CIBC Jamaica strengthens capital base
Published:Friday | January 10, 2025 | 12:08 AM
CIBC Caribbean Bank Jamaica Limited grew its capital by 39 per cent to nearly $20 billion following the issuance of shares to its parent, its year-end financial report shows.
Concurrently, the bank reported a two-thirds drop in profit.
CIBC said that capital strength would provide protection for depositors and creditors, and would allow the bank “to undertake profitable business opportunities as they arise” and that it “helps maintain favourable credit ratings”. The issuance added $4.6 billion in fresh capital to the local bank.
The head of CIBC Jamaica Nigel Holness didn’t immediately respond to requests for comment. The bank notes that its objective is to “employ” a “strong and efficient” capital base.
“During the year, the bank issued 348.85 million ‘A’ ordinary shares of no par value to its parent company,” according to the 2024 notes in the audited financials. “These shares will rank on equal footing with existing ordinary shares that are in issue.”
Its immediate parent is CIBC Caribbean Bank Limited, based in Barbados, while the ultimate parent is Canadian Imperial Bank of Commerce, headquartered in Toronto, Canada.
No shares were issued in the prior year.
The new share issue and the nearly $1 billion in total comprehensive income increased the local bank’s capital base from $14 billion in 2023 to $19.7 billion in 2024.
Among the eight commercial banks in Jamaica, CIBC Jamaica still holds the third smallest capital base, but the recent injection brings it closer to JMMB Bank Jamaica, which has $20.8 billion in capital, based on industry data.
The other six are National Commercial Bank Jamaica, $119.1 billion; Bank of Nova Scotia Jamaica, $80.1 billion; JN Bank, $28.8 billion; Sagicor Bank Jamaica, $28.1 billion; First Global Bank, $10.1 billion; and Citibank NA, $4.6 billion.
During its financial year, the local bank’s total revenue grew by 6.0 per cent to $10.8 billion. However, higher staff costs, up one-third, and the doubling of depreciation cut into gains, resulting in a profit reduction to $380 million for its year end from $1.1 billion a year earlier.
At CIBC Jamaica, loans grew by 25 per cent to $111.3 billion, up from $89 billion the previous year. Deposits also grew by 10 per cent to $160.7 billion.
CIBC Bank Caribbean formerly operated as FirstCaribbean International Bank. The regional network, including the Jamaican bank, was rebranded to CIBC last September.