# Management's discussion and analysis Management's discussion and analysis (MD&A) is provided to enable readers to assess CIBC's financial condition and results of operations as at and for the year ended October 31, 2025, compared with prior years. The MD&A should be read in conjunction with the audited consolidated financial statements. Unless otherwise indicated, all financial information in this MD&A has been prepared in accordance with International Financial Reporting Standards (IFRS or GAAP) and all amounts are expressed in Canadian dollars. Certain disclosures in the MD&A have been shaded as they form an integral part of the consolidated financial statements. The MD&A is current as of December 3, 2025. Additional information relating to CIBC, including the Annual Information Form, is available on SEDAR+ at www.sedarplus.com and on the United States (U.S.) Securities and Exchange Commission's (SEC) website at www.sec.gov. No information on CIBC's website (www.cibc.com) should be considered incorporated herein by reference. A glossary of terms used in the MD&A and the audited consolidated financial statements is provided on pages 94 to 100 of this Annual Report. | Section | Page | |---|---| | **2 External reporting changes** | 2 | | **Overview** | 2 | | **Our strategy** | 2 | | **Performance against objectives** | 2 | | **4 Financial highlights** | 4 | | **5 Economic and market environment** | 5 | | **Year in review - 2025** | 5 | | **Outlook for calendar year 2026** | 5 | | **5 Significant events** | 5 | | **6 Financial performance overview** | 6 | | **2025 Financial results review** | 6 | | **Net interest income and margin** | 6 | | **Non-interest income** | 7 | | **Trading revenue** | 7 | | **Provision for credit losses** | 8 | | **Non-interest expenses** | 8 | | **Taxes** | 9 | | **Foreign exchange** | 9 | | **Fourth quarter review** | 9 | | **10 Quarterly trend analysis** | 10 | | **Review of 2024 financial performance** | 11 | | **13 Non-GAAP measures** | 13 | | **16 Strategic business units overview** | 16 | | **Canadian Personal and Business Banking** | 17 | | **Canadian Commercial Banking and Wealth Management** | 20 | | **U.S. Commercial Banking and Wealth Management** | 23 | | **Capital Markets** | 26 | | **42 Management of risk** | 42 | | **82 Accounting and control matters** | 82 | | **Critical accounting policies and estimates** | 82 | | **Accounting developments** | 86 | | **Other regulatory developments** | 86 | | **Related-party transactions** | 86 | | **Policy on the Scope of Services of the Shareholders' Auditor** | 87 | | **Controls and procedures** | 87 | | **88 Supplementary annual financial information** | 88 | | **94 Glossary** | 94 | **A NOTE ABOUT FORWARD-LOOKING STATEMENTS:** From time to time, we make written or oral forward-looking statements within the meaning of certain securities laws, including in this Annual Report, in other filings with Canadian securities regulators or the SEC and in other communications. All such statements are made pursuant to the "safe harbour" provisions of, and are intended to be forward-looking statements under applicable Canadian and U.S. securities legislation, including the U.S. Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, statements made in the "Message from the President and Chief Executive Officer", "Overview - Performance against objectives", "Economic and market environment - Outlook for calendar year 2026", "Significant events", "Financial performance overview - Taxes", "Strategic business units overview - Canadian Personal and Business Banking", "Strategic business units overview - Canadian Commercial Banking and Wealth Management", "Strategic business units overview - U.S. Commercial Banking and Wealth Management", "Strategic business units overview - Capital Markets", "Financial condition - Capital management", "Financial condition - Off-balance sheet arrangements", "Management of risk - Risk overview", "Management of risk - Top and emerging risks", "Management of risk - Credit risk", "Management of risk - Market risk", "Management of risk - Liquidity risk", "Accounting and control matters - Critical accounting policies and estimates", "Accounting and control matters - Accounting developments", "Accounting and control matters - Other regulatory developments" and "Accounting and control matters - Controls and procedures" sections of this report and other statements about our operations, business lines, financial condition, risk management, priorities, targets and sustainability commitments (including with respect to our sustainability ambitions and our environmental, social and governance (ESG) related activities), ongoing objectives, strategies, the regulatory environment in which we operate and outlook for calendar year 2026 and subsequent periods. Forward-looking statements are typically identified by the words "believe", "expect", "anticipate", "intend", "estimate", "forecast", "target", "predict", "commit", "ambition", "goal", "strive", "project", "objective" and other similar expressions or future or conditional verbs such as "will", "may", "should", "would" and "could". By their nature, these statements require us to make assumptions, including the economic assumptions set out in the "Economic and market environment - Outlook for calendar year 2026" section of this report, and are subject to inherent risks and uncertainties that may be general or specific. Given the potential negative economic impacts tied to the actual and proposed U.S. imposition of tariffs on Canada and other countries and their countermeasures, the softening labour market and uncertain political conditions in the U.S., the continuing impact of hybrid work arrangements and high interest rates on the U.S. real estate sector, and the war in Ukraine and conflict in the Middle East on the global economy, financial markets, and our business, results of operations, reputation and financial condition, there is inherently more uncertainty associated with our assumptions as compared to prior periods. A variety of factors, many of which are beyond our control, affect our operations, performance and results, and could cause actual results to differ materially from the expectations expressed in any of our forward-looking statements. These factors include: trade policies and tensions, including tariffs; inflationary pressures in the U.S.; global supply-chain disruptions; geopolitical risk, including from the war in Ukraine and conflict in the Middle East; the impact of post-pandemic hybrid work arrangements; credit, market, liquidity, strategic, insurance, operational, reputation, conduct and legal, regulatory and environmental risk; currency value and interest rate fluctuations, including as a result of market and oil price volatility; the effectiveness and adequacy of our risk management and valuation models and processes; legislative or regulatory developments in the jurisdictions where we operate, including the Organisation for Economic Co-operation and Development Common Reporting Standard, and regulatory reforms in the United Kingdom and Europe, the Basel Committee on Banking Supervision's global standards for capital and liquidity reform, and those relating to bank recapitalization legislation and the payments system in Canada; amendments to, and interpretations of, risk-based capital guidelines and reporting instructions, and interest rate and liquidity regulatory guidance; exposure to, and the resolution of, significant litigation or regulatory matters, our ability to successfully appeal adverse outcomes of such matters and the timing, determination and recovery of amounts related to such matters; the effect of changes to accounting standards, rules and interpretations; changes in our estimates of reserves and allowances; changes in tax laws; changes to our credit ratings; political conditions and developments, including changes relating to economic or trade matters such as tariffs; the possible effect on our business of international conflicts, such as the war in Ukraine and conflict in the Middle East, and terrorism; natural disasters, disruptions to public infrastructure and other catastrophic events; the occurrence of public health emergencies and any related government policies and actions; reliance on third parties to provide components of our business infrastructure; potential disruptions to our information technology systems and services; increasing cyber security risks, which may include theft or disclosure of assets, unauthorized access to sensitive information, or operational disruption; social media risk; losses incurred as a result of internal or external fraud; anti-money laundering; the accuracy and completeness of information provided to us concerning clients and counterparties; the failure of third parties to comply with their obligations to us and our affiliates or associates; intensifying competition from established competitors and new entrants in the financial services industry, including through internet and mobile banking; technological change, including the use of data and artificial intelligence (AI) in our business; the heavy reliance on AI-related capital spending for U.S. growth and the uncertain employment impacts from its adoption; global capital market activity; changes in monetary and economic policy; general business and economic conditions worldwide, as well as in Canada, the U.S. and other countries where we have operations, including increasing Canadian household debt levels and global credit risks; climate change and other ESG-related risks, including our ability to implement various sustainability-related initiatives internally and with our clients under expected time frames and our ability to scale our sustainable finance products and services; our success in developing and introducing new products and services, expanding existing distribution channels, developing new distribution channels and realizing increased revenue from these channels; changes in client spending and saving habits; our ability to attract and retain key employees and executives; our ability to successfully execute our strategies and complete and integrate acquisitions and joint ventures; the risk that expected benefits of an acquisition, merger or divestiture will not be realized within the expected time frame or at all; and our ability to anticipate and manage the risks associated with these factors. This list is not exhaustive of the factors that may affect any of our forward-looking statements. These and other factors should be considered carefully and readers should not place undue reliance on our forward-looking statements. Any forward-looking statements contained in this report represent the views of management only as of the date hereof and are presented for the purpose of assisting our shareholders and financial analysts in understanding our financial position, objectives and priorities and anticipated financial performance as at and for the periods ended on the dates presented, and may not be appropriate for other purposes. We do not undertake to update any forward-looking statement that is contained in this report or in other communications except as required by law. 1 CIBC 2025 ANNUAL REPORT # Management's discussion and analysis ## External reporting changes The following external reporting changes were made in 2025. ### Changes made to our business segments * Our Simplii Financial direct banking business and Investor's Edge direct investing business, previously reported in Capital Markets and Direct Financial Services were realigned with Canadian Personal and Business Banking and Canadian Commercial Banking and Wealth Management, respectively; and * Our CIBC Cleary Gull U.S. mid-market investment banking business was realigned from Capital Markets to U.S. Commercial Banking and Wealth Management. Prior period amounts were restated accordingly. While the changes impacted the results of our strategic business units (SBUs) and how we measure the performance of our SBUs, there was no impact on our consolidated financial results from these changes. ## Overview CIBC is a leading and well-diversified North American financial institution committed to creating enduring value for all our stakeholders – our clients, team, communities and shareholders. We are guided by our purpose – to help make your ambition a reality, and we are deploying our resources to create positive change and contribute to a more secure, equitable and sustainable future. Across our bank and our businesses – Personal and Business Banking, Commercial Banking and Wealth Management, and Capital Markets – our 50,000 employees bring our purpose to life every day for our 15 million personal banking, business, public sector and institutional clients in Canada, the U.S. and around the world. ## Our strategy Throughout 2025, we continued to execute on our strategy with a goal of delivering exceptional client experience and top-tier shareholder returns while maintaining our financial strength, risk discipline, and advancing our purpose-driven culture. Going forward, we will continue to drive further long-term growth and build on our momentum with a client-focused, connected, and performance-driven approach, that is underpinned by our four strategic priorities: * Growing our mass affluent and private wealth franchise; * Expanding our digital-first personal banking capabilities; * Delivering connectivity and differentiation to our clients; and * Enabling, simplifying and protecting our bank. ## Performance against objectives CIBC reports a scorecard of financial measures that we use to evaluate and report on our progress to external stakeholders. These measures can be categorized into four key areas – earnings growth, operating leverage, shareholder profitability and return, and balance sheet strength. We have set through the cycle targets for each of these measures, which we currently define as three to five years, assuming a normal business environment and credit cycle. Our ability to achieve these objectives may be adversely affected by extraordinary developments and disruptions. Fiscal 2025 saw decelerating Canadian economic growth with higher unemployment, elevated tariffs in some sectors, and geopolitical pressures. This was offset by strong but volatile financial markets and stimulative monetary policy. In spite of these challenges, we delivered strong performance across all of our SBUs. ### Earnings growth To assess our earnings growth, we monitor our earnings per share (EPS). In 2025, our reported and adjusted $^{(1)}$ EPS was \$8.57 and \$8.61, respectively, compared with \$7.28 and \$7.40, respectively, in 2024. Against a backdrop of a challenging economic environment, our year-over-year reported and adjusted $^{(1)}$ diluted EPS was up by 18% and 16%, respectively. Going forward, we will continue to target an adjusted $^{(1)}$ diluted EPS growth rate of 7% to 10% through the cycle. | | Reported diluted EPS ($\$) | Adjusted diluted EPS ($\$) | |---|---|---| | **24** | 7.28 | 7.40 | | **25** | 8.57 | 8.61 | ### Operating leverage Operating leverage, defined as the difference between the year-over-year percentage change in revenue and year-over-year percentage change in non-interest expenses, is a measure of the relative growth rates of revenue and expenses. In 2025, our reported and adjusted $^{(1)}$ operating leverage was 4.0% and 3.1%, respectively, compared with 9.1% and 1.2%, respectively, in 2024. Going forward, we will continue to target positive adjusted$^{(1)}$ operating leverage through the cycle. | | Reported operating leverage (%) | Adjusted operating leverage (%) | |---|---|---| | **24** | 9.1 | 1.2 | | **25** | 4.0 | 3.1 | $^{(1)}$ Adjusted measures are non-GAAP measures. For additional information and a reconciliation of reported results to adjusted results, where applicable, see the "Non-GAAP measures" section. 