Canadian Imperial Bank of Commerce

your conference is ready to begin. Good morning and welcome to the CIBC Quarterly Financial Results Call. Please be advised that this call is being recorded. I would now like to turn the meeting over to Mr. Jeff Weiss, Senior Vice President, Investment Relations. Please go ahead, Jeff.

Thank you and good morning. We will begin this morning's presentation with opening remarks from Victor Dodig, our President and Chief Executive Officer. followed by Hirash Panosian, our Chief Financial Officer, and Sean Bieber, our Chief Risk Officer. Also on the call today are a number of group heads, including Mike Capitides, U.S. Commercial Banking and Wealth Management, Terry Cullum, Capital Markets, Laura Dettori, Atenasio, Canadian Personal and Business Banking, and John Hantalis, Canadian Commercial Banking and Wealth Management. They are all available to take questions following the prepared remarks. During the Q&A, to ensure we have enough time for everyone to participate, we ask that you please limit your questions and re-queue. As noted on slide two of our investor presentation, our comments may contain forward-looking statements which involve assumptions and have inherent risks and uncertainties. Actual results may differ materially. With that, I will now turn the meeting over to Victor.

Thanks, Jeff, and good morning, everyone. Fiscal 2021 was a very good year for our bank. one in which we delivered strong financial results. And importantly, we positioned our bank well for future growth. On our call today, I want to cover three things. First, highlight certain areas where we've made strong strategic progress over the fiscal year. Second, provide you with our view on the economic involvement as we enter this coming fiscal year. And third, after Haraj and Sean's review of our fourth quarter results, I'd like to share some insights into our strategic priorities going forward. that we believe will build on the strong momentum we've established and enable further growth going forward. Our primary strategy over the past number of years has been to build a modern relationship-oriented bank with a strong core franchise and a diversified earnings mix. You can see that on this slide. Our success in executing on our strategy is reflected in our earnings growth in each of our business units, improved client experience scores, and further earnings diversification. In fiscal 2021, our laser focus on executing our strategic priorities delivered record results with adjusted earnings per share of $14.47, which is up 49% from 2020, an ROE of 17% and positive operating leverage. Our capital position remains strong, ending the year with a CET1 ratio of 12.4%. These results exceeded 2021 key performance targets and our rolling five-year total shareholder return of 92% outperformed the S&P TSX Bank's composite index. Our strong results support the announcements this morning of our share buyback program of 10 million common shares, which is just over 2% of our outstanding, and 15-cent dividend increase to our common shareholders, while maintaining our dividend payout ratio target of between 40% and 50%. Our results were driven by strong top-line growth across all of our businesses, supported by market share gains from client acquisitions, deepening relationships with our clients, and harnessing technology to enhance the client experience. We successfully rejuvenated and further strengthened our Canadian consumer franchise through market share gains in our core personal products, accelerated growth in DFS for our direct financial services business, and record net inflows from asset management. During the year, we also returned to market level growth in our mortgage business. We also continue to invest in technology to meet the evolving needs of our clients. The rollout of CIBC Gold Planner to our Imperial Service clients has been instrumental in driving deeper client relationships and a better client experience. And in our DFS business, we expanded our product offerings and our capabilities for our digital savvy clients who prefer a self-directed experience. And these investments resulted in double digit revenue growth. Overall, the significant progress we've made in providing a modern experience for our clients is reflected in our best client experience scores on record and over a decade of having the leading mobile banking app in Canada based on third party surveys. During the year, we continue to build on our areas of strength in commercial banking as global economic activity accelerated in 2021. so did the pace of loan growth in our commercial portfolios. Market share gains were attributable not only to existing clients, but also to new relationships that we've established. As well, cross-border referrals between our Canadian and U.S. business for clients seeking seamless North American access remain strong. In wealth management, robust funds flow and asset management and our brokerage business were supported by award-winning advisory teams. In a new ranking by the Globe and Mail Instruct Research, 35 of CIBC Wood Gundy's advisors were named among Canada's top wealth advisors, by far the largest number among participating Canadian peers. Our capital markets business continued to deliver strong results, with a number two ranking in both debt and equity underwriting in 2021. And importantly, our business is uniquely structured in capital markets to leverage the strong connectivity we have across our bank driving revenue growth of 27% in this area. This is a big differentiator for us. Throughout fiscal 2021, we continue to seek opportunities to further strengthen our competitive position and to invest for future growth. Our announcement in the fourth quarter to become the exclusive issuer of Costco MasterCards in Canada and to acquire the existing portfolio is a clear example of this. In addition to diversifying our credit card book, the Costco partnership provides us the opportunity to bring this valued client base deeper into our bank's suite of offerings. The Costco client base is highly aligned with our retail affluent strategy, and their growing membership will make this a strategically important investment in the coming years. Building on CIBC's strong history of ESG across our bank, we have released a refocused strategy that includes three key pillars. The first is accelerating climate action, which was released in August along with our net zero ambition. The second is creating access to opportunities for underserved and underrepresented communities to enable social and economic inclusion and to help them realize their ambitions. And the third is building integrity and trust to safeguard data, ensure we act responsibly, promote accountability and enhance client experience by leveraging technology and empowering our people. We're activating our resources to create positive change for our CIBC team, our clients, our communities and our planet, contributing to a more secure, equitable and sustainable future. Now let me turn to our economic outlook for 2022. In Canada, our economists are forecasting domestic GDP growth of 4% and unemployment is expected to average near 6%. In the United States, real GDP is expected to grow by 4.2% while unemployment is expected to average in the 4% range. On both sides of the border, interest rates are expected to rise by 50 basis points in the latter half of the calendar year. In speaking with our clients, the recent inflation pressure is largely driven by both labor-related and non-labor-related factors. Supply-side disruptions that drove pricing increases are expected to abate over time. However, wage inflation may persist until these labor shortages are resolved. For our business, the most important takeaway is that we're well positioned. Thanks to our strong capital position and, importantly, the depth of our client relationships, we will continue to pursue and we will deliver against our growth ambitions in the year ahead. And before I pass the call on to Haraj and Sean to review our fourth quarter results, I wanted to also acknowledge the recent extreme weather conditions that devastated parts of British Columbia. Our thoughts are with those who have been displaced and will continue to support our affected clients, colleagues, and their families as they work through these difficult circumstances. Our thoughts are with you. And with that, I'm going to turn the call over to Haraj for a financial review.