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Preferred Share Description
Canadian Imperial Bank of Commerce (CM.PR.O)
3.90% Non-Cumulative, Redeemable, Rate Reset, NVCC*, Class A preferred shares, Series 39
Prospectus - June 2, 2014
DBRS Credit Rating: June 1, 2018 - DBRS confirmed the ratings of Canadian Imperial Bank of Commerce and its related entities, including CIBC’s Long-Term Issuer Rating at AA and Short-Term Issuer Rating at R-1 (high). CIBC’s Long-Term Deposits and Long-Term Senior Debt ratings of AA are composed of an Intrinsic Assessment (IA) of AA (low) and a Support Assessment (SA) of SA2, reflecting the expectation of timely, systemic support from the Government of Canada (rated AAA with a Stable trend by DBRS). The SA2 designation results in a one-notch benefit to the Long-Term Deposits and Long-Term Senior Debt ratings. The trend on all instruments remains Stable, reflecting the finalization of the Canadian Bank Recapitalization Regime (the Bail-In Regime) and DBRS’s view that a sufficient level of bail-inable senior debt will provide an adequate buffer for non-bail-inable obligations, which will offset the expected removal of systemic support (see press release “DBRS Takes Rating Actions on Six Canadian Banking Groups after Finalization of Bail-In Regime,” April 19, 2018).
Important Note: NVCC preferred shares have a lower credit rating than other CIBC preferred share issues. DBRS assigned the NVCC Preferred Shares Series 39 a rating equal to the Bank’s intrinsic assessment less four rating notches because the Series 39 has only an Office of the Superintendent of Financial Institutions (OSFI)-compliant non-viable contingent capital (NVCC) trigger, which is consistent with the OSFI requirements for NVCC instruments, and no additional triggers.
*NVCC is short for Non-Viability Contingent Capital and it refers to the issuer's ability to convert the preferred shares into common shares if a "Trigger Event" occurs. See "Convertible by Company" section below for the definition of a trigger event.
- DBRS Rating
- Pfd-2 Stable Trend
- DBRS Rating Date
- Shares Issued
- Issued Date
- Shares O/S
- O/S Date
- $0.975 per share per year
- Dividend Dates
- Payable on the 28th day of January, April, July and October.
- Dividend Details
- The share's dividend rate is fixed until July 31, 2019. On July 31, 2019 and on January 31st every 5 years thereafter, the dividend rate will be calculated and reset as the sum of the the 5-year Government of Canada Bond Yield (GCAN5YR) plus 2.32%.
- The Series 39 shares will not be redeemable prior to July 31, 2019. The series 39 shares are redeemable by the company on July 31, 2019 and on January 31st every 5 years thereafter at a rate of $25 cash for each series 39 preferred share.
- Holders of the Series 39 Rate-Reset preferred shares will have the right to convert their shares into an equal number of the Series 40 Floating-Rate preferred shares on July 31, 2019 and on January 31st every five years thereafter. The Series 40 Floating-Rate shares will calculate and pay a dividend quarterly equal to the sum of the Government of Canada 3-month T-Bill Rate plus 2.32%. On July 31, 2024 and on January 31st every five years thereafter holders of the Series 40 Floating-Rate preferred shares will have the right to convert their shares into an equal number of the Series 39 Rate-Reset preferred shares.
- Lead Underwriter(s)
- CIBC World Markets, BMO Nesbitt Burns
- Transfer Agent
- CST Trust Company
- CST Trust Company
- Dividend Reinvestment Plan
- Registered holders of the preferred shares are eligible to participate in the Dividend Reinvestment Plan for the purchase of common shares. For more information, visit Shareholder investment Plans at https://www.cibc.com/ca/investor-relations/share-info/preferred-shares.html
- Convertible by Company
- The company can force Series 39 and 40 shareholders to convert their shares into the company's common shares upon the occurrence of a "Trigger Event". For more details, refer to the share's prospectus.
- Corporate Action
- CIBC (CM: TSX, NYSE) is a leading Canadian-based financial institution with a market capitalization of $50 billion and a Basel III Common Equity Tier 1 capital ratio of 11.2%. Through our four strategic business units – Canadian Personal and Small Business Banking, Canadian Commercial Banking and Wealth Management, U.S. Commercial Banking and Wealth Management, and Capital Markets – our nearly 45,000 employees provide a full range of financial products and services to 11 million individual, small business, commercial, corporate, and institutional clients in Canada, the U.S. and around the world.
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