Canadian Imperial Bank of Commerce Q3 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Sohrab Movahedi - BMO Capital Markets Corp - Analyst : Okay. Thank you. Firstly, Victor, congratulations and thank you for putting up with me over the years.

Question: Sohrab Movahedi - BMO Capital Markets Corp - Analyst : Rob, you completed the NCIB. You've renewed it. Is it your intention to complete the renewed one? And is this -- I don't know, should I interpret this as confidence in the earnings trajectory of the bank?

Question: Sohrab Movahedi - BMO Capital Markets Corp - Analyst : Okay, thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 28, 2025 / 11:30AM, CM.TO - Q3 2025 Canadian Imperial Bank of Commerce Earnings Call

Question: Ebrahim Poonawala - BofA Securities Inc - Analyst : Hey, good morning. So yes, I guess, first of all, Victor, congratulations. I think everyone hopes to do this. You are truly leading commerce in a better place than what you inherited, so in terms of consistency, stability. So credit to you and the rest of the team.

Question: Ebrahim Poonawala - BofA Securities Inc - Analyst : No doubt, but it does require a strong leader. So you've done that and you're a humble person, but well done and all the best to you in retirement. But I guess the question maybe following up as we think about where we go from here, and Rob, to your point, ROE drifting higher as they look towards the returns you all have delivered, combine that with the outlook on margin expansion going forward -- and I know we kind of recalibrated the ROE target to about 15% plus over the last year. But just talk to us in terms of the true ROE potential of the company as you think about sort of the rhythm you have in operating leverage where margin is headed. And at some point, there may be probably a little bit of capital flex too. Is 15% plus more like 16% plus, the way you see the world and if things are macro-wise getting better?

Question: Ebrahim Poonawala - BofA Securities Inc - Analyst : Got it. Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 28, 2025 / 11:30AM, CM.TO - Q3 2025 Canadian Imperial Bank of Commerce Earnings Call

Question: Gabriel Dechaine - National Bank Financial Inc - Analyst : Good morning. And yes, Victor, congrats on the retirement. And if you want to meet up for a glass of rakia at some point in your post-CEO phase, let me know.

Question: Gabriel Dechaine - National Bank Financial Inc - Analyst : Okay. Well, we can stick to that limit. The margin guidance, I know there's always some conservatism embedded in forward statements and all that. Last quarter was stable to up a bit, and it sounds a little bit similar, but maybe a bit more optimistic. And this quarter, you did outperform your guidance. And I'm assuming several factors, deposit mix, competitive dynamics, all kind of went in the right direction. Of those elements, what do you think is a sustainable trend? Because -- and as we look ahead to 2026, when you got a bunch of mortgages refinancing -- and I also see the chart that has new mortgages coming on the balance sheet are at higher spreads than the ones leaving. Is this -- are we cautiously optimistic, maybe too much, though?

Question: Gabriel Dechaine - National Bank Financial Inc - Analyst : All right. I'll stick to the one question.

Question: Doug Young - Desjardins Securities Inc - Analyst : I guess for Frank, it seems like Canadian personal unsecured credit trends are improving. And it seems like that's been the case across a lot of the banks that have been reported. But can you touch on a little bit what you're seeing and expectations over the coming year? And obviously, the big risk right now, especially in Canada, depending USMCA renegotiations that are coming eventually -- and can you talk a bit about how you kind of factor that risk into your expert credit judgment or your performing loan allowances or whatnot?

Question: Doug Young - Desjardins Securities Inc - Analyst : Okay. And Victor, all the best in retirement. Thanks for everything. And I'll leave it there, thanks.

Question: Mario Mendonca - TD Securities Inc - Analyst : Good morning. Victor, let me add my congratulations. And it's very impressive, what, 10 years plus as CEO.

Question: Mario Mendonca - TD Securities Inc - Analyst : Good stuff. Frank, going to you. So I totally agree with Doug just offered that the unsecured Canadian credit looks a little better. That's true mostly across the industry, might be maybe one modest exception there. But for your bank specifically, given that, let's call it, stabilization in unsecured consumer, is there any reason why you would move off of the mid-30s guidance, impaired PCLs going forward, thinking about 2026 and going forward? Is there anything that's happening? And let's leave USMCA negotiations aside. Because we all know if that falls apart, then we've got a bigger issue. So leaving that aside, is there any reason why you changed that guidance?

Question: Mario Mendonca - TD Securities Inc - Analyst : All right. And then is there any concern on the mortgage side? I see that 90 delinquencies, up a little bit on a total bank basis. But GVA, GTA did look more stressful. Does that cause you any concern that the uninsured mortgages in Toronto and Vancouver are more -- are showing more stress than the rest of the book?

Question: Mario Mendonca - TD Securities Inc - Analyst : All right. I'll be really quick on this one. So maybe to Rob, the move in this all-bank margin, no matter how you calculate it, has been huge since Q4 '22. I'm talking big moves in the all-bank margin. There's so many reasons why this focus on pricing over volume rates, mix, product margins. There's a ton of reasons why. But as we think about the next 12 months, would it be fair to suggest that this huge move we've seen over the last couple of years, that was special? And that we get a little bit more of a pedestrian improvement in the margin going forward?

Question: Mario Mendonca - TD Securities Inc - Analyst : Thank you.

Question: Darko Mihelic - RBC Capital Markets Inc - Analyst : Hi, thank you. Good morning. I have one question and one compliment. So I'll start with the compliment, Victor. All the best, and I have a special slivovitz to have later on. So hopefully, you can take me up on that offer.

Question: Darko Mihelic - RBC Capital Markets Inc - Analyst : A question for you. I did hear in your prepared remarks that you were number two, let's say, in net sales in the quarter. I wanted to ask about -- because I haven't heard a bit of an update here on where you stand with Imperial Service. I know you were hiring advisers. Maybe you can provide a bit of an update on where you are with respect to that and where you are, let's say, also with how productive they are? Or are they just hitting stride? So maybe you can just give me an overall view on what we should expect from the Imperial Service and how it's helping -- presumably not just mutual fund sales, but generally, Wealth. I'd like to hear that if you have anything that you could offer. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 28, 2025 / 11:30AM, CM.TO - Q3 2025 Canadian Imperial Bank of Commerce Earnings Call

Question: Darko Mihelic - RBC Capital Markets Inc - Analyst : Okay, thanks very much. I'm going to follow up, Hratch, at some point in the next week or so. Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 28, 2025 / 11:30AM, CM.TO - Q3 2025 Canadian Imperial Bank of Commerce Earnings Call