Up to 50% of vested options with Stock Appreciation Rights (SARs) can be exchanged at the employee s option for a cash amount equal to the difference between the option strike price and the weighted average price of the common shares on The Toronto Stock Exchange the day immediately preceding the day the SARs are exercised. (3) Options outstanding as at October 31, 1999 have been adjusted to reflect two special option grants issued in fiscal DIRECT DIVIDEND DEPOSIT SERVICE Canadian-resident holders of common shares may have their dividends deposited directly into their account at any financial institution which is a member of the Canadian Payments Association. To arrange, please write to CIBC Mellon Trust Company, P.O. Box 7010, Adelaide Street Postal Station, Toronto, Ontario M5C 2W9. SHAREHOLDERS INVESTMENT PLAN Registered holders of CIBC common shares wanting to acquire additional common shares of the bank may participate in the shareholder investment plan and pay no brokerage commissions or service charges. For a copy of the offering circular, contact the Corporate Secretary at (416) or fax (416) PRICE OF COMMON SHARES PURCHASED UNDER THE SHAREHOLDER INVESTMENT PLAN Date Share purchase Dividend reinvestment & purchased option stock dividend options May 1/00 $38.00 June 1/00 $41.91 July 4/00 $41.15 July 28/00 $ CIBC Third Quarter Report 2000

15 THIRD QUARTER FINANCIAL HIGHLIGHTS As at or for the three months ended As at or for the nine months ended Unaudited Jul. 31 Apr. 30 Jul. 31 Jul. 31 Jul. 31 Jul. 31 Jul. 31 COMMON SHARE INFORMATION (US$) (1) (US$) (1) Per share basic earnings $ 1.47 $ 1.64 $ 0.89 $ 0.99 $ 4.17 $ 2.27 $ 2.84 fully diluted earnings $ 1.43 $ 1.60 $ 0.88 $ 0.96 $ 4.06 $ 2.24 $ 2.77 dividends $ 0.33 $ 0.33 $ 0.30 $ 0.22 $ 0.96 $ 0.90 $ 0.65 book value $ $ $ $ $ $ $ Share price high $ $ $ $ $ $ $ low $ $ $ $ $ $ $ closing $ $ $ $ $ $ $ Shares outstanding (thousands) average basic 384, , , , , , ,667 average fully diluted 400, , , , , , ,995 end of period 383, , , , , , ,989 Market capitalization ($ millions) $ 16,281 $ 14,919 $ 14,511 $ 10,949 $ 16,281 $ 14,511 $ 10,949 VALUE MEASURES Price to earnings multiple (12 months trailing) Dividend yield (based on closing share price) 3.1% 3.5% 3.3% 3.1% 3.0% 3.4% 3.0% Dividend payout ratio 22.4% 19.9% 33.7% 22.4% 22.9% 39.6% 22.9% Market value to book value ratio OPERATING RESULTS ($ millions) Total revenue on a taxable equivalent basis (TEB) (2) $ 3,054 $ 3,359 $ 2,898 $ 2,054 $ 9,192 $ 7,829 $ 6,269 Provision for credit losses $ 218 $ 292 $ 210 $ 147 $ 653 $ 540 $ 445 Non-interest expenses $ 1,996 $ 2,096 $ 2,076 $ 1,343 $ 6,065 $ 5,686 $ 4,136 Net income $ 601 $ 676 $ 394 $ 404 $ 1,728 $ 1,021 $ 1,178 OPERATING MEASURES Net interest margin (TEB) (2) 1.63% 1.73% 1.72% 1.63% 1.72% 1.64% 1.72% Net interest margin on average interest earning assets (TEB) (2) 1.94% 2.05% 2.07% 1.94% 2.04% 1.99% 2.04% Efficiency ratio (3) 65.4% 62.4% 71.6% 65.4% 66.0% 72.6% 66.0% Return on common equity 23.8% 28.5% 15.4% 23.8% 23.5% 13.5% 23.5% Return on average assets 0.90% 1.05% 0.58% 0.90% 0.88% 0.50% 0.88% BALANCE SHEET INFORMATION ($ millions) Cash resources and securities $ 78,940 $ 80,739 $ 73,763 $ 53,087 $ 78,940 $ 73,763 $ 53,087 Loans and acceptances $ 154,100 $ 154,684 $ 154,959 $ 103,632 $ 154,100 $ 154,959 $ 103,632 Total assets $ 265,780 $ 267,435 $ 261,784 $ 178,737 $ 265,780 $ 261,784 $ 178,737 Deposits $ 176,794 $ 176,966 $ 160,315 $ 118,894 $ 176,794 $ 160,315 $ 118,894 Common shareholders