2 CIBC 2025 ANNUAL REPORT ## Shareholder profitability and return We have three metrics to measure shareholder profitability and return: 1. Return on common shareholders' equity (ROE) ROE, defined as the ratio of net income to average $^{(2)}$ common shareholders' equity, is a key measure of profitability. In 2025, our reported and adjusted $^{(1)}$ ROE were at 14.3% and 14.4%, respectively, compared with 13.4% and 13.7% in 2024, respectively, and below our through the cycle target of 15%+, driven mainly by higher regulatory capital requirements. Going forward, we will continue to target an adjusted $^{(1)}$ ROE of 15%+ through the cycle. | | ROE (%) | Adjusted ROE (%) | |---|---|---| | **24** | 13.4 | 13.7 | | **25** | 14.3 | 14.4 | 2. Dividend payout ratio Dividend payout ratio is defined as the ratio of common share dividends paid as a percentage of net income after preferred share dividends, premiums on preferred share redemptions, and distributions on other equity instruments. Key criteria for considering dividend increases are our current level of payout relative to our target and our view on the sustainability of our current earnings level. In 2025, our reported and adjusted $^{(1)}$ dividend payout ratios were 45.0% and 44.8%, respectively, compared with 49.4% and 48.5% in 2024, respectively. Going forward, we will continue to target an adjusted$^{(1)}$ dividend payout ratio of 40% to 50% through the cycle. | | Reported dividend payout ratio (%) | Adjusted dividend payout ratio (%) | |---|---|---| | **24** | 49.4 | 48.5 | | **25** | 45.0 | 44.8 | 3. Total shareholder return (TSR) TSR is the ultimate measure of shareholder value, and the output of delivering against the financial targets within our control. We continue to have an objective to deliver a TSR that exceeds the industry average, which we have defined as the Standard & Poor's (S&P)/Toronto Stock Exchange (TSX) Composite Banks Index, over rolling three- and five-year periods. For the three years ended October 31, 2025, our TSR was 119.5% (2024: 36.4%), which was above the S&P/TSX Composite Banks Index of 73.7%. For the five years ended October 31, 2025, our TSR was 199.8% (2024: 102.9%), which was above the S&P/TSX Composite Banks Index return over the same period of 159.1%. ```mermaid gantt title Rolling three-year TSR (%) dateFormat YYYY-MM-DD section CIBC CIBC 119.5%: 2023-11-01, 1175d section S&P/TSX Composite Index S&P/TSX Composite Index 70.7%: 2023-11-01, 1175d section S&P/TSX Composite Banks Index S&P/TSX Composite Banks Index 73.7%: 2023-11-01, 1175d ``` *Oct-24 Jan-25 Apr-25 Jul-25 Oct-25* ```mermaid gantt title Rolling five-year TSR (%) dateFormat YYYY-MM-DD section CIBC CIBC 199.8%: 2021-11-01, 1461d section S&P/TSX Composite Index S&P/TSX Composite Index 125.4%: 2021-11-01, 1461d section S&P/TSX Composite Banks Index S&P/TSX Composite Banks Index 159.1%: 2021-11-01, 1461d ``` *Oct-24 Jan-25 Apr-25 Jul-25 Oct-25* ## Balance sheet strength Maintaining a strong balance sheet is foundational to our long-term success. Our goal is to maintain strong capital and liquidity positions. We look to constantly balance our objectives of holding a prudent amount of excess capital for unexpected events and environmental uncertainties, investing in our core businesses, growing through acquisitions and returning capital to our shareholders. 1. Common Equity Tier 1 (CET1) ratio We actively manage our capital to maintain a strong and efficient capital base while supporting our business growth and returning capital to our shareholders. For the year ended October 31, 2025, our CET1$^{(3)}$ ratio was 13.3%, compared with 13.3% in 2024, well above the current regulatory requirement set by the Office of the Superintendent of Financial Institutions (OSFI). Going forward, we will continue to maintain a strong buffer to regulatory requirements. | | CET1 ratio (%) | |---|---| | **24** | 13.3 | | **25** | 13.3 | 2. Liquidity coverage ratio (LCR) Our ability to meet our near-term financial obligations is measured through the LCR. It measures unencumbered high-quality liquid assets (HQLA) that can be converted into cash to meet liquidity needs in a 30-calendar-day liquidity stress scenario. The LCR standard requires that, absent a situation of financial stress, the value of the ratio be no lower than 100%. For the quarter ended October 31, 2025, our three-month daily average LCR$^{(3)}$ was 132% compared to 129% for the same period last year. | | LCR (%) | |---|---| | **24** | 129 | | **25** | 132 | $^{(1)}$ Adjusted measures are non-GAAP measures. For additional information and a reconciliation of reported results to adjusted results, where applicable, see the "Non-GAAP measures" section. $^{(2)}$ Average balances are calculated as a weighted average of daily closing balances. $^{(3)}$ Our capital ratios are calculated pursuant to OSFI's Capital Adequacy Requirements (CAR) Guideline and the LCR is calculated pursuant to OSFI's Liquidity Adequacy Requirements (LAR) Guideline, which are both based on Basel Committee on Banking Supervision (BCBS) standards. For additional information, see the "Capital management" and "Liquidity risk" sections. 3 CIBC 2025 ANNUAL REPORT # Financial highlights As at or for the year ended October 31 | Financial results (\$ millions) | 2025 | 2024 | |---|---|---| | Net interest income | \$ 15,769 | \$ 13,695 | | Non-interest income | 13,364 | 11,911 | | Total revenue | 29,133 | 25,606 | | Provision for credit losses | 2,342 | 2,001 | | Non-interest expenses | 15,852 | 14,439 | | Income before income taxes | 10,939 | 9,166 | | Income taxes | 2,485 | 2,012 | | Net income | 8,454 | 7,154 | | Net income attributable to non-controlling interests | 25 | 39 | | Preferred shareholders and other equity instrument holders | 364 | 263 | | Common shareholders | 8,065 | 6,852 | | Net income attributable to equity shareholders | \$ 8,429 | \$ 7,115 | | **Financial measures** | | | | Reported efficiency ratio $^{(1)}$ | 54.4% | 56.4% | | Reported operating leverage $^{(1)}$ | 4.0% | 9.1% | | Loan loss ratio $^{(1)}$ | 0.33% | 0.32% | | Reported return on common shareholders' equity $^{(1)}$ | 14.3% | 13.4% | | Net interest margin $^{(1)}$ | 1.43% | 1.36% | | Net interest margin on average interest-earning assets $^{(1)(2)}$ | 1.55% | 1.47% | | Return on average assets $^{(1)(2)}$ | 0.77% | 0.71% | | Return on average interest-earning assets $^{(1)(2)}$ | 0.83% | 0.77% | | Reported effective tax rate | 22.7% | 21.9% | | **Common share information** | | | | Per share (\$) | | | | basic earnings | 8.62 | 7.29 | | reported diluted earnings | 8.57 | 7.28 | | book value $^{(1)}$ | 57.08 | 57.08 | | Shares outstanding (thousands) | | | | weighted-average basic | 935,374 | 939,352 | | weighted-average diluted | 940,675 | 941,712 | | end of period | 926,614 | 942,295 | | Market capitalization (\$ millions) | \$ 107,682 | \$ 82,083 | | **Value measures** | | | | Total shareholder return | | | | reported diluted earnings | 39.05% | 87.56% | | dividends | 3.3% | 4.1% | | book value $^{(1)}$ | 45.0% | 49.4% | | Dividend yield (based on closing share price) | 1.86 | 1.53 | | Reported dividend payout ratio $^{(1)}$ | 45.0% | 49.4% | | **Selected financial measures - adjusted $^{(3)}$** | | | | Adjusted efficiency ratio | 54.3% | 55.8% | | Adjusted operating leverage | 3.1% | 1.2% | | Adjusted return on common shareholders' equity | 14.4% | 13.7% | | Adjusted effective tax rate | 22.7% | 22.0% | | Adjusted diluted earnings per share (\$) | \$ 8.61 | \$ 7.40 | | Adjusted dividend payout ratio | 44.8% | 48.5% | | **On- and off-balance sheet information (\$ millions)** | | | | Cash, deposits with banks and securities | \$ 327,238 | \$ 302,409 | | Loans and acceptances, net of allowance for credit losses | 589,504 | 558,292 | | Total assets | 1,116,938 | 1,041,985 | | Deposits | 808,124 | 764,857 | | Common shareholders' equity $^{(1)}$ | 57,760 | 53,789 | | Average assets $^{(2)}$ | 1,104,285 | 1,005,133 | | Average interest-earning assets $^{(1)(2)}$ | 1,015,644 | 929,604 | | Average common shareholders' equity $^{(1)(2)}$ | 56,321 | 51,025 | | Assets under administration (AUA) $^{(1)(4)(5)}$ | 3,998,199 | 3,600,069 | | Assets under management (AUM) $^{(1)(5)}$ | 430,982 | 383,264 | | **Balance sheet quality (All-in basis) and liquidity measures $^{(6)}$** | | | | Risk-weighted assets (RWA) (\$ millions) | | | | Total RWA | \$ 357,803 | \$ 333,502 | | Capital ratios | | | | CET1 ratio | 13.3% | 13.3% | | Tier 1 capital ratio | 15.1% | 14.8% | | Total capital ratio | 17.4% | 17.0% | | Leverage ratio | 4.3% | 4.3% | | Total loss absorbing capacity (TLAC) ratio | 31.9% | 30.3% | | TLAC leverage ratio | 9.0% | 8.7% | | LCR $^{(7)}$ | 132% | 129% | | Net stable funding ratio (NSFR) | 116% | 115% | | **Other information** | | | | Full-time equivalent employees | 49,824 | 48,525 | $^{(1)}$ For additional information on the composition of these specified financial measures, see the "Glossary" section. $^{(2)}$ Average balances are calculated as a weighted average of daily closing balances. $^{(3)}$ Adjusted measures are non-GAAP measures. Adjusted measures are calculated in the same manner as reported measures, except that financial information included in the calculation of adjusted measures is adjusted to exclude the impact of items of note. For additional information and a reconciliation of reported results to adjusted results, where applicable, see the "Non-GAAP measures" section. $^{(4)}$ Includes the full contract amount of AUA or custody under a 50/50 joint venture between CIBC and The Bank of New York Mellon of \$3,117.4 billion as at October 31, 2025 (2024: \$2,814.6 billion). $^{(5)}$ AUM amounts are included in the amounts reported under AUA. $^{(6)}$ RWA and our capital ratios are calculated pursuant to OSFI's CAR Guideline, the leverage ratio is calculated pursuant to OSFI's Leverage Requirements Guideline, and the LCR and NSFR are calculated pursuant to OSFI's LAR Guideline, all of which are based on BCBS standards. For additional information, see the "Capital management" and "Liquidity risk" sections. $^{(7)}$ Average for the three months ended October 31 for each respective year. # Management's discussion and analysis ## Economic and market environment ### Year in review – 2025 Growth decelerated in Canada in 2025 as the economy was hit by elevated tariffs in some sectors and uncertainty over trade relations with the U.S. Although population growth was slowing, weak hiring resulted in an upward drift in the unemployment rate. Inflation remained close to the Bank of Canada's 2% target rate, allowing the central bank to further lower its policy rate during the year to support growth ahead. Lower interest rates supported a strong year for equities and capital market activity, a mid-year upturn in housing starts, and moderate growth in mortgage and personal loans. Growth in business loans decelerated due to the impact of economic uncertainty on investment spending. The U.S. economy has remained stronger than Canada's helped by a boom in capital spending for artificial intelligence (AI), but has been impacted by slowing population growth that has held back job creation. While core inflation has yet to come back to target, the central bank resumed cutting interest rates in the wake of a modest upturn in unemployment. ### Outlook for calendar year 2026 The ongoing global trade uncertainty presents a challenging environment for economic activity in Canada and abroad, with more stimulative monetary policy in most countries aimed at sustaining moderate global growth in 2026. The U.S. will see both court rulings and further negotiations over trade policy, the outcomes of which will impact both the U.S. economy and those of its trading partners, but tariffs are likely to remain well above pre-2025 levels. In Canada's case, we expect some progress to reduce some of the sectoral tariffs already imposed, but our outlook assumes that the Canada-U.S.