CIBC Investor Forum

BMO Capital Markets, 1 October 2010Scotiabank has been upgraded to Outperform, while Royal Bank’s rating slipped to Market Perform. Greater clarity on new bank capital rules has mitigated our concern they would hinder BNS’s international growth strategy. Moreover, we believe that the bank’s international operations provide a clear growth path, relative to its peer group, after credit costs have `

Review of Banks' Q3 2010 Earnings

Scotia Capital, 13 September 2010Event• Canadian banks' third quarter operating earnings were disappointing, missing earnings estimates, the first quarterly miss of the earnings recovery cycle. ROE: 15.9%, RRWA: 2.06%, Tier 1: 12.8%.Implications• The major collapse in trading revenue from record levels a year earlier cut wholesale earnings in half. Trading revenue as a percentage of total revenue

Canadian Banks Confident Ahead of New Basel Rules

Thomson Reuters, 27 August 2010Canada's banks appear set to handily absorb stiffer global capital and liquidity rules being developed by the Basel banking committee, meaning they could soon begin raising dividends and making acquisitions.While the new regulations won't be released until November, the CEOs of Canada's big six banks have begun speaking more confidently about their ability to adopt

CIBC Q3 2010 Earnings

Scotia Capital, 26 August 2010Event• CIBC (CM) reported an increase in cash operating earnings of 22% YOY to $1.66 per share beating expectations due to surprisingly strong trading revenue/wholesale earnings and slightly higher security gains. Operating ROE was 21.5% with RRWA of 2.39%.Implications• Wholesale Banking operating earnings declined 33% YOY to $123 million, but remained surprisingly

Credit Suisse: Revenue Growth to Slow for Banks

Credit Suisse, 19 August 2010As Canadian bank earnings/returns on equity (ROE) benefit from declining credit charges, slowing revenue growth represents a headwind.We forecast provisions for credit losses (PCLs) to decline 35% and 36% in 2010 and 2011, respectively, providing a substantial boost to group profitability. However, as this earnings/ROE driver loses momentum, the onus falls on revenue

Preview of Banks' Q3 2010 Earnings

Scotia Capital, 12 August 2010Banks Begin Reporting Third Quarter Earnings August 24 - Uninspiring• Banks begin reporting third quarter earnings with Bank of Montreal (BMO) on August 24, followed by Canadian Imperial Bank of Commerce (CM) on August 25, Royal Bank (RY) and National Bank (NA) on August 26, Bank of Nova Scotia (BNS) on August 31, Canadian Western (CWB) on September 1 (after market

Basel Tone Improves - Positive for Canadian Banks

Scotia Capital, 28 July 2010• The Basel Committee on Banking Supervision reached broad agreement July 26, 2010 on the overall design of the capital and liquidity reform package including definition of capital, the treatment of counterparty credit risk, the leverage ratio, and the global liquidity standard.• In general, the agreement seems to provide a more balanced and constructive approach to

Review of Banks' Q1 2010 Earnings

Scotia Capital, 19 March 2010Strong Earnings, Ahead of Market Expectations• Canadian banks reported another quarter of strong operating results. Bank earnings again exceeded Street expectations for the fourth straight quarter, thus further confirming that the bottom in operating earnings this cycle was Q2/09, which coincided with what we believe was peak quarterly loan loss provisions. Operating

CIBC Q1 2010 Earnings

Scotia Capital, 26 February 2010• CM reported a decline in cash operating earnings of 1% to $1.65 per share above our estimate and consensus due to higher net interest margin and stronger-than-expected results from wholesale with trading revenue flat QOQ. ROE was 22.5% with RRWA of 2.21%.Implications• CIBC Retail Markets earnings declined 9% YOY to $529M due mainly to loan loss provisions

Preview of Banks' Q1 2010 Earnings

Scotia Capital, 18 February 2010Banks Begin Reporting February 25• Banks begin reporting first quarter earnings with Canadian Imperial Bank of Commerce (CM) and National Bank (NA) on February 25, followed by Bank of Montreal (BMO) on March 2, Royal Bank (RY) and Laurentian Bank (LB) on March 3, Canadian Western (CWB) and Toronto Dominion (TD) on March 4, and Bank of Nova Scotia (BNS) closing out

What Toronto Can Teach New York and London

The Financial Times, Chrystia Freeland, 29 January 2010There’s something about Canada that inspires gentle mockery from foreigners, especially those who live south of the border. Kelly Ripa, the co-host of a popular US talk show, this month engaged in an extended on-air riff with her husband (don’t ask) about the absurdity of Canadian place names; Regina came in for a particular beating. South

Canada's Dividend Culture

Scotia Capital, 27 January 2010• The following are excerpts from our full report titled "Canada's Dividend Culture".• The main risk currently, in our opinion, to the Canadian banking industry and bank valuation is “regulatory” in terms of over-regulation and mis-regulation. The major uncertainty is what operating and financial constraints will be placed on banks by the regulator. We believe that

BMO NB & Scotia Capital Prefer Insurance Cos.

Scotia Capital, 11 January 2010TSX Insurance over TSX Banks. Insurance stocks have underperformed Banks by roughly 40% in the last 12-months. More recently, however, the Insurance sector has easily outperformed, posting a gain of 12.9% in the last month versus -1.2% for the TSX Banks index. We believe Insurance will continue to outperform Banks in coming months as LT yields move up and the yield

Review of Banks' Q4 2009 Earnings

Scotia Capital, 14 December 2009Event• We are downgrading the Canadian banks to marketweight from overweight due to their strong absolute and relative share price performance in 2009 and increased regulatory/political risk.• Bank stocks have doubled off their 2009 lows and are up 51% year-to-date outperforming the TSX by 23% thus far in 2009.Implications• Banks just finished reporting strong Q4/