The United States real estate crisis has receded. Canadian Imperial Bank of Commerce's (CM.US) Q4 performance exceeds expectations.

Canadian Imperial Bank of Commerce (CM.US) on Thursday announced better-than-expected performance in the fourth quarter of its fiscal year 2024, with credit quality once again exceeding market expectations and signs of recovery in its U.S. operations in the commercial real estate sector. The data shows that the Toronto-based bank reported adjusted earnings per share of 1.91 Canadian dollars for the fourth quarter, beating market expectations of 1.79 Canadian dollars. The bank set aside 419 million Canadian dollars (equivalent to 298 million U.S. dollars) for credit losses, significantly lower than analysts' forecast of 547 million Canadian dollars, a 23% decrease from the same period in 2023. This trend started earlier this year for the fifth-largest bank in Canada. Canadian Imperial Bank of Commerce stated in its Thursday release that despite worsening economic prospects, credit conditions have improved. Earlier this week, competitors Royal Bank of Canada (RY.US) and Bank of Nova Scotia (BNS.US) also reported lower-than-expected credit loss provisions. The improvement in U.S. operations drove a significant increase in profits for Canadian Imperial Bank of Commerce In May of this year, Canadian Imperial Bank of Commerce reached an agreement to sell a portfolio of U.S. office building loans at a discount of 316 million U.S. dollars, as these loans had previously dragged down profits due to credit losses. In the fourth quarter, the bank's U.S. commercial banking division saw a 67% decrease in credit loss provisions year-over-year, leading to a three-fold increase in net profit. For the fourth quarter ending on October 31, the bank reported adjusted overall profits of 1.9 billion Canadian dollars, a 24% increase from the same period last year, with a return on equity of 13.4%. Canadian Imperial Bank of Commerce also benefited from the thriving stock market, with market-related expenses (including mutual funds and other investment management fees) increasing by 24% to 2.1 billion Canadian dollars. Excluding trading income, market-related expenses grew by 19%. In fiscal year 2024, Canadian Imperial Bank of Commerce saw a 10% increase in total revenue, with adjusted profits growing by 12% to 7.3 billion Canadian dollars. All departments except the capital markets division saw growth in net profits. Royal Bank of Canada's capital markets analyst, Darko Mihelic, stated that this outcome "puts a strong punctuation mark on the year." Canadian Imperial Bank of Commerce raised its quarterly dividend by 7.8% to 0.97 Canadian dollars per share. Jefferies Financial Group Inc. analyst John Aiken stated, "This is the largest dividend increase to date, highlighting management's confidence in the outlook." In pre-market trading on Thursday, Canadian Imperial Bank of Commerce stock rose nearly 3%.