Further extends CIBC's wealth management business and North American platform
TORONTO, July 10, 2017 /CNW/ - CIBC (TSX: CM) (NYSE: CM) announced today that it has entered into a definitive agreement to acquire Geneva Advisors, a private wealth management firm, headquartered in Chicago. This complementary acquisition will enhance CIBC's presence in the region, and builds on the bank's ability to deepen client relationships in the U.S. following the recent acquisition of The PrivateBank. On closing, the Geneva Advisors business will become part of CIBC Atlantic Trust Private Wealth Management.
Geneva Advisors is an independent private wealth management firm focused on high net worth clients. The firm has US$8.4 billion in assets under management and approximately 100 employees. The transaction follows the completion of CIBC's recent acquisition of The PrivateBank in June, and will expand the bank's private wealth management client-base and investment management capabilities in the U.S.
"Acquiring Geneva Advisors will further strengthen CIBC Atlantic Trust Private Wealth Management, led by our CEO of this business and industry veteran Jack Markwalter," said Larry Richman, Group Head, U.S. Region, and President & CEO The PrivateBank. "This investment will add scale in key markets where we can offer clients differentiated, high-touch service. We are pleased to have reached an agreement and look forward to welcoming Geneva Advisors' clients and strong team to our bank."
"Bringing together these two companies is a win for our clients," said John Huber, Principal & Portfolio Manager, Geneva Advisors. "From our founding in 2003 to today, our focus has been to offer objective and unbiased investment management decisions. We are proud of this philosophy and our tremendous team that has consistently grown Geneva Advisors and provided exceptional value to our clients."
"CIBC shares our client-focused culture and team-based approach," said Bob Bridges, Principal & Portfolio Manager, Geneva Advisors. "We have a common belief that by putting our clients' needs first, we are able to build trusted and long-lasting relationships. We look forward to becoming part of the CIBC team and enhancing the value we offer to our clients."
Under the terms of the agreement, CIBC will acquire Geneva Advisors for up to US$200 million, of which US$135 million will be paid at closing and US$65 million is contingent on future performance conditions being met. The total purchase price including contingent consideration will be paid 25% in cash and 75% in the form of CIBC common shares. The transaction is expected to close in the fourth quarter of fiscal 2017, subject to the satisfaction of customary closing conditions, including receipt of regulatory approvals. The deal is expected to reduce CIBC's Common Equity Tier 1 Capital Ratio by approximately 6 basis points at closing and become accretive to CIBC's earnings per share in fiscal 2019. Upon completion of the transaction, CIBC will have approximately US$50 billion in assets under administration in the U.S. on a pro forma basis.
CIBC is a leading Canadian-based global financial institution with 11 million personal banking, business, public sector and institutional clients. Across Personal and Small Business Banking, Commercial Banking and Wealth Management, and Capital Markets businesses, CIBC offers a full range of advice, solutions and services through its leading digital banking network, and locations across Canada, in the United States and around the world. Ongoing news releases and more information about CIBC can be found at www.cibc.com/ca/media-centre/.
Certain statements contained in this communication may be deemed to be forward-looking statements under certain securities laws. All such statements are made pursuant to the "safe harbor" provisions of, and are intended to be forward-looking statements under applicable Canadian and U.S. securities legislation, including the United States Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, any statements about the expected effects of the acquisition Geneva Advisors by CIBC including any expected impact on CIBC's earnings, Common Equity Tier 1 ratio or other statements other than in relation to historical facts, statements about the operations, business lines, financial condition, risk management, priorities, targets, ongoing objectives, strategies of Geneva Advisors and CIBC and the regulatory environment in which they operate and outlook for calendar year 2017 and subsequent periods. 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This list is not exhaustive of the factors that may affect any of our forward-looking statements. These and other factors should be considered carefully and readers should not place undue reliance on our forward-looking statements. Additional information about these factors can be found in the "Management of risk" section starting on page 40 of our 2016 Annual Report. Any forward-looking statements contained in this communication represent the views of management only as of the date hereof and are presented for the purpose of assisting our stockholders and financial analysts in understanding our financial position, objectives and priorities and anticipated financial performance as at and for the periods ended on the dates presented, and may not be appropriate for other purposes. We do not undertake to update any forward-looking statement that is contained in this communication or in other communications except as required by law.
SOURCE CIBC - Corporate
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