CIBC, National top estimates, shares rise
By Cameron French
TORONTO (Reuters) - Canadian Imperial Bank of Commerce (CM.TO: Quote) and National Bank of Canada (NA.TO: Quote) capped off Canadian second-quarter bank results on a strong note on Thursday, exceeding estimates and sending their shares higher.
Shares of CIBC, Canada's No. 5 bank, jumped 2.2 percent to a two-week high after the company reported a 6 percent increase in net profit due partly to higher loan volumes.
Core profit was C$2.00 a share, topping estimates of C$1.88 a share. Analysts pegged the beat to strong cost containment coupled with modest growth in loans.
"CIBC managed to generate bank-wide operating leverage, despite a modest decline in core revenues as expenses in the quarter declined 1.5% sequentially. This is a strong performance and has been a consistent theme for CIBC for several quarters," Barclays Capital analyst John Aiken said in a note.
Smaller rival National Bank of Canada said core profit rose 6 percent, also beating estimates on stronger consumer loan and mortgage growth. The company raised its quarterly dividend by 5 percent.
National's stock pushed up 1 percent.
CIBC LOAN GROWTH
The results wrap up a quarter in which Canada's six biggest banks' earnings were largely ahead of expectations, but not to the same degree as in recent quarters. Continued...