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Preferred Share Description
Canadian Imperial Bank of Commerce (CM.PR.R)
4.40% Non-Cumulative, Redeemable, Rate-Reset, NVCC*, Class A Preferred Shares, Series 45
Prospectus - May 26, 2017
DBRS Credit Rating: May 28, 2019 - 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). The trend on all ratings is Stable.
CIBC’s Long-Term Issuer Rating is composed of an Intrinsic Assessment of AA (low) and a Support Assessment (SA) of SA2, which reflects 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 uplift to the Long-Term Issuer Rating. Under the new Canadian Bank Recapitalization Regime, DBRS expects to eventually remove the uplift from systemic support once the Bank has issued a sufficient level of bail-inable senior debt, which would provide an adequate buffer for non-bail-inable obligations and is expected to offset the removal of systemic support.
Important Note: NVCC preferred shares have a lower credit rating than other CIBC preferred share issues. DBRS assigned the NVCC Preferred Shares Series 45 a rating equal to the Bank’s intrinsic assessment less four rating notches because the Series 45 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
- $1.10 per share per year
- Dividend Dates
- The dividend is payable quarterly on the 28th day of January, April, July and October
- Dividend Details
- The share's dividend rate is fixed until July 31, 2022. On July 31, 2022 and on July 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 3.38%.
- The shares are not redeemable prior to July 31, 2022. On July 31, 2022 and on July 31st every 5 years thereafter the shares are redeemable by the company at $25.00 per share.
- Holders of the Series 45 Rate-Reset preferred shares will have the right to convert their shares into an equal number of the Series 46 Floating-Rate preferred shares on July 31, 2022 and on July 31st every five years thereafter. The Series 46 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 3.38%. On July 31, 2027 and on July 31st every five years thereafter holders of the Series 46 Floating-Rate preferred shares will have the right to convert their shares into an equal number of the Series 45 Rate-Reset preferred shares.
- Lead Underwriter(s)
- CIBC World Markets, National Bank Financial, Scotia Capital
- 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 45 and 46 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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