CIBC hikes dividend as first-quarter profits drop 11 per cent

TORONTO -- The Canadian Imperial Bank of Commerce hiked its dividend as it reported its first-quarter profit fell to $1.18 billion, down 11 per cent from $1.33 billion a year ago.

CIBC raised its quarterly payment to common shareholders by four cents to $1.40.

The Toronto-based lender's earnings for the three-month period ended Jan. 31 amounted to $2.60 per diluted share, down from $2.95 during the same period a year earlier.

The bank said its quarter included several one-time items, such as a $227-million charge for a payment made to Air Canada to secure the bank's participation in the airline's new loyalty program, that resulted in a total negative impact of 41 cents per share.

On an adjusted basis, CIBC earned $3.01 per share, down from $3.18 a year ago and below the $3.08 expected by analysts surveyed by Thomson Reuters Eikon.

Canada's fifth-largest lender saw double-digit drop in net income from Canadian personal and small business banking and capital markets, while its U.S. commercial banking and wealth management arm saw a 25 per cent uptick in earnings during the period.

"In the first quarter, we delivered solid performance across our strategic business units," said CIBC chief executive Victor Dodig in a statement.

"We continue to make progress on our strategy to build a client-focused North American bank with diversified earnings growth and disciplined expense and capital management while delivering superior shareholder returns."

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