-Mexico trade deal is extended and provides ongoing tariff-free access for other Canadian exports to the U.S. market. China continues to face higher tariffs than other countries. If the tariffs are maintained at current levels, we expect slower growth in China in 2026 even with increased support from fiscal stimulus. Europe is expected to see a modest improvement in growth in 2026, from the lagged impacts of 2025 interest rate cuts and increased defense spending in some countries. Oil prices could see a modest rebound in the coming year, while we expect to see continued firmness in prices for commodities tied to electrification and power production. After pausing earlier in 2025, the Bank of Canada cut interest rates further as unemployment climbed, and we expect its policy rate to hold at 2.25% through 2026 in order to support interest sensitive demand. Although Canadian tariffs and higher U.S. production costs will put some upward pressure on inflation, most of that will be offset by ongoing labour market slack that will constrain wage gains and consumer purchasing power for domestic goods and services. Fiscal policy could also mitigate an economic downturn through targeted relief for affected sectors and should support economic growth in 2026. Canadian GDP is expected to grow at 1.4% for 2026 as a whole, and with slow population growth, that will allow the unemployment rate to gradually ease and average at 6.7% for the year as a whole. A more severe global trade conflict, or more elevated U.S. tariffs on Canada, would represent a downside risk to this forecast, with the results dependent on the degree to which the trade shock would be offset by more substantial monetary and fiscal stimulus. The U.S. economy faces headwinds from a deceleration in population growth and the impact of elevated tariffs on consumer spending power and business costs. Strong capital spending on AI-related projects is expected to continue, but may not provide as large a year-over-year increase in growth as in 2025. Despite above-target inflation, the Federal Reserve has resumed cutting interest rates in response to slower hiring, and is expected to take the federal funds rate to under 3.5% in 2026. Real GDP growth is expected to be just under 2% for 2026 as a whole, with the unemployment rate stabilizing at 4.4%. Higher budget deficits could prevent a further drop in long-term rates, but fiscal stimulus and lighter regulatory policies will add some support for economic growth in 2026. Inflation is expected to accelerate as tariffs get passed through to consumers, with the CPI averaging 3.3% in 2026. For Canadian Personal Banking, mortgage growth is expected to continue at the current rate in 2026, as lower interest rates bring buyers back to the market tempered by reduced consumer confidence and policy measures designed to slow population growth. We expect to see a marginal improvement in activity as per capita discretionary spending accelerates in response to lower borrowing costs, offset by economic uncertainty resulting in a modest increase in demand for non-mortgage credit. De-escalating tariff concerns and interest rate relief should lead to loan growth in Canadian commercial banking and corporate banking in 2026. While loan growth in our U.S. commercial banking business had slowed due to the evolving trade policy uncertainties, we expect client investment activity will increase as the uncertainty lessens, which in turn will lead to further loan growth to the extent clients do not utilize their deposit holdings. Financial markets will benefit from interest rate reductions in both Canada and the U.S. Canadian and U.S. wealth management businesses have benefitted from strong equity market performance in both countries, and greater assets under management should be supportive for 2026. Corporate and investment banking is expected to continue to benefit from merger and acquisition activity, and corporate bond issuance is expected to pick up as capital spending improves with reduced uncertainties over tariffs in 2026. The economic outlook described above reflects numerous assumptions regarding the level and duration of tariffs between the U.S., Canada and other major trading partners, the impact that tariffs may have on economic growth and inflation in Canada and the U.S. and fiscal and monetary policies that may be enacted in response to tariffs, as well as the economic risks emanating from geopolitical events. As a result, actual experience may differ materially from expectations. The impact of trade policy uncertainty and geopolitical events on our risk environment, are discussed in the "Top and emerging risks" section. Changes in the level of economic uncertainty continue to impact key accounting estimates and assumptions, particularly the estimation of expected credit losses (ECL). See the "Accounting and control matters" section and Note 5 to our consolidated financial statements for further details. ## Significant events ### Sale of certain banking assets in the Caribbean On October 31, 2023, CIBC Caribbean Bank Limited (CIBC Caribbean) announced that it had entered into an agreement to sell its banking assets in Curaçao and Sint Maarten. The sale of banking assets in Curaçao was completed on May 24, 2024. The sale of banking assets in Sint Maarten was completed on February 7, 2025. The impact of these transactions was not material. 5 CIBC 2025 ANNUAL REPORT # Financial performance overview This section provides a review of our consolidated financial results for 2025. A review of our SBU results follows on pages 16 to 28. Refer to page 11 for a review of our financial performance for 2024. ## 2025 Financial results review Reported net income for the year was \$8,454 million, compared with \$7,154 million in 2024. Adjusted net income $^{(1)}$ for the year was \$8,487 million, compared with \$7,272 million in 2024. Reported diluted EPS for the year was \$8.57, compared with \$7.28 in 2024. Adjusted diluted EPS$^{(1)}$ for the year was \$8.61, compared with \$7.40 in 2024. Net income was affected by the following item of note: \$45 million (\$33 million after-tax) amortization and impairment of acquisition-related intangible assets (\$20 million after-tax in Canadian Personal and Business Banking, and \$13 million after-tax in U.S. Commercial Banking and Wealth Management). The above item of note increased non-interest expenses by \$45 million and decreased income taxes by \$12 million, and decreased net income by \$33 million. ## 2024 Net income was affected by the following items of note: \$103 million (\$77 million after-tax) charge related to the special assessment imposed by the Federal Deposit Insurance Corporation (FDIC) on U.S. depository institutions, which impacted CIBC Bank USA (U.S. Commercial Banking and Wealth Management); and \$56 million (\$41 million after-tax) amortization and impairment of acquisition-related intangible assets (\$19 million after-tax in Canadian Personal and Business Banking, and \$22 million after-tax in U.S. Commercial Banking and Wealth Management). The above items of note increased non-interest expenses by \$159 million and decreased income taxes by \$41 million. In aggregate, these items of note decreased net income by \$118 million. $^{(1)}$ Adjusted measures are non-GAAP measures. For additional information and a reconciliation of reported results to adjusted results, where applicable, see the "Non-GAAP measures" section. ## Net interest income and margin \$ millions, for the year ended October 31 | | 2025 | 2024 | |---|---|---| | Non-trading net interest income | \$ 16,893 | \$ 14,648 | | Trading net interest income $^{(1)}$ | (1,124) | (953) | | **Total net interest income** | **A** | **\$ 15,769** | **\$ 13,695** | | Average trading interest-earning assets | 140,073 | 109,676 | | Average non-trading interest-earning assets | 875,571 | 819,928 | | **Total average interest-earning assets** | **B** | **1,015,644** | **929,604** | | Net interest margin on average interest-earning assets | A/B | 1.55% | 1.47% | | Net interest margin on average interest-earning assets (excluding trading) $^{(1)}$ | | 1.93% | 1.79% | $^{(1)}$ See the "Glossary - Trading activities and trading net interest income" and "Glossary - Net interest margin on average interest-earning assets (excluding trading)" sections for additional information. Net interest income was up \$2,074 million or 15% from 2024, primarily due to volume growth across all of our businesses, including from the conversion of bankers' acceptances to Canadian Overnight Repo Rate Average (CORRA) resulting from Canadian Dollar Offered Rate (CDOR) cessation in 2024, higher net interest margin in our non-trading businesses, and the impact of foreign exchange translation, partially offset by lower treasury revenue and lower trading net interest income. Net interest margin on average interest-earning assets was up 8 basis points from 2024, primarily due to higher deposit and loan margins, partially offset by lower trading net interest income. Net interest margin on average interest-earning assets (excluding trading) was up 14 basis points from 2024, primarily due to higher deposit and loan margins. Additional information on net interest income and margin is provided in the "Supplementary annual financial information" section and in the "Strategic business units overview" section. 6 CIBC 2025 ANNUAL REPORT ## Non-interest income \$ millions, for the year ended October 31 | | 2025 | 2024 | |---|---|---| | Underwriting and advisory fees | \$ 915 | \$ 707 | | Deposit and payment fees | 996 | 958 | | Credit fees | 1,015 | 1,218 | | Card fees | 402 | 414 | | Investment management and custodial fees $^{(1)(2)}$ | 2,241 | 1,980 | | Mutual fund fees $^{(2)}$ | 2,019 | 1,796 | | Income from insurance activities, net | 317 | 356 | | Commissions on securities transactions | 554 | 431 | | Gains (losses) from financial instruments measured/designated at fair value through profit or loss (FVTPL), net $^{(3)}$ | 4,022 | 3,226 | | Gains (losses) from debt securities measured at fair value through other comprehensive income (FVOCI) and amortized cost, net | (14) | 43 | | Foreign exchange other than trading | 369 | 386 | | Income from equity-accounted associates and joint ventures $^{(2)}$ | 117 | 79 | | Other | 411 | 317 | | **Total non-interest income** | **\$ 13,364** | **\$ 11,911** | $^{(1)}$ Custodial fees directly recognized by CIBC are included in Investment management and custodial fees. Our proportionate share of the custodial fees from the joint ventures which CIBC has with The Bank of New York Mellon are included within Income from equity-accounted associates and joint ventures. $^{(2)}$ Investment management fees and mutual fund fees are driven by various factors, including the amount of AUM. Investment management fees in our asset management and private wealth management businesses are generally driven by the amount of AUM, while investment management fees in our retail brokerage business are driven by a combination of the amount of AUA and, to a lesser extent, other factors not directly related to the amount of AUA (e.g., flat fees on a per account basis). $^{(3)}$ Includes \$174 million of gains (2024: \$82 million of gains) relating to non-trading financial instruments measured/designated at FVTPL. Non-interest income was up \$1,453 million or 12% from 2024. Underwriting and advisory fees were up \$208 million or 29%, primarily due to higher advisory and debt issuance revenue in Capital Markets. Credit fees were down \$203 million or 17%, primarily due to the conversion of bankers' acceptances to CORRA loans in 2024, partially offset by an increase in volume growth in our corporate and commercial banking businesses. Investment management and custodial fees were up \$261 million or 13%, primarily due to higher average AUA and AUM balances attributable to market appreciation in our wealth management businesses and the impact of foreign currency translation. Mutual fund fees were up \$223 million or 12%, primarily due to higher average AUM balances in our wealth management businesses. Commissions on securities transactions were up \$123 million or 29%, primarily due to higher trading volume in our retail brokerage business. Gains (losses) from financial instruments measured/designated at FVTPL, net were up \$796 million or 25%, primarily due to higher trading income, including from the impact of decreases in interest rates on derivatives that are economically hedging interest on trading securities included in net interest income. Gains (losses) from debt securities measured at FVOCI and amortized cost, net were down \$57 million or 133%, primarily due to impairment of debt securities measured at amortized cost and lower net realized gains from dispositions of FVOCI debt securities. Income from equity-accounted associates and joint ventures was up \$38 million or 48%, primarily due to higher revenue from our strategic investments. ## Trading revenue$^{(1)(2)}$ \$ millions, for the year ended October 31 | | 2025 | 2024 | |---|---|---| | Net interest income | \$ (1,124) | \$ (937) | | Non-interest income $^{(2)}$ | 3,848 | 3,144 | | **Total trading revenue** | **\$ 2,724** | **\$ 2,207** | | Interest rates | \$ 586 | \$ 518 | | Foreign exchange | 1,027 | 969 | | Equities | 844 | 540 | | Commodities | 264 | 179 | | Other | 3 | 1 | | **Total trading revenue** | **\$ 2,724** | **\$ 2,207** | $^{(1)}$ Trading activities and related risk management strategies can periodically shift trading income between net interest income and non-interest income. Therefore, we view total trading income as the most appropriate measure of trading performance. For additional information, see the "Glossary - Trading activities and trading net interest income" section. $^{(2)}$ Reported as part of the Gains (losses) from financial instruments measured/designated at FVTPL in the consolidated statement of income, which consist of a gain of \$3,848 million (2024: \$3,144 million) related to trading financial instruments measured/designated at FVTPL and a gain of \$174 million (2024: \$82 million) relating to non-trading financial instruments measured/designated at FVTPL. Trading revenue was up \$517 million or 23% from 2024, primarily due to higher equities, commodities, interest rates and foreign exchange trading revenue. Trading revenue comprises net interest income and non-interest income. Net interest income arises from interest and dividends relating to financial assets and liabilities associated with trading activities, other than derivatives, net of interest expense and interest income associated with funding these assets and liabilities. Non-interest income includes realized and unrealized gains and losses on securities mandatorily measured at FVTPL and income relating to changes in fair value of derivative financial instruments. Trading revenue excludes underwriting fees and commissions on securities transactions, which are shown separately in the consolidated statement of income. Trading activities and related risk management strategies can periodically shift income between net interest income and non-interest income. Therefore, we view total trading revenue as the most appropriate measure of trading performance. ## Provision for credit losses \$ millions, for the year ended October 31 | | 2025 | 2024 | |---|---|---| | **Provision for credit losses - impaired** | | | | Canadian Personal and Business Banking $^{(1)}$ | \$ 1,365 | \$ 1,169 | | Canadian Commercial Banking and Wealth Management $^{(1)}$ | 112 | 75 | | U.S. Commercial Banking and Wealth Management $^{(1)}$ | 268 | 449 | | Capital Markets $^{(1)}$ | 117 | 55 | | Corporate and Other | 25 | 12 | | **Total provision for credit losses - impaired** | **1,887** | **1,760** | | **Provision for (reversal of) credit losses – performing** | | | | Canadian Personal and Business Banking $^{(1)}$ | 399 | 64 | | Canadian Commercial Banking and Wealth Management $^{(1)}$ | 54 | 48 | | U.S. Commercial Banking and Wealth Management $^{(1)}$ | (93) | 111 | | Capital Markets $^{(1)}$ | 91 | 29 | | Corporate and Other | 4 | (11) | | **Total provision for (reversal of) credit losses – performing** | **455** | **241** | | **Total provision for credit losses** | **\$ 2,342** | **\$ 2,001** | $^{(1)}$ Certain prior year information has been restated. See the "External reporting changes" section for additional details. Provision for credit losses was up \$341 million or 17% from 2024. Provision for credit losses on performing loans was up primarily due to an unfavourable change in our economic outlook and model parameter updates, partially offset by favourable credit migration, as well as higher allowance releases for credit migration from the performing to the impaired portfolio in the U.S. in the current year. Provision for credit losses on impaired loans was up due to higher provisions in all SBUs, except U.S. Commercial Banking and Wealth Management. For further details regarding provision for credit losses in our SBU's, refer to the "Strategic business units overview" section. ## Non-interest expenses \$ millions, for the year ended October 31 | | 2025 | 2024 | |---|---|---| | Employee compensation and benefits | | | | Salaries $^{(1)}$ | \$ 4,642 | \$ 4,267 | | Performance-based compensation | 3,501 | 2,992 | | Benefits | 1,123 | 1,002 | | Occupancy costs | 9,266 | 8,261 | | Computer, software and office equipment | 847 | 830 | | Communications | 2,946 | 2,719 | | Advertising and business development | 395 | 362 | | Professional fees | 398 | 344 | | Business and capital taxes | 284 | 257 | | Other | 124 | 128 | | Total non-interest expenses | 1,592 | 1,538 | | **Total non-interest expenses** | **\$ 15,852** | **\$ 14,439** | $^{(1)}$ Includes termination benefits. Non-interest expenses were up \$1,413 million or 10% from 2024. Employee compensation and benefits were up \$1,005 million or 12%, primarily due to higher performance-based and other employee-related compensation, including higher employee termination costs. Computer, software and office equipment were up \$227 million or 8%, primarily due to higher spending on technology and other strategic initiatives, and higher software maintenance. Advertising and business development were up \$54 million or 16%, primarily due to higher marketing, business travel and sponsorship expenses. 