equity $ 9,682 $ 9,270 $ 9,439 $ 6,511 $ 9,682 $ 9,439 $ 6,511 Average assets $ 265,373 $ 261,668 $ 270,755 $ 178,490 $ 261,679 $ 275,455 $ 178,465 Average interest earning assets $ 223,073 $ 219,885 $ 224,853 $ 150,039 $ 219,940 $ 226,000 $ 149,999 Average common shareholders equity $ 9,500 $ 9,160 $ 9,433 $ 6,390 $ 9,304 $ 9,302 $ 6,345 Assets under administration $ 696,900 $ 676,500 $ 544,200 $ 468,665 $ 696,900 $ 544,200 $ 468,665 BALANCE SHEET QUALITY MEASURES Common equity to risk-weighted assets 7.2% 6.8% 6.9% 7.2% 7.2% 6.9% 7.2% Return on risk-weighted assets 1.77% 2.04% 1.15% 1.77% 1.71% 0.98% 1.71% Tier 1 capital ratio 8.9% 8.5% 8.4% 8.9% 8.9% 8.4% 8.9% Total capital ratio 12.0% 11.6% 11.5% 12.0% 12.0% 11.5% 12.0% Net impaired loans after general allowance ($ millions) $ (170) $ (319) $ (200) $ (114) $ (170) $ (200) $ (114) Net impaired loans to net loans and acceptances (0.11)% (0.21)% (0.13)% (0.11)% (0.11)% (0.13)% (0.11)% (1) Represents the translation of Canadian GAAP financial information into US$ using the quarter-end rate of $ for balance sheet figures and the average rate of $ for the quarter and $ for year-to-date operating results. (2) Taxable equivalent basis (TEB). Net interest income includes tax-exempt income on certain securities. Since this income is not taxable to CIBC, the rate of interest or dividend received by CIBC is significantly lower than would apply to a loan of the same amount. As the impact of tax-exempt income varies from year to year, such income has been adjusted to a taxable equivalent basis to permit uniform measurement and comparison of net interest income. An equal and offsetting adjustment is made to increase the provision for income taxes. (3) Efficiency ratio may also be referred to as non-interest expenses to revenue ratio. CIBC Third Quarter Report

16 TO REACH US: Corporate Secretary: For shareholder information, call (416) or fax (416) Investor Relations: Financial analysts, portfolio managers and other investors requiring financial information may call (416) or fax (416) Corporate Communications: For information on corporate activity and media inquiries, please call (416) or fax (416) CIBC Telephone Banking: As part of our commitment to our customers, information, products and services are available by calling (416) 980-CIBC or toll-free across Canada at CIBC. Office of the CIBC Ombudsman: CIBC Ombudsman Lachlan MacLachlan can be reached by telephone at (Toronto (416) ), or by fax (Toronto (416) ). Online investor presentation: Full financial statements and a presentation to investors and analysts are available on the CIBC website, Investor Relations section at Earnings conference call: Instant replay of the quarterly conference call will be available at approximately 6 p.m. (EDT) September 7 to midnight (EDT) September 21, The call may be accessed by calling either (416) in Toronto or toll-free from elsewhere in North America at , passcode Webcast of call: A live webcast of CIBC s quarterly conference call will take place on September 7, 2000 at 3:30 p.m. EDT. You may access the call through CIBC s website at An archived version of this call will also be available on CIBC s website. Please note: You will require the RealPlayer software plugin to hear the webcast call. This may be obtained at no cost to you. Please visit our website at to obtain further details about downloading this software. Canadian Imperial Bank of Commerce Head Office: Commerce Court, Toronto, Ontario, Canada M5L 1A2 (416)