Canada’s CIBC plans international banking business in Dublin

Canadian Imperial Bank of Commerce (CIBC), the country’s fifth-largest lender, is working on plans to set up an international banking operation in Dublin, which will initially involve the creation of scores of jobs, according to sources.

The group previously had a Dublin-registered unit, CIBC World Markets Securities Ireland, which had no employees and was a direct subsidiary of a Cayman Islands-based company. The Irish company, which described itself in regulatory filings as being involved in equity and equity derivatives trading, was wound down in 2015. It’s most recent report showed it had $78.7 million (€75 million) of assets at the end of 2013.

CIBC is best known in this State for having made an informal approach to buy a stake in AIB in 2009, months after the then-ailing Irish lender had received an initial €3.5 billion bailout from the State. Nothing emerged from that flirtation and the taxpayer bill for AIB subsequently soared to €20.8 billion by the middle of 2011.

It is understood that CIBC's current plan is to set up a more international business in Ireland. It comes at a time when a number of financial firms in London, where CIBC also has a presence, are considering moving operations to this State in the wake of the UK's decision in June to exit the European Union. Brexit, depending on the eventual shape of the divorce settlement, could lead to Britain losing the right to passport financial services into the EU – ie conduct business across the EU under its UK certification.

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Employees and assets

A spokeswoman for CIBC wasn’t in a position to comment on Friday on the Irish plans. Toronto-based CIBC had more than 43,200 employees and assets of 501.4 billion Canadian dollars at the end of its last financial year, in October.

The group’s main focus in the past six months has been on trying to conclude the takeover of Chicago-based lender PrivateBancorp, which it agreed to acquire in June for $3.8 billion in an effort to expand its commercial and private banking business in the United States.

PrivateBancorp, which has about $19 billion in assets, postponed a December 8th shareholder vote on the purchase after some investors and shareholder advisory firms called the offer insufficient following a surge in the value of US regional lenders in the wake of Donald Trump’s election in November as the country’s next president.

However, CIBC chief executive Victor Dodig insisted last month that he was sticking by the cash-and-stock bid for PrivateBancorp, saying he is prepared to wait out the market rally to complete the deal.