8 CIBC 2025 ANNUAL REPORT ## Taxes | \$ millions, for the year ended October 31 | 2025 | 2024 | |---|---|---| | Income taxes | \$ 2,485 | \$ 2,012 | | Goods and Services Tax (GST), Harmonized Sales Tax (HST) and sales taxes | 550 | 502 | | Payroll taxes | 467 | 406 | | Capital taxes | 79 | 82 | | Property and business taxes | 78 | 69 | | Total indirect taxes $^{(1)}$ | 1,174 | 1,059 | | **Total taxes** | **\$ 3,659** | **\$ 3,071** | | Reported effective tax rate | 22.7% | 21.9% | | Total taxes as a percentage of net income before deduction of total taxes | 30.2% | 30.0% | $^{(1)}$ Certain amounts are based on a paid or payable basis and do not factor in capitalization and subsequent amortization. Total income and indirect taxes were up \$588 million from 2024. Income tax expense was \$2,485 million, up \$473 million from 2024, due to higher income. Indirect taxes were up \$115 million from 2024, due to increases in both sales taxes and payroll taxes. Sales taxes increased by \$48 million from 2024, primarily due to Canadian sales taxes that resulted from higher spending on technology and other strategic initiatives. Payroll taxes were up \$61 million from 2024, primarily due to increases in unemployment, health insurance and statutory pension contributions. Indirect taxes are included in non-interest expenses. ### Global Minimum Tax On June 20, 2024, Canada enacted the Global Minimum Tax Act (GMTA) to adopt the Organisation for Economic Co-operation and Development's Pillar Two, which implements a 15% global minimum corporate tax (GMT) on certain multinational enterprises. These rules applied to CIBC as of November 1, 2024. The impact of GMT on CIBC's consolidated tax rate is within a 1% range for the year ended October 31, 2025. ## Foreign exchange The estimated impact of U.S. dollar translation on key lines of our consolidated statement of income, as a result of changes in average exchange rates, is as follows: | \$ millions, for the year ended October 31 | 2025 vs. 2024 | 2024 vs. 2023 | |---|---|---| | Estimated increase in: | | | | Total revenue | \$ 212 | \$ 44 | | Provision for credit losses | 11 | 5 | | Non-interest expenses | 102 | 23 | | Income taxes | 25 | 4 | | Net income | 74 | 12 | | Impact on EPS: | | | | Basic | \$ 0.08 | \$ 0.01 | | Diluted | 0.08 | 0.01 | | Average USD appreciation relative to CAD | 3.2% | 0.8% | ## Fourth quarter review \$ millions, except per share amounts, for the three months ended | | 2025 | | | | 2024 | | | | |---|---|---|---|---|---|---|---|---| | **Oct. 31** | **Jul. 31** | **Apr. 30** | **Jan. 31** | **Oct. 31** | **Jul. 31** | **Apr. 30** | **Jan. 31** | | **Revenue** | | | | | | | | | | Canadian Personal and Business Banking $^{(1)}$ | \$ 3,188 | \$ 3,061 | \$ 2,859 | \$ 2,923 | \$ 2,842 | \$ 2,775 | \$ 2,646 | \$ 2,679 | | Canadian Commercial Banking and Wealth Management $^{(1)}$ | 1,836 | 1,723 | 1,640 | 1,703 | 1,602 | 1,523 | 1,456 | 1,437 | | U.S. Commercial Banking and Wealth Management $^{(1)}$ | 810 | 790 | 769 | 847 | 733 | 731 | 669 | 687 | | Capital Markets $^{(1)(2)}$ | 1,523 | 1,506 | 1,545 | 1,574 | 1,155 | 1,092 | 1,243 | 1,310 | | Corporate and Other $^{(2)}$ | 219 | 174 | 209 | 234 | 285 | 483 | 150 | 108 | | **Total revenue** | **\$ 7,576** | **\$ 7,254** | **\$ 7,022** | **\$ 7,281** | **\$ 6,617** | **\$ 6,604** | **\$ 6,164** | **\$ 6,221** | | Net interest income | 4,132 | 4,048 | 3,788 | 3,801 | 3,633 | 3,532 | 3,281 | 3,249 | | Non-interest income | 3,444 | 3,206 | 3,234 | 3,480 | 2,984 | 3,072 | 2,883 | 2,972 | | **Total revenue** | **7,576** | **7,254** | **7,022** | **7,281** | **6,617** | **6,604** | **6,164** | **6,221** | | Provision for credit losses | 605 | 559 | 605 | 573 | 419 | 483 | 514 | 585 | | Non-interest expenses | 4,179 | 3,976 | 3,819 | 3,878 | 3,791 | 3,682 | 3,501 | 3,465 | | **Income before income taxes** | **2,792** | **2,719** | **2,598** | **2,830** | **2,407** | **2,439** | **2,149** | **2,171** | | Income taxes | 612 | 623 | 591 | 659 | 525 | 644 | 400 | 443 | | **Net income** | **\$ 2,180** | **\$ 2,096** | **\$ 2,007** | **\$ 2,171** | **\$ 1,882** | **\$ 1,795** | **\$ 1,749** | **\$ 1,728** | | **Net income attributable to:** | | | | | | | | | | Non-controlling interests | \$ 6 | \$ 2 | \$ 8 | \$ 9 | \$ 8 | \$ 9 | \$ 10 | \$ 12 | | Equity shareholders | 2,174 | 2,094 | 1,998 | 2,163 | 1,874 | 1,786 | 1,739 | 1,716 | | **EPS - basic** | **\$ 2.21** | **\$ 2.20** | **\$ 2.20** | **\$ 2.19** | **\$ 2.16** | **\$ 2.15** | **\$ 2.05** | **\$ 2.04** | | **diluted** | **\$ 2.20** | **\$ 2.19** | **\$ 2.18** | **\$ 2.17** | **\$ 1.91** | **\$ 1.90** | **\$ 1.83** | **\$ 1.82** | $^{(1)}$ Certain prior year information has been restated. See "External reporting changes" for additional details. $^{(2)}$ Commencing in the third quarter of 2024, tax equivalent basis (TEB) reporting is no longer applicable to certain dividends received on or after January 1, 2024. In the third quarter of 2024, the enactment of the denial of the dividends received deduction resulted in a TEB reversal for dividends received on or after January 1, 2024 that were reflected in the first and second quarters of 2024 as an item of note. Prior to the third quarter of 2024, Capital Markets revenue and income taxes were reported on a TEB with an equivalent offset in the revenue and income taxes of Corporate and Other. ## Quarterly trend analysis Our quarterly results are modestly affected by seasonal factors. The second quarter has fewer days as compared with the other quarters, generally leading to lower earnings. The summer months (July - third quarter and August - fourth quarter) typically experience lower levels of market activity, which affects our brokerage, investment management, and capital markets activities. ### Revenue Revenue in our lending and deposit-taking businesses is generally driven by volume growth, fees related to client transaction activity and the interest rate environment. Our wealth management businesses are driven by net sales activity impacting AUA and AUM, the level of client investment activity and market conditions. Capital markets revenue is also influenced, to a large extent, by market conditions affecting client trading, underwriting and advisory activity. Canadian Personal and Business Banking has benefitted from loan and deposit growth through the periods presented above, driven by organic client growth, along with building and deepening relationships across our client base. Canadian Commercial Banking and Wealth Management revenue has benefitted from commercial banking volume growth and positive investor sentiment in wealth management. In commercial banking, revenue growth has been driven by client demand that has rebounded since the later part of 2024. In wealth management, AUA and AUM growth and associated fee income have been helped by market appreciation and strong sales activity across our distribution channels. U.S. Commercial Banking and Wealth Management revenue has continued to benefit from growth in our core businesses, supported by our ongoing strategy of deepening client relationships. Loan volumes had been growing since the second quarter of 2024 until the most recent quarter of 2025, which experienced high payoffs. Revolver utilization rates remained low. Deposit balances have increased from the first quarter of 2024, except for the declines in the second and third quarters of 2025 due to seasonal outflows and draw down of short-term placements. In our wealth management segment, AUM has shown growth, contributing to higher fee income. This positive trend has been supported by market appreciation, despite some volatility experienced in the first half of 2025. Capital Markets had consistently higher trading revenue in 2025 compared with 2024, driven by robust market conditions and strong client activity. The third quarter of 2024 included a TEB reversal related to the denial of the dividends received deduction for Canadian banks, shown as an item of note. Corporate and Other included the impact of higher net interest margins in International banking from rising interest rates until the third quarter of 2024. The third quarter of 2024 included higher treasury revenue and a TEB offset reversal related to the denial of the dividends received deduction for Canadian banks, shown as an item of note. The third quarter of 2025 included investment losses and impairment on debt securities in International banking. ### Provision for credit losses Provision for credit losses is dependent upon the credit cycle, on the credit performance of the loan portfolios, and changes in our economic outlook. We have been operating in an uncertain macroeconomic environment in which there is considerable judgment involved in the estimation of expected credit losses. Uncertainty over tariffs imposed or proposed by the U.S. government impacted our provision for credit losses for performing loans in fiscal 2025. An unfavourable change in our outlook for the U.S. real estate and construction sector contributed to an increase in provision for credit losses on performing loans in the first quarter of 2024. Unfavourable credit migration impacted our provision for credit losses in the first, second and third quarters of 2024, and the fourth quarter of 2025. In Canadian Personal and Business Banking, provisions on impaired loans trended higher consistent with expectations in fiscal 2025, due to the unfavourable macroeconomic environment for the retail portfolios. 10 CIBC 2025 ANNUAL REPORT In Canadian Commercial Banking and Wealth Management, the third quarter of 2024, and the second and fourth quarters of 2025 included higher provisions on impaired loans. In U.S. Commercial Banking and Wealth Management, the provisions on impaired loans in the first quarter of 2024 were mainly attributable to the real estate and construction sector. This sector also contributed to impairment losses in the second and fourth quarters of 2024 and the first, third and fourth quarters of 2025. In Capital Markets, the third and fourth quarters of 2024, and the third and fourth quarters of 2025 included higher provisions on impaired loans. In Corporate and Other, provisions for impaired loans in International banking have remained relatively stable. ### Non-interest expenses Non-interest expenses have increased throughout 2024 and 2025 primarily due to employee compensation expenses and spending on strategic and other initiatives. The first and second quarters of 2024 included a charge related to the special assessment imposed by the FDIC, shown as an item of note. The first quarter of 2025 included a legal provision. ### Income taxes Income taxes vary with changes in taxable income in the jurisdictions in which the income is earned. The third quarter of 2024 included an income tax charge related to the denial of the dividends received deduction for Canadian banks, which was shown as an item of note. ## Review of 2024 financial performance | \$ millions, for the year ended October 31 | Canadian Personal and Business Banking | Canadian Commercial Banking and Wealth Management | U.S. Commercial Banking and Wealth Management | Capital Markets $^{(2)}$ | Corporate and Other $^{(2)}$ | CIBC Total | |---|---|---|---|---|---|---| | **2024 $^{(1)}$** | | | | | | | | Net interest income | \$ 8,592 | \$ 2,232 | \$ 1,906 | \$ 303 | \$ 662 | \$ 13,695 | | Non-interest income | 2,350 | 3,786 | 914 | 4,497 | 364 | 11,911 | | **Total revenue** | **10,942** | **6,018** | **2,820** | **4,800** | **1,026** | **25,606** | | Provision for credit losses | 1,233 | 123 | 560 | 84 | 1 | 2,001 | | Non-interest expenses | 5,706 | 3,066 | 1,718 | 2,479 | 1,470 | 14,439 | | Income (loss) before income taxes | 4,003 | 2,829 | 542 | 2,237 | (445) | 9,166 | | Income taxes | 1,098 | 766 | 42 | 608 | (502) | 2,012 | | **Net income** | **\$ 2,905** | **\$ 2,063** | **\$ 500** | **\$ 1,629** | **\$ 57** | **\$ 7,154** | | Net income attributable to: | | | | | | | | Non-controlling interests | \$ - | \$ - | \$ - | \$ - | \$ 39 | \$ 39 | | Equity shareholders | 2,905 | 2,063 | 500 | 1,629 | 18 | 7,115 | | **2023 $^{(1)}$** | | | | | | | | Net interest income | \$ 7,941 | \$ 1,969 | \$ 1,889 | \$ 1,091 | \$ (65) | \$ 12,825 | | Non-interest income | 2,183 | 3,682 | 824 | 3,420 | 398 | 10,507 | | **Total revenue** | **10,124** | **5,651** | **2,713** | **4,511** | **333** | **23,332** | | Provision for (reversal of) credit losses | 1,015 | 143 | 850 | (10) | 12 | 2,010 | | Non-interest expenses | 5,525 | 2,809 | 1,483 | 2,235 | 2,297 | 14,349 | | Income (loss) before income taxes | 3,584 | 2,699 | 380 | 2,266 | (1,976) | 6,973 | | Income taxes | 979 | 722 | (2) | 643 | (408) | 1,934 | | **Net income (loss)** | **\$ 2,605** | **\$ 1,977** | **\$ 382** | **\$ 1,643** | **\$ (1,568)** | **\$ 5,039** | | Net income (loss) attributable to: | | | | | | | | Non-controlling interests | \$ - | \$ - | \$ - | \$ - | \$ 38 | \$ 38 | | Equity shareholders | 2,605 | 1,977 | 382 | 1,643 | (1,606) | 5,001 | $^{(1)}$ Certain prior year information has been restated. See "External reporting changes" for additional details. $^{(2)}$ Capital Markets net interest income and income taxes include TEB adjustments of \$16 million (2023: \$254 million) with an equivalent offset in Corporate and Other. TEB adjustment and related offset is no longer applied since the third quarter of 2024 upon the enactment of Bill C-59 in June 2024, which eliminated the dividend received deduction for Canadian banks. Overview Net income for 2024 was \$7,154 million, compared with \$5,039 million in 2023. The increase in net income of \$2,115 million was due to higher revenue, and a lower provision for credit losses, partially offset by higher non-interest expenses. Consolidated CIBC Net interest income Net interest income was up \$870 million or 7% from 2023, primarily due to volume growth across most of our businesses, higher treasury revenue, higher net interest margin in Canadian Personal and Business Banking and the conversion of bankers' acceptances to CORRA loans, partially offset by lower trading net interest income. Non-interest income Non-interest income was up \$1,404 million or 13% from 2023, primarily due to higher trading income, including from the impact of increases in interest rates on derivatives that are economically hedging interest on trading securities included in net interest income, higher fee income in our wealth management businesses from higher average AUA and AUM balances, higher debt issuance revenue, and higher trading volume in our retail brokerage business, partially offset by lower credit fees primarily due to the conversion of bankers' acceptances to CORRA loans. 