Canada’s prominent providers Desjardins and Canadian Imperial Bank of Commerce (CIBC) have yielded mixed results for the second and third quarter of 2020, respectively.

CIBC has reported a quarter-over-quarter variance of 199% in reported net income standing at CAD$1.17 billion (US$890m) from CAD$392m. It suffered a year-over-year variance of -16% with its Q3 19 figure totalling CAD$1.4 billion.

Adjusted net income stood at CAD$1.24 billion representing a 182% increase from the previous quarter’s figure of CAD$441m but a 12% drop, year-over-year from CAD$1.42 billion.

US commercial banking and wealth management reported a net income of CAD$62 million for the third quarter, down 64% from the same period a year ago.

Capital Markets reported net income of $392 million for the third quarter, up 67% from the third quarter a year ago. This was driven by higher revenues, partially offset by higher non-interest expenses and a higher provision for credit losses.

Pre-provision earnings were up 62% from a year ago, driven by higher revenue across interest rate and commodities trading, lower credit and funding valuation adjustments, higher financing activities, corporate banking and underwriting revenue. These increases were partially offset by lower advisory and foreign exchange trading revenue.

Total revenues are valued at CAD$4.71 billion for the quarter and CAD$14.14 billion for the first half of the year.

SRP data shows that CIBC has boosted its structured product issuance to 166 in the period of April-June 2020. This is a climb from the previous quarter’s figure of 156 as well as that of the same period of 2019, 159. It is currently the second most prolific player in the market with Bank of Montreal ahead (287 products).

CIBC has a total of 2,371 live products listed domestically, in the US and as institutional investments. Wrappers consist of notes, PPNs, GICs and unlisted registered notes while some underlyings include the S&P500, Bank of Nova Scotia, S&P/TSX 60 Index, and Eurostoxx 50. The products differ in maturity and the most popular asset classes are single index equities, interest rate, fund, and hybrid.

Desjardins’ reported net interest income remains unchanged from the previous quarter of 2020 at CAD$1.35 billion though this does reflect an increase from CAD$1.29 billion in the second quarter of 2019.

The bank has boosted its total income of CAD$6.12 billion from CAD$4.7 billion in Q2 19. Total income for the first half of 2020 stands at CAD$11.32 billion.

Desjardins recorded surplus earnings before member dividends of CAD$814m, down 25.5% from the same period in 2019. The negative financial consequences of the COVID-19 pandemic impacted surplus earnings for the first half of the year.

These consequences include a CAD$497m increase in provision for credit losses as a result of the deterioration in the economic outlook and an uptick in credit balance insurance provisions.

The bank’s wealth management division posted CAD$261m in net surplus earnings, up CAD$82m from the corresponding period in 2019. Personal and business services reported a slide in surplus earnings before member dividends of CAD$337m a CAD$128m drop from Q2 19.

Desjardins issued a total of 95 structured products for the quarter, a 25% increase from its Q1 20 figure of 76 and flat compared to the 94 products issued in Q2 19. Desjardins Group has 1,591 live tranche investments that are listed domestically. The products are wrapped as GICs and notes and underlyings include Thompson Reuters, Power Corporation of Canada, BCE, and Rogers Communications.

The products range in tenor and belong to several asset classes, some of which are share basket equities and hybrids. 

Click to view the earnings for CIBC and Desjardins.