FirstCaribbean International Bank rebranding to CIBC
CIBC FirstCaribbean International Bank Limited (CIBC FCIB) is planning to rebrand its business to that of its Canadian parent company in the coming financial year (FY) at a time when it is exiting the Dutch Caribbean.
CIBC FCIB will adopt the name of its parent and be known as CIBC (Canadian Imperial Bank of Commerce). The announcement was made to staff yesterday morning, which was the final day of CIBC FCIB and its parent company CIBC’s 2023 FY. CIBC FCIB is a 91.67 per cent-controlled subsidiary of CIBC and has branding as CIBC FirstCaribbean. CIBC is Canada’s fifth-largest bank by total assets with CA$943 billion (US$711.65 billion) while CIBC FCIB had US$12.73 billion in total assets as at July 31.
“We’ve been on an awesome journey to transform our business over the past three years. We’ve achieved some remarkable things together. We created the type of omni-channel banking experience that allows our clients to bank with us using our award-winning digital services whenever they want to and come into the banking hall when they need to,” said CIBC FCIB Chief Executive Officer Mark St Hill in a press release. The release also referenced the adoption of the CIBC brand as the parent company’s commitment to the Caribbean region.
St Hill also added, “We will have the strength of this global powerhouse behind us, while maintaining the Caribbean flavour and knowledge of the marketplace that we have become known for. So, we will honour the past — recognising where we have come from — while looking excitedly to the future.”
This move to further align CIBC FCIB in line with its parent comes following prior moves by CIBC to rebalance its Caribbean portfolio. CIBC FCIB had attempted to list on the New York Stock Exchange (NYSE) via an initial public offering (IPO) before it was withdrawn in April 2018. CIBC had reached an agreement with the Colombian GNB Financial Group to sell 66.73 per cent of the business for US$797 million, but the deal was rejected by regional regulators in February 2021.
CIBC FCIB sold its Aruban operations in February 2022 for US$6.8 million and completed the sale of its St Vincent and the Grenadines and Grenada assets on March 24 and July 14. However, due to the inability to close the acquisition of its Dominican operations with the National Bank of Dominica Limited in 2022, it closed its operations on January 31. The associated net gain from the sale of these three territories was US$5.71 million for the nine-month period.
CIBC FCIB’s wholly owned subsidiary CIBC FCIB (Cayman) Limited will now be selling the banking assets of its Curaçao and St Maarten to Curaçao-based Orco Bank. This will see CIBC FCIB exit the Dutch Caribbean composed of the ABC islands. The transactions are expected to be finalised in the coming months following regulatory approval by the Cayman Islands Monetary Agency, the Central Bank of Barbados, and the Centrale Bank van Curaçao en Sint Maarten.
The transactions shouldn’t have a material impact on CIBC FCIB’s tier one and total capital ratios which stood at 16.8 and 18.5 per cent, respectively, at the end of July.
“These transactions are the final ones in our programme of country divestitures that began in 2021 with the sale of our assets in Aruba and some of our OECS territories. This programme began as part of our strategy to enable CIBC FirstCaribbean to optimise and simplify its business, further enhance efficiency and focus on core markets to accelerate growth. When these divestitures are completed, it will allow our bank to turn its full attention to growing our business, consolidating our position in our core markets and optimising our strategy of providing a second-to-none omni-channel banking service to our clients,” St Hill added in the press release.
Edward Pietersz, managing director and CEO of Orco Bank, added, “Acquiring CIBC FirstCaribbean’s banking assets presents an excellent opportunity for Orco Bank. We are thrilled to welcome new customers and remain dedicated to delivering superior service to both our existing and new clientèle. With an expanded reach, we are well-positioned to fulfil our mission of being the preferred partner, offering innovative, customer-driven solutions that enable financial freedom in a responsible and sustainable manner while creating shared value for our communities.”
CIBC FCIB’s leading markets according to its 2022 audited financials were Barbados and The Bahamas which brought in revenue of US$154.91 million and US$166.02 million, respectively. Jamaica accounted for US$58.51 million in revenue and US$951.50 million in total assets relative to the CIBC FCIB’s consolidated US$599.28 million in revenue and US$13.13 billion in total assets.
CIBC FCIB’s revenue grew 29 per cent to US$554.40 million for the nine months with net profit from continuing operations jumping 65 per cent to US$211.16 million. Net profit attributable to shareholders was US$212.51 million with earnings per share at US$0.131.
Loans and advances rose two per cent to US$6.68 billion with its securities portfolio increasing to US$2.93 billion as at July 31. Total liabilities and equity attributable to shareholders was US$11.40 billion and US$1.29 billion, respectively.
CIBC FCIB’s share price closed Tuesday at TT$6.84 on the Trinidad and Tobago Stock Exchange (TTSE) which leaves it up 26 per cent year-to-date with a market capitalisation of TT$10.79 billion. A dividend of US$0.0125 was paid on October 13 to shareholders on record as of September 22. This dividend totalled US$19.71 million and brought the 2023 FY dividend payments to US$74.92 million.
CIBC’s full year results are to be released on November 30 at 7:30 am while CIBC FCIB’s earnings will be released in mid-December on the TTSE. Janine Billy was appointed CIBC FCIB’s chief human resources officer on November 1.
“We are pivoting towards growing our company. We’ve created a great company out of the legacy of the two that came before and we are moving forward, looking forward to a bright future for our company. Our bank is turning its full attention to growing our business, consolidating our position in our core markets, and optimising our strategy of providing a second-to-none omni-channel banking service to our clients,” St Hill concluded.