11 CIBC 2025 ANNUAL REPORT Provision for credit losses Provision for credit losses was down \$9 million from 2023. Provision for credit losses on performing loans was down due to a less unfavourable change in our economic outlook and less unfavourable credit migration in 2024, partially offset by an increase resulting from model parameter updates. Provision for credit losses on impaired loans was up due to higher write-offs in Canadian Personal and Business Banking, and higher provisions in Capital Markets, partially offset by lower provisions in all other SBUs. Non-interest expenses Non-interest expenses were up \$90 million or 1% from 2023, primarily due to higher performance-based and employee-related compensation, higher spending on strategic and regulatory initiatives, and software impairment charges, and higher business travel, sponsorship and marketing expenses, partially offset by a decrease in legal provisions. Income taxes Income tax expense was up \$78 million or 4% from 2023, primarily due to higher income and the enactment of the Federal tax measure that denies the dividends received deduction for Canadian banks. The first quarter of 2023 included an income tax charge to recognize the Canada Recovery Dividend tax and the retroactive impact of the 1.5% tax rate increase. ### Revenue by segment Canadian Personal and Business Banking Revenue was up \$818 million or 8% from 2023. Net interest income was up \$651 million or 8% from 2023, primarily due to higher net interest margin and volume growth. Non-interest income was up \$167 million or 8% from 2023, primarily due to higher fees. The prior year included a commodity tax charge related to the retroactive impact of the 2023 Canadian Federal budget. Canadian Commercial Banking and Wealth Management Revenue was up \$367 million or 6% from 2023. Commercial banking revenue was down \$36 million or 1%, primarily due to lower deposit and loan margins, partially offset by volume growth. Wealth management revenue was up \$403 million or 13%, primarily due to higher fee-based revenue from higher average AUA and AUM balances and higher commission revenue from increased client activity. U.S. Commercial Banking and Wealth Management Revenue was up \$107 million or 4% from 2023. Commercial banking revenue was up \$164 million or 9%, primarily due to higher loan margins, deposit volumes and fees, partially offset by lower deposit margins. Wealth management revenue was down \$57 million or 6%, primarily due to lower deposit margins in our private banking business, partially offset by higher deposit volumes and higher asset management fees from higher average AUM balances. Capital Markets Revenue was up \$289 million or 6% from 2023. Global markets revenue was up \$160 million or 6%, primarily due to higher financing revenue, partially offset by lower equity derivatives, lower TEB adjustments from the discontinuation of the dividends received deduction for dividends received on and after January 1, 2024, and lower fixed income and commodities trading revenue. Corporate and investment banking revenue was up \$129 million or 8%, primarily due to higher debt underwriting activity, higher advisory revenue, and lower losses from our investment portfolios, partially offset by lower corporate banking revenue. Corporate and Other Revenue was up \$693 million or 208% from 2023. International banking revenue was up \$24 million, primarily due to higher net interest margin and the impact of foreign exchange translation, partially offset by higher gains on the sale of certain banking assets in the Caribbean in 2023. Other revenue was up \$669 million, primarily due to higher treasury revenue resulting from lower funding costs borne by Treasury, and a lower TEB offset related to the enactment of a Federal tax measure that denies the dividends received deduction for Canadian banks. 12 CIBC 2025 ANNUAL REPORT ## Non-GAAP measures We use a number of financial measures to assess the performance of our business lines as described below. Some measures are calculated in accordance with GAAP (IFRS), while other measures do not have a standardized meaning under GAAP, and accordingly, these measures may not be comparable to similar measures used by other companies. Investors may find these non-GAAP measures, which include non-GAAP financial measures and non-GAAP ratios as defined in National Instrument 52-112 "Non-GAAP and Other Financial Measures Disclosure", useful in understanding how management views underlying business performance. ### Adjusted measures Management assesses results on a reported and adjusted basis and considers both as useful measures of performance. Adjusted measures, which include adjusted total revenue, adjusted provision for credit losses, adjusted non-interest expenses, adjusted income before income taxes, adjusted income taxes and adjusted net income, in addition to the adjusted measures noted below, remove items of note from reported results to calculate our adjusted results. Items of note include the amortization of intangible assets, and certain items of significance that arise from time to time which management believes are not reflective of underlying business performance. We believe that adjusted measures provide the reader with a better understanding of how management assesses underlying business performance and facilitates a more informed analysis of trends. While we believe that adjusted measures may facilitate comparisons between our results and those of some of our Canadian peer banks, which make similar adjustments in their public disclosure, it should be noted that there is no standardized meaning for adjusted measures under GAAP. Prior to the third quarter of 2024, we also adjusted our SBU results to gross up tax-exempt revenue on certain securities to a TEB, being the amount of fully taxable revenue, which, were it to have incurred tax at the statutory income tax rate, would yield the same after-tax revenue. In the third quarter of 2024, with the enactment of the denial of the dividends received deduction for Canadian banks in respect of dividends received on Canadian shares (applicable as of January 1, 2024), TEB is no longer being applied to these dividends. In addition, TEB recognized in the first and second quarters of 2024 on impacted dividends was reversed in the third quarter of 2024. See the "Strategic business units overview" section and Note 29 to our consolidated financial statements for further details. ### Adjusted diluted EPS We adjust our reported diluted EPS to remove the impact of items of note, net of income taxes, to calculate the adjusted EPS. ### Adjusted efficiency ratio We adjust our reported revenue and non-interest expenses to remove the impact of items of note. ### Adjusted operating leverage We adjust our reported revenue and non-interest expenses to remove the impact of items of note. ### Adjusted dividend payout ratio We adjust our reported net income attributable to common shareholders to remove the impact of items of note, net of income taxes, to calculate the adjusted dividend payout ratio. ### Adjusted return on common shareholders' equity We adjust our reported net income attributable to common shareholders to remove the impact of items of note, net of income taxes, to calculate the adjusted return on common shareholders' equity. ### Adjusted effective tax rate We adjust our reported income before income taxes and reported income taxes to remove the impact of items of note, to calculate the adjusted effective tax rate. ### Pre-provision, pre-tax earnings Pre-provision, pre-tax earnings is calculated as revenue net of non-interest expenses, and provides the reader with an assessment of our ability to generate earnings to cover credit losses through the credit cycle, as well as an additional basis for comparing underlying business performance between periods by excluding the impact of provision for credit losses, which involves the application of judgments and estimates related to matters that are uncertain and can vary significantly between periods. We adjust our pre-provision, pre-tax earnings to remove the impact of items of note to calculate the adjusted pre-provision, pre-tax earnings. As discussed above, we believe that adjusted measures provide the reader with a better understanding of how management assesses underlying business performance and facilitates a more informed analysis of trends. ### Allocated common equity Common equity is allocated to the SBUs based on the estimated amount of regulatory capital required to support their businesses (as determined for the consolidated bank pursuant to OSFI's regulatory capital requirements and internal targets). Unallocated common equity is reported in Corporate and Other. Allocating capital on this basis provides a consistent framework to evaluate the returns of each SBU commensurate with the risk assumed. For additional information, see the "Risks arising from business activities" section. ### Segmented return on equity We use return on equity on a segmented basis as one of the measures for performance evaluation and resource allocation decisions. While return on equity for total CIBC provides a measure of return on common equity, return on equity on a segmented basis provides a similar metric based on allocated common equity to our SBUs. As a result, segmented return on equity is a non-GAAP ratio. Segmented return on equity is calculated as net income attributable to common shareholders for each SBU expressed as a percentage of average allocated common equity, which is the average of monthly allocated common equity during the period. 13 CIBC 2025 ANNUAL REPORT The following table provides a reconciliation of GAAP (reported) results to non-GAAP (adjusted) results on a segmented basis. | \$ millions, for the year ended October 31, 2025 | Canadian Personal and Business Banking | Canadian Commercial Banking and Wealth Management | U.S. Commercial Banking and Wealth Management | Capital Markets | Corporate and Other | CIBC Total | U.S. Commercial Banking and Wealth Management (US\$ millions) | |---|---|---|---|---|---|---|---| | **Operating results – reported** | | | | | | | | | Total revenue | \$ 12,031 | \$ 6,902 | \$ 3,216 | \$ 6,148 | \$ 836 | \$ 29,133 | \$ 2,293 | | Provision for credit losses | 1,764 | 166 | 175 | 208 | 29 | 2,342 | 124 | | Non-interest expenses | 6,067 | 3,522 | 1,861 | 2,855 | 1,547 | 15,852 | 1,326 | | Income (loss) before income taxes | 4,200 | 3,214 | 1,180 | 3,085 | (740) | 10,939 | 843 | | Income taxes | 1,093 | 873 | 222 | 812 | (515) | 2,485 | 158 | | Net income (loss) | 3,107 | 2,341 | 958 | 2,273 | (225) | 8,454 | 685 | | Net income attributable to non-controlling interests | 25 | | | | | 25 | | | Preferred shareholders and other equity instrument holders | 364 | | | | | 364 | | | Common shareholders | 3,107 | 2,341 | 958 | 2,273 | (614) | 8,065 | 685 | | Net income (loss) attributable to equity shareholders | 3,107 | 2,341 | 958 | 2,273 | (250) | 8,429 | 685 | | Diluted EPS (\$) | \$ 8.57 | | | | | | | | **Impact of items of note $^{(1)}$** | | | | | | | | | **Non-interest expenses** | | | | | | | | | Amortization and impairment of acquisition-related intangible assets | \$ (27) | \$ - | \$ (18) | \$ - | \$ - | \$ (45) | \$ (13) | | Impact of items of note on non-interest expenses | (27) | - | (18) | - | - | (45) | (13) | | **Total pre-tax impact of items of note on net income** | **27** | **-** | **18** | **-** | **-** | **45** | **13** | | **Income taxes** | | | | | | | | | Amortization and impairment of acquisition-related intangible assets | 7 | 5 | | | | 12 | 4 | | Impact of items of note on income taxes | 7 | 5 | | | | 12 | 4 | | **Total after-tax impact of items of note on net income** | **\$ 20** | **\$ -** | **\$ 13** | **\$ -** | **\$ -** | **\$ 33** | **\$ 9** | | **Impact of items of note on diluted EPS (\$)$^{(2)}$** | | | | | | **\$ 0.04** | | | **Operating results – adjusted $^{(3)}$** | | | | | | | | | Total revenue - adjusted | \$ 12,031 | \$ 6,902 | \$ 3,216 | \$ 6,148 | \$ 836 | \$ 29,133 | \$ 2,293 | | Provision for credit losses - adjusted | 1,764 | 166 | 175 | 208 | 29 | 2,342 | 124 | | Non-interest expenses - adjusted | 6,040 | 3,522 | 1,843 | 2,855 | 1,547 | 15,807 | 1,313 | | Income (loss) before income taxes - adjusted | 4,227 | 3,214 | 1,198 | 3,085 | (740) | 10,984 | 856 | | Income taxes - adjusted | 1,100 | 873 | 227 | 812 | (515) | 2,497 | 162 | | Net income (loss) – adjusted | 3,127 | 2,341 | 971 | 2,273 | (225) | 8,487 | 694 | | Net income attributable to non-controlling interests - adjusted | 25 | | | | | 25 | | | Preferred shareholders and other equity instrument holders - adjusted | 364 | | | | | 364 | | | Common shareholders - adjusted | 3,127 | 2,341 | 971 | 2,273 | (614) | 8,098 | 694 | | Net income (loss) attributable to equity shareholders - adjusted | 3,127 | 2,341 | 971 | 2,273 | (250) | 8,462 | 694 | | **Adjusted diluted EPS (\$)** | **\$ 8.61** | | | | | | | $^{(1)}$ Items of note are removed from reported results to calculate adjusted results. $^{(2)}$ Includes the impact of rounding differences between diluted EPS and adjusted diluted EPS. $^{(3)}$ Adjusted to exclude the impact of items of note. Adjusted measures are non-GAAP measures. $^{(4)}$ Certain prior year information has been restated. See "External reporting changes" for additional details. The following table provides a reconciliation of GAAP (reported) net income to non-GAAP (adjusted) pre-provision, pre-tax earnings on a segmented basis. | \$ millions, for the year ended October 31 | Canadian Personal and Business Banking | Canadian Commercial Banking and Wealth Management | U.S. Commercial Banking and Wealth Management | Capital Markets | Corporate and Other | CIBC Total | U.S. Commercial Banking and Wealth Management (US\$ millions) | |---|---|---|---|---|---|---|---| | **2025** | | | | | | | | | Net income (loss) | \$ 3,107 | \$ 2,341 | \$ 958 | \$ 2,273 | \$ (225) | \$ 8,454 | \$ 685 | | Add: provision for credit losses | 1,764 | 166 | 175 | 208 | 29 | 2,342 | 124 | | Add: income taxes | 1,093 | 873 | 222 | 812 | (515) | 2,485 | 158 | | **Pre-provision (reversal), pre-tax earnings (losses) $^{(1)}$** | **5,964** | **3,380** | **1,355** | **3,293** | **(711)** | **13,281** | **967** | | Pre-tax impact of items of note $^{(2)}$ | 27 | | 18 | | | 45 | 13 | | **Adjusted pre-provision (reversal), pre-tax earnings (losses) $^{(3)}$** | **\$ 5,991** | **\$ 3,380** | **\$ 1,373** | **\$ 3,293** | **\$ (711)** | **\$ 13,326** | **\$ 980** | | **2024 $^{(4)}$ Net income** | **\$ 2,905** | **\$ 2,063** | **\$ 500** | **\$ 1,629** | **\$ 57** | **\$ 7,154** | **\$ 368** | | Add: provision for credit losses | 1,233 | 123 | 560 | 84 | 1 | 2,001 | 412 | | Add: income taxes | 1,098 | 766 | 42 | 608 | (502) | 2,012 | 31 | | **Pre-provision (reversal), pre-tax earnings (losses) $^{(1)}$** | **5,236** | **2,952** | **1,102** | **2,321** | **(444)** | **11,167** | **811** | | Pre-tax impact of items of note $^{(2)}$ | 26 | | 133 | | | 159 | 99 | | **Adjusted pre-provision (reversal), pre-tax earnings (losses) $^{(3)}$** | **\$ 5,262** | **\$ 2,952** | **\$ 1,235** | **\$ 2,321** | **\$ (444)** | **\$ 11,326** | **\$ 910** | $^{(1)}$ Non-GAAP measure. $^{(2)}$ Items of note are removed from reported results to calculate adjusted results. $^{(3)}$ Adjusted to exclude the impact of items of note. Adjusted measures are non-GAAP measures. $^{(4)}$ Certain prior year information has been restated. See "External reporting changes" for additional details. 15 CIBC 2025 ANNUAL REPORT ## Strategic business units overview CIBC has four SBUs – Canadian Personal and Business Banking, Canadian Commercial Banking and Wealth Management, U.S. Commercial Banking and Wealth Management, and Capital Markets. These SBUs are supported by the following functional groups – Technology, Infrastructure and Innovation, Risk Management, People, Culture and Brand, and Finance and Enterprise Strategy, as well as other support groups, which all are included within Corporate and Other. The expenses of these functional and support groups are generally allocated to the business lines within the SBUs. Corporate and Other also includes the results of CIBC Caribbean and other portfolio investments, as well as other income statement and balance sheet items not directly attributable to the business lines. External reporting changes were made in the first quarter of 2025, which affected the results of our SBUs. See the "External reporting changes" section for additional details. ### Business unit allocations Revenue, expenses, and other balance sheet resources related to certain activities are generally allocated to the lines of business within the SBUs. Treasury activities impact the financial results of the SBUs. Each line of business within our SBUs is charged or credited with a market-based cost of funds on assets and liabilities, respectively, which impacts the revenue performance of the SBUs. This market-based cost of funds takes into account the cost of maintaining sufficient regulatory capital to support business requirements, including the cost of preferred shares. Once the interest and liquidity risks inherent in our client-driven assets and liabilities are transfer priced into Treasury, they are managed within CIBC's risk framework and limits. Capital is attributed to the SBUs based on the estimated amount of regulatory capital required to support their businesses, which is intended to consistently measure and align the costs with the underlying benefits and risks associated with SBU activities. Earnings on unattributed capital remain in Corporate and Other. We review our transfer pricing methodologies on an ongoing basis to ensure they reflect changing market environments and industry practices. We use a Product Owner/Customer Segment/Distributor Channel allocation management model to measure and report the results of operations of various lines of business within our SBUs. The model uses certain estimates and methodologies to process internal transfers between the impacted lines of business for sales, renewals and trailer commissions as well as certain attributable costs. Periodically, the sales, renewals and trailer commission rates paid to customer segments for certain products/services are revised and applied prospectively. The non-interest expenses of the functional and support groups are generally allocated to the business lines within the SBUs based on appropriate criteria and methodologies. The basis of allocation is reviewed periodically to reflect changes in support to business lines. Other costs not directly attributable to business lines remain in Corporate and Other. We recognize provision for credit losses on both impaired (stage 3) and performing (stages 1 and 2) loans in the respective SBUs. ### Revenue, taxable equivalent basis Prior to the third quarter of 2024, certain SBUs evaluated revenue on a TEB. In order to arrive at the TEB amount, the SBUs grossed up tax-exempt revenue on certain securities to a TEB, being the amount of fully taxable revenue, which, were it to have incurred tax at the statutory income tax rate, would yield the same after-tax revenue. Simultaneously, an equivalent amount was booked as an income tax expense resulting in no impact on the net income of the SBUs. This measure enabled comparability of revenue arising from both taxable and tax-exempt sources. The total TEB adjustments of the SBUs were offset in revenue and income tax expense in Corporate and Other. Commencing in the third quarter of 2024, TEB reporting is no longer applicable to certain dividends received on or after January 1, 2024. Also in the third quarter of 2024, the enactment of the denial of the dividends received deduction resulted in a TEB reversal for dividends received on or after January 1, 2024 that were included in the first and second quarters of 2024. 16 CIBC 2025 ANNUAL REPORT ## Canadian Personal and Business Banking Canadian Personal and Business Banking provides clients across Canada with financial solutions, services and advice through our dedicated team members in banking centres and contact centres, as well as leading mobile and online banking platforms to help make their ambitions a reality. ### Our business strategy Our goal is to be the leading relationship bank in Canada helping Canadians achieve their ambitions and delivering sustainable, market-leading performance. To achieve this, our strategy is focused on: * Building highly-engaged client relationships by being our clients' trusted partner for everyday financial solutions; * Growing our mass affluent business through our differentiated advisory network, innovative platforms and digital capabilities; and * Enhancing operational excellence through our people, technology and processes. ### 2025 progress This was a year of strong results and strategic progress across Personal and Business Banking, in which we continued to grow our client base, deepen relationships with high-growth client segments and strengthen our technology and talent, while simplifying our processes. A large contributor to this growth has been our ongoing delivery of high-quality financial planning and advice across our retail network, including our Imperial Service offer, supporting our clients through periods of increased market volatility and uncertainty over the course of the year. Our commitment to our clients was noted again this year with strong increases in our internal client satisfaction surveys. This was validated in external studies where we saw year-over-year improvements in both the J.D. Power Retail Banking Satisfaction study and Ipsos Customer Satisfaction Index net promoter score among primary clients. Additionally, CIBC ranked 1st in both online and mobile digital platforms in the 2025 J.D. Power Digital Satisfaction Studies and for the 10th consecutive year, achieved the \#1 ranking from financial advisors on the Investment Executive Report Card on Banks. #### Building highly-engaged client relationships by being our clients' trusted partner for everyday financial solutions * Launched CIBC Real-Time Experience (CIBC CRTEX), which leverages advanced analytics and AI to deliver personalized insights and banking experiences to enhance our overall relationships with clients. * Introduced our new Costco Banking Offer to provide Costco members with exclusive access to additional rewards when they open their first bank account with CIBC and started driving volumes through the roll out of CIBC Kiosks rotating at various Costco warehouses. * Launched a new, innovative, no annual fee CIBC Adapta Mastercard that automatically adapts to spending practices and rewards more for everyday purchases. * Partnered with Skip to offer CIBC credit and debit card clients access to exclusive benefits. * Ranked \#1 among the major banks for the third consecutive year in J.D. Power's 2025 Canada Credit Card Satisfaction Study, improving year-over-year in every category. * Opened a new banking centre at Toronto Pearson International Airport, welcoming a range of clients, including newcomers and international students. * Ranked \#1 in Canadian mobile banking, earning the highest ranking among the Big 6 banks in Surviscor's 2025 Consumer Mobile Banking Experience Review. * Introduced transit fee waivers, allowing clients to purchase tickets, reload cards, or tap at fare readers without these transactions counting toward monthly limits. #### Growing our mass affluent business through our differentiated advisory network, innovative platforms and digital capabilities * Leading with advice, our Imperial Service team developed and deepened relationships, which helped contribute to CIBC's 2nd place ranking (Securities and Investment Management Association) among the Big 6 banks for total mutual funds net sales. * Ranked \#1 by ISS Market Intelligence Investor Economics Deposit Report among no fee chequing account providers in Canada for our Simplii Financial offering for both total balances and number of accounts. * Established a new tiered Smart Account, which offers clients up to three accounts with unlimited transactions, enhanced benefits and rewards and automatic tier upgrades as they deepen their relationship with CIBC. * Launched CIBC's Skilled Trades Business Banking Program, offering business owners comprehensive solutions, exclusive offers and expert advice. This program builds on the success of our first-of-its-kind skilled trades Personal Banking program. * Launched the Business Client Advice Centre (BCAC) for improved client experience; and, launched a Skilled Trades Campaign and a dedicated BCAC line for the campaign. 17 CIBC 2025 ANNUAL REPORT #### Enhancing operational excellence through our people, technology and processes * Achieved record-high net promoter scores for Personal Banking and Imperial Service reflecting an exceptional level of client satisfaction. * Reached a significant milestone of 10 million digitally registered clients. * Saved a significant number of hours for our frontline team through process and technology enhancements, resulting in substantial efficiency gains. * Improved client experience by refreshing our award-winning mobile banking app through enhancements, such as Smart Search, home screen navigation and void cheque features. * Introduced several improvements to simplify and enhance the experience of Business Banking clients and team members across all processes, products and channels. * Established disputes automation for credit cards, decreasing call volumes and increasing service levels. * Enhanced client-initiated Credit Limit Increase in mobile and online banking, providing real-time decisions, reducing contact centre calls and improving client experience. * Launched a digital end-of-term mortgage renewal featuring e-sign capabilities, expected to save a considerable number of frontline hours. * Launched Digital Account Funding so clients can fund their accounts when opening an account digitally through FastApp. ### 2025 financial review | | Revenue $^{(1)}$ (\$ billions) | Net income $^{(1)}$ (\$ millions) | Operating leverage $^{(1)}$ (%) | Average loans and acceptances$^{(1)(2)(3)}$ (\$ billions) | Average deposits$^{(1)(3)}$ (\$ billions) | |---|---|---|---|---|---| | **24** | 10.9 | 2,905 | 4.8 | 330.6 | 245.8 | | **25** | 12.0 | 3,107 | 3.6 | 336.9 | 248.5 | $^{(1)}$ Certain prior year information has been restated. See the "External reporting changes" section for additional details. $^{(2)}$ Loan amounts are stated before any related allowances. $^{(3)}$ Average balances are calculated as a weighted average of daily closing balances. ### Our focus for 2026 In Canadian Personal and Business Banking, our objective is to be the leading relationship bank for our clients, delivering top-tier value for our stakeholders through differentiated advice, seamless client experience and operational excellence. We will continue to do this by: * Delivering seamless everyday banking solutions and best-in-class personalized advice to our clients; * Driving growth in key client segments by leveraging our differentiated front-line team, client engagement platforms and partnerships to acquire new clients and deepen existing relationships; and * Modernizing infrastructure and simplifying our operations to unlock front-line capacity, enhance client experience across channels and create capacity to reinvest in growth. 18 CIBC 2025 ANNUAL REPORT ## Canadian Commercial Banking and Wealth Management Canadian Commercial Banking and Wealth Management provides high-touch, relationship-oriented banking and wealth management services to middle-market companies, entrepreneurs, high-net-worth individuals and families across Canada. Our offering also includes an online brokerage platform for retail clients and asset management services for institutional investors. ### Our business strategy We are focused on building and enhancing client relationships, being a leading provider of financial services and advice to Commercial Banking and high-net-worth clients in Canada. Our key strategic priorities continue to be: * Delivering risk-controlled growth with a focus on relationship-banking and increasing connectivity to deepen relationships; * Focusing on high-growth market segments; and * Modernizing and simplifying our processes and systems. ### 2025 progress In 2025, our team continued to deliver strong results. In Canadian Commercial Banking, we navigated a challenging macroeconomic landscape to achieve risk-controlled growth, strengthening relationships by delivering holistic solutions tailored to our clients' needs. Our Canadian Wealth Management business advanced our strategy as a leading provider of financial advice to high-net-worth and ultra-high-net-worth clients and delivered solid performance. We empowered our clients to reach their financial goals through dedicated financial planning and ongoing investments in technology to further enhance the productivity of our advisors and teams. In Investor's Edge, our self-directed online investing platform, we've seen strong year-over-year growth, driven by prior investments in the platform and client solutions. CIBC Asset Management continues to see strong growth in long-term mutual fund net sales and is investing in enhanced distribution and product capabilities. Across our organization, cross-business referral momentum resulted in deeper, multi-faceted client relationships, reinforcing our commitment to helping our clients achieve their ambitions and positioning us for continued success in the years ahead. #### Delivering risk-controlled growth with a focus on relationship-banking and increasing connectivity to deepen relationships * Maintained strong net promoter score results in Commercial Banking, Private Banking and Wood Gundy, reflecting the confidence, loyalty and satisfaction that sets us apart as a trusted partner for our clients. * Continued to increase the number of financial plans completed, while maintaining focus on deepening client relationships and fostering strong partnerships. * Achieved strong year-over-year growth in commercial loans and deposits through proactive engagement and tailored solutions. #### Focusing on high-growth market segments * Wood Gundy ranked second overall among the Big 5 banks by Investment Executive Brokerage Report Card for the fourth consecutive year – a strong statement on the confidence of our advisory team. * Investor's Edge ranked first among the Big 5 banks in J.D. Power's do-it-yourself investing customer satisfaction survey. * CIBC was recognized as Canada's Top Private Bank by Global Finance and Global Banking & Finance Review, for its leadership and client-centric approach. * CIBC Asset Management ranked second among the Big 6 banks in year-to-date long-term mutual fund net sales as of October 2025, according to the Securities and Investment Management Association. #### Modernizing and simplifying our processes and systems * Advanced our modernization journey by upgrading platforms and streamlining digital processes, enabling faster and simpler client experiences, while driving efficiency. * Enhanced productivity through continued increased adoption of sales enablement tools, including Salesforce. * Introduced First Home Savings Account to Wood Gundy, expanding our product suite to meet the evolving needs of Canadians and their families. 20 CIBC 2025 ANNUAL REPORT ### 2025 financial review | | Revenue $^{(1)}$ (\$ billions) | Net income$^{(1)}$ (\$ millions) | Operating leverage $^{(1)}$ (%) | Average loans$^{(1)(2)(3)}$ (\$ billions) | Average deposits$^{(1)(3)}$ (\$ billions) | |---|---|---|---|---|---| | **24** | 6.0 | 2,063 | (2.7) | 98.5 | 105.5 | | **25** | 6.9 | 2,341 | (0.2) | 107.4 | 116.3 | | | Average commercial banking loans$^{(1)(2)(3)(4)}$ (\$ billions) | Average commercial banking deposits$^{(1)(3)}$ (\$ billions) | Assets under administration and management$^{(5)}$ (\$ billions) | Canadian retail mutual funds and exchange-traded funds (\$ billions) | |---|---|---|---|---| | **24** | 95.1 | 93.9 | 509.6 | 149.4 | | **25** | 103.7 | 102.4 | 597.2 | 175.2 | $^{(1)}$ Certain prior year information has been restated. See the "External reporting changes" section for additional details. $^{(2)}$ Loan amounts are stated before any related allowances. $^{(3)}$ Average balances are calculated as a weighted average of daily closing balances. $^{(4)}$ Comprises loans and acceptances and notional amount of letters of credit. $^{(5)}$ AUM amounts are included in the amounts reported under AUA. ### Our focus for 2026 Canadian Commercial Banking and Wealth Management remains focused on delivering profitable growth by being a leading provider of financial services and advice, and building deep relationships with commercial banking and high-net-worth clients. We will continue to do this by: * Deepening client relationships and increasing connectivity; * Focusing on high-growth segments, while investing in our capabilities; and * Empowering teams with improved technology, processes and data. 21 CIBC 2025 ANNUAL REPORT ## U.S. Commercial Banking and Wealth Management U.S. Commercial Banking and Wealth Management provides tailored, relationship-oriented banking and wealth management solutions across the U.S., focusing on middle-market and mid-corporate companies, entrepreneurs, high-net-worth individuals and families, as well as operating private and small business banking services in strategic markets across the U.S. ### Our business strategy We are a best-in-class, relationship-oriented commercial banking and wealth management franchise in the U.S., working closely with clients who value our high-touch approach, as well as our industry expertise and broad product capabilities, tailored to meet their specific needs. Our key strategic priorities continue to be: * Building and deepening client relationships; * Strengthening and diversifying our deposit base; * Improving efficiency and capabilities through data and technology; and * Advancing the growth and transformation of our business. ### 2025 progress In 2025, we continued to attract new clients and deepen relationships with existing clients through execution of our well-established relationship strategy. We are well positioned to help our clients achieve their ambitions by staying close, offering bespoke financial solutions and further improving client experiences, which is reflected in our strong net promoter scores. We delivered broad-based deposit and commercial and industrial loan growth, and built positive momentum by continuing to generate new business and AUM growth. The strategic investments we've made in our business combined with disciplined expense and risk management will support our momentum and growth moving forward. #### Building and deepening client relationships * Continued growth in relationship expansion efforts across all areas of the bank that drove new business and delivered more services across our bank to our existing clients. * Generated loan growth through new strategic client relationships and developed additional private banking business with existing commercial and wealth clients. * Maintained positive AUM and AUA net flows. * Further enhanced the strong connectivity with our Capital Markets team to provide a range of financial solutions to U.S. commercial and wealth clients. * Ranked \#6 Registered Investment Advisor in Barron's Top 100 RIA Firms list; remaining in the top 10 for the sixth consecutive year. * CIBC Private Wealth remains Private Asset Management's most awarded firm in the industry over the last 15 years. #### Strengthening and diversifying our deposit base * Maintained a diversified deposit base across our commercial, private banking and personal clients. * Expanded deposit gathering by attracting new clients to our CIBC Agility digital banking platform that provides flexible online banking. * Earned recognition from Money.com for having the Best High-Yield Savings Accounts of 2025. #### Improving efficiency and capabilities through data and technology * Continued investments in modernizing our bank, including enhancements to our wires platform, expanded client relationship management tools and enhanced anti-money laundering capabilities, helping to transform our bank to support future growth. * Enhanced our award-winning Private Wealth investment platform, allowing us to deliver improved client experience. * Advancements in risk management capabilities leading to better data analytics, which enhanced insights into our loan and deposit portfolios. #### Advancing the growth and transformation of our business * Continued growth of our Wealth Management franchise, a business that provides strong returns on capital by building scale, acquiring top talent and deploying technology that drives industry-leading client experiences. * Maintained risk-controlled growth in Commercial Banking, while strategically allocating capital, to deliver new products and services. * Continued to enhance our risk culture to support our growth. ### 2025 financial review | | Revenue $^{(1)}$ (US\$ billions) | Net income$^{(1)}$ (\$ millions) | Net income $^{(1)}$ (US\$ millions) | Operating leverage $^{(1)}$ (% in U.S. dollars) | |---|---|---|---|---| | **24** | 2.1 | 500 | 368 | (11.9) | | **25** | 2.3 | 958 | 685 | 5.5 | $^{(1)}$ Certain prior year information has been restated. See the "External reporting changes" section for additional details. | | Average loans$^{(1)(2)}$ (US\$ billions) | Average deposits $^{(2)}$ (US\$ billions) | Average commercial banking loans$^{(1)(2)}$ (US\$ billions) | Assets under administration and management$^{(3)}$ (US\$ billions) | |---|---|---|---|---| | **24** | 40.2 | 37.2 | 36.1 | 107.1 | | **25** | 41.6 | 42.2 | 37.3 | 111.8 | $^{(1)}$ Loan amounts are stated before any related allowances. $^{(2)}$ Average balances are calculated as a weighted average of daily closing balances. $^{(3)}$ AUM amounts are included in the amounts reported under AUA. ### Our focus for 2026 To build on our momentum across U.S. Commercial Banking and Wealth Management, we will be guided by our purpose as we help make our clients' ambitions a reality. We will continue to do this by: * Expanding Private Wealth Management with a focus on strategic relationships; * Growing Commercial Banking by delivering the full connected capabilities of our bank, industry expertise and deepening client relationships; and * Investing in people, technology and infrastructure to further scale our platform, drive connectivity and enhance data-driven decisioning. ### Results in Canadian dollars$^{(1)}$ \$ millions, for the year ended October 31 | | 2025 | 2024 $^{(2)}$ | |---|---|---| | **Revenue** | | | | Commercial banking | \$ 2,224 | \$ 1,971 | | Wealth management | 992 | 849 | | **Total revenue** | **3,216** | **2,820** | | **Provision for (reversal of) credit losses** | | | | Impaired | 268 | 449 | | Performing | (93) | 111 | | **Total provision for credit losses** | **175** | **560** | | Non-interest expenses | 1,861 | 1,718 | | Income before income taxes | 1,180 | 542 | | Income taxes | 222 | 42 | | **Net income** | **\$ 958** | **\$ 500** | | **Net income attributable to:** | | | | Equity shareholders | \$ 958 | \$ 500 | | **Total revenue** | **\$ 2,205** | **\$ 1,906** | | Net interest income | 1,011 | 914 | | Non-interest income | \$ 3,216 | \$ 2,820 | | Average allocated common equity $^{(3)}$ | \$ 11,380 | \$ 11,051 | | Average assets (\$ billions) | \$ 64.4 | \$ 60.8 | | Average loans (\$ billions) | \$ 58.1 | \$ 54.7 | | Average deposits (\$ billions) | \$ 59.0 | \$ 50.6 | | AUA (\$ billions) $^{(4)}$ | \$ 156.8 | \$ 149.2 | | AUM (\$ billions) $^{(4)}$ | \$ 129.1 | \$ 117.9 | | Full-time equivalent employees | 3,189 | 3,005 | $^{(1)}$ For additional segmented information, see Note 29 to the consolidated financial statements. $^{(2)}$ Certain prior year information has been restated. See the "External reporting changes" section for additional details. $^{(3)}$ For additional information, see the "Non-GAAP measures" section. $^{(4)}$ Includes certain Canadian Commercial Banking and Wealth Management assets that U.S. Commercial Banking and Wealth Management provides sub-advisory services for. ### Results in U.S. dollars$^{(1)}$ US\$ millions, for the year ended October 31 | | 2025 | 2024 $^{(2)}$ | |---|---|---| | **Revenue** | | | | Commercial banking | \$ 1,585 | \$ 1,450 | | Wealth management | 708 | 624 | | **Total revenue** | **2,293** | **2,074** | | **Provision for (reversal of) credit losses** | | | | Impaired | 191 | 330 | | Performing | (67) | 82 | | **Total provision for credit losses** | **124** | **412** | | Non-interest expenses | 1,326 | 1,263 | | Income before income taxes | 843 | 399 | | Income taxes | 158 | 31 | | **Net income** | **\$ 685** | **\$ 368** | | **Net income attributable to:** | | | | Equity shareholders | \$ 685 | \$ 368 | | **Total revenue** | **\$ 1,572** | **\$ 1,402** | | Net interest income | 721 | 672 | | Non-interest income | **\$ 2,293** | **\$ 2,074** | | Net interest margin on average interest-earning assets $^{(3)}$ | 3.79% | 3.49% | | Efficiency ratio | 57.9% | 60.9% | | Operating leverage | 5.5% | (11.9)% | | Return on equity $^{(4)}$ | 8.4% | 4.5% | | Average allocated common equity $^{(4)}$ | \$ 8,111 | \$ 8,129 | | Average assets (\$ billions) | \$ 46.1 | \$ 44.7 | | Average loans (\$ billions) | \$ 41.6 | \$ 40.2 | | Average deposits (\$ billions) | \$ 42.2 | \$ 37.2 | | AUA (\$ billions) $^{(5)}$ | \$ 111.8 | \$ 107.1 | | AUM (\$ billions) $^{(5)}$ | \$ 92.0 | \$ 84.7 | $^{(1)}$ For additional segmented information, see Note 29 to the consolidated financial statements. $^{(2)}$ Certain prior year information has been restated. See the "External reporting changes" section for additional details. $^{(3)}$ For additional information on the composition, see the "Glossary" section. $^{(4)}$ For additional information, see the "Non-GAAP measures" section. $^{(5)}$ Includes certain Canadian Commercial Banking and Wealth Management assets that U.S. Commercial Banking and Wealth Management provides sub-advisory services for. ### Financial overview Net income was up \$458 million or 92% (US\$317 million or 86%) from 2024, primarily due to higher revenue and a lower provision for credit losses, partially offset by higher non-interest expenses, as well as the favourable impact of foreign exchange translation. Revenue Revenue was up US\$219 million or 11% from 2024. Commercial banking revenue was up US\$135 million or 9%, primarily due to volume growth and higher net interest margin. Wealth management revenue was up US\$84 million or 13%, primarily due to higher fee-based revenue from higher average AUM balances attributable to market appreciation, higher annual performance-based mutual fund fees, and higher deposit volumes. Net interest margin on average interest-earning assets was up 30 basis points, primarily due to favourable business mix and higher deposit margins. Provision for credit losses Provision for credit losses was down US\$288 million or 70% from 2024. The current year included a provision reversal on performing loans due to favourable credit migration within the performing portfolio, as well as higher allowance releases for credit migration from the performing to the impaired portfolio, partially offset by an unfavourable change in our economic outlook in the U.S. The prior year included a provision on performing loans primarily due to model parameter updates. Provision for credit losses on impaired loans was down due to lower provisions in the real estate and construction sector. Non-interest expenses Non-interest expenses were up US\$63 million or 5% from 2024, primarily due to higher employee compensation and higher spending on strategic initiatives, partially offset by a US\$77 million charge in the prior year related to the special assessment imposed by the FDIC, which was shown as an item of note. Income taxes Income taxes were up US\$127 million from 2024, due to higher income and earnings mix. Average assets Average assets were comparable to 2024. Assets under administration AUA were up US\$4.7 billion or 4% from 2024, primarily due to market appreciation. AUM amounts are included in the amounts reported under AUA. 23 CIBC 2025 ANNUAL REPORT ## Capital Markets Capital Markets provides integrated global markets products and services, investment banking and corporate banking solutions, and top-ranked research to our clients around the world. Leveraging the capabilities of our differentiated platform, Capital Markets also delivers multi-currency payments and innovative solutions for clients across our bank. ### Our business strategy Our ambition is to be the leading client-centric capital markets solution provider in Canada and in select U.S. and international verticals, delivering leading best-in-class insight, advice and execution to our North American and international clients. To enable CIBC's strategy and priorities, we collaborate with our partners across our bank to deepen and enhance client relationships. Our key strategic priorities continue to be: * Delivering the leading capital markets platform in Canada to our Strategic and Focus clients; * Building a North American client platform with global capabilities; and * Focusing on connectivity to accelerate growth and deepen relationships across our bank. ### 2025 progress 2025 was a year of significant progress where we again demonstrated our consistent execution and steady growth. We continued to deliver on our U.S. growth ambitions, driving double-digit revenue growth in this important market. This was achieved through targeted investments, expanding our teams across key businesses, and further developing our strong product and service offerings. Within Canada, we maintained strong market share with our Strategic and Focus clients in a highly competitive landscape. This underscores the value of our deep client relationships, the success of our differentiated platform, and our ability to deliver a connected bank to all our clients. #### Delivering the leading capital markets platform in Canada to our Strategic and Focus clients * Continued delivering industry-leading advice and capital markets solutions by expanding our capabilities and expertise, securing a market share of 14.2% among Strategic and Focus clients in Canada, while maintaining leading growth, productivity, efficiency and returns versus peers. * Maintained resource discipline and selectively invested in innovative capabilities and technology to further grow with our clients, strengthen our platform, and simplify processes to enable our client-focused culture. * Recognized by Global Finance for the third consecutive year as the Best Investment Bank in Canada and for our leadership in environmental and social sustainability financing, receiving three sustainable finance awards from Global Finance, including Best Sustainable Finance Bank in Canada. * Recognized by Global Capital for the second consecutive year as the Most Impressive SSA House for the Canadian Market and Canada Derivatives House of the Year. * Awarded Best Market Maker/Authorised Participant - Fixed Income Exchange Traded Funds (ETF) in Canada by ETF Express. #### Building a North American client platform with global capabilities * Continued to expand our U.S. franchise by making key strategic hires and adding capabilities for our corporate, institutional and private capital clients to enable double-digit revenue growth. * Built out leveraged finance capabilities, technology and expertise in the U.S. to expand our business with financial sponsors, pension funds and corporate clients in this fast-growing product area. * Furthered our reputation as a leader in the renewable energy sector in the U.S., ranking sixth among investment banks for renewables project financing, according to InfraLogic and IJGlobal. * Ranked \#1 for US\$ Supranational, Sovereign, and Agency by Market Axess. * Awarded Financial Adviser of the Year in North America by IJGlobal for the second consecutive year. * Recognized as the Global Lender of the Year by IJGlobal ESG Awards. #### Focusing on connectivity to accelerate growth and deepen relationships across our bank * Delivered Capital Markets solutions to personal banking, high-net-worth and commercial banking clients across our bank. * Further expanded our industry-first Canadian Depositary Receipts lineup as part of our ongoing commitment to developing innovative, market-based solutions that meet investor needs. * Focused on connectivity to deepen relationships across the bank by making referrals to Commercial Banking and Wealth Management, ensuring our clients experience one strong integrated bank. * Accelerated growth for our Global Structured Notes and Market-Linked GICs offerings, reaching a record high of \$43 billion outstanding. As a leading capital markets franchise in Canada and banking partner to our clients around the world, Capital Markets acted as: * Financial advisor to Innergex Renewable Energy Inc. on its sale to CDPQ for a transaction value of approximately \$10 billion and participant on \$1.2 billion in new credit facilities for CDPQ Bidco to support the acquisition. * Financial advisor to Brookfield Asset Management and Birch Hill Equity Partners on the acquisition of a majority interest in First National Financial Corporation for a transaction value of approximately \$3.6 billion including acting as co-underwriter, joint bookrunner and co-lead arranger on a new revolver and term loan for Regal Bidco Inc. and active joint bookrunner on an \$800 million multi tranche issue of senior notes for First National Financial Corporation to support the transaction. * Financial advisor to Gildan Activewear Inc. on the acquisition of HanesBrands Inc. for a transaction value of approximately US\$4.4 billion including acting as co-underwriter, joint bookrunner and co-lead arranger on a new US\$1.2 billion bridge and US\$1.1 billion in term loans, and active bookrunner on a US\$1.2 billion dual tranche issue of senior unsecured notes in support of the transaction. * Joint lead arranger and joint bookrunner on approximately US\$2.5 billion of senior secured credit facilities to finance the acquisition of a majority of GFL's Environmental Services business by BC Partners and Apollo and hedge counterparty in support of the transaction. * Joint bookrunner on the issuance of \$2.1 billion of subscription receipts, \$2.3 billion of multi tranche senior notes and \$500 million of hybrid notes, and joint bookrunner and co-lead arranger on a new \$2.5 billion bridge, \$850 million term loan and a \$500 million increase to the existing revolver in connection with Keyera Corp.'s acquisition of Plains Midstream Canada ULC's natural gas liquids business and select U.S. assets. * Exclusive advisor, sole lead placement agent, left lead arranger and administrative agent and swap coordinator to Boldyn Networks U.S. on a US\$1.2 billion financing to support the integration of its U.S. businesses and fuel future growth and innovation. 26 CIBC 2025 ANNUAL REPORT * Financial advisor, joint lead placement agent, mandated lead arranger, and hedge counterparty to Adven Group Oy on an approximately €675 million refinancing to enable its growth trajectory. * Sustainability structuring agent in partnership with CIBC Caribbean who also acted as lead arranger on the Government of Barbados' bespoke US\$300 million (equivalent) sustainability-linked loan and debt-for-climate resilience loan facility. CIBC also acted as joint bookrunner or joint lead arranger on multiple green and sustainable bond issuances, including TransAlta's \$450 million green bond, Hydro One's aggregate \$750 million dual-tranche sustainability and green bonds, and Government of Canada's February 2025 \$2 billion green bond. ### 2025 financial review | | Revenue $^{(1)}$ (\$ billions) | Net income $^{(1)}$ (\$ millions) | Operating leverage $^{(1)}$ (%) | |---|---|---|---| | **24** | 4.8 | 1,629 | 13.0 | | **25** | 6.1 | 2,273 | (4.7) | | | Average loans and acceptances $^{(1)(2)}$ (\$ billions) | Average deposits$^{(1)(2)}$ (\$ billions) | Average value-at-risk (VaR) (\$ millions) | |---|---|---|---| | **24** | 60.6 | 94.1 | 11.0 | | **25** | 69.9 | 103.6 | 11.4 | $^{(1)}$ Certain prior year information has been restated. See the "External reporting changes" section for additional details. $^{(2)}$ Average balances are calculated as a weighted average of daily closing balances. ### Our focus for 2026 To support our bank's long-term objectives, Capital Markets remains focused on delivering profitable growth by deepening client relationships and collaborating with our partners across our bank to help make our clients' ambitions a reality. We will continue to do this by: * Maintaining our focused approach to client coverage in Canada; * Growing our North American platform by further expanding our U.S. reach and broadening the services offered to clients; and * Strengthening our connectivity, technology and innovation efforts to bring more of our bank's offerings to our clients. 27 CIBC 2025 ANNUAL REPORT ## Corporate and Other Corporate and Other includes the following functional groups – Technology, Infrastructure and Innovation, Risk Management, People, Culture and Brand, and Finance and Enterprise Strategy, as well as other support groups. The expenses of these functional and support groups are generally allocated to the business lines within the SBUs. Corporate and Other also includes the results of CIBC Caribbean and other portfolio investments, as well as other income statement and balance sheet items not directly attributable to the business lines. ### Results$^{(1)}$ \$ millions, for the year ended October 31 | | 2025 | 2024$^{(2)}$ | |---|---|---| | **Revenue** | | | | Global markets $^{(2)}$ | \$ 3,996 | \$ 3,055 | | Corporate and investment banking | 2,152 | 1,745 | | **Total revenue $^{(3)}$** | **6,148** | **4,800** | | **Provision for credit losses** | | | | Impaired | 117 | 55 | | Performing | 91 | 29 | | **Total provision for credit losses** | **208** | **84** | | Non-interest expenses | 2,855 | 2,479 | | Income before income taxes | 3,085 | 2,237 | | Income taxes $^{(3)}$ | 812 | 608 | | **Net income** | **\$ 2,273** | **\$ 1,629** | | **Net income attributable to:** | | | | Equity shareholders | \$ 2,273 | \$ 1,629 | | | 2025 | 2024 | |---|---|---| | Efficiency ratio | 46.4% | 51.7% | | Operating leverage | 13.0% | (4.7)% | | Return on equity $^{(4)}$ | 22.1% | 17.9% | | Average allocated common equity $^{(4)}$ | \$ 10,291 | \$ 9,100 | | Average assets (\$ billions) | \$ 378.5 | \$ 315.3 | | Average loans and acceptances (\$ billions) | \$ 69.9 | \$ 60.6 | | Average deposits (\$ billions) | \$ 103.6 | \$ 94.1 | | Full-time equivalent employees | 2,011 | 1,858 | $^{(1)}$ For additional segmented information, see Note 29 to the consolidated financial statements. $^{(2)}$ Certain prior year information has been restated. See the "External reporting changes" section for additional details. In addition to the changes to our SBUs, our foreign exchange and payments business is now included in Global markets within Capital Markets. Previously, this business was included in Direct Financial Services within Capital Markets together with Simplii and Investor's Edge. Prior period information has been restated. $^{(3)}$ Prior to the enactment of the Federal tax measure that denied the dividends received deduction for Canadian banks in June 2024, Capital Markets revenue and income taxes were reported on a TEB with an equivalent offset in the revenue and income taxes of Corporate and Other. Accordingly, the 2024 revenue and income taxes included a TEB adjustment of \$16 million for dividends received before January 1, 2024. $^{(4)}$ For additional information, see the "Non-GAAP measures" section. ### Financial overview Net income was up \$644 million or 40% from 2024, primarily due to higher revenue, partially offset by higher non-interest expenses and a higher provision for credit losses. Revenue Revenue was up \$1,348 million or 28% from 2024. Global markets revenue was up \$941 million or 31%, primarily due to higher equity trading, financing revenue and higher commodities trading revenue. Corporate and investment banking revenue was up \$407 million or 23%, primarily due to higher corporate banking revenue and higher debt underwriting, advisory and equity underwriting revenue. Provision for credit losses Provision for credit losses was up \$124 million or 148% from 2024. Provision for credit losses on performing loans was up due to unfavourable credit migration and a more unfavourable change in our economic outlook in the current year. Provision for credit losses on impaired loans was up due to higher provisions in the telecommunications and cable sector. Non-interest expenses Non-interest expenses were up \$376 million or 15% from 2024, primarily due to higher employee compensation and higher spending on technology and other strategic initiatives. Income taxes Income taxes were up \$204 million from 2024, primarily due to higher income and earnings mix. Average assets Average assets were up \$63.2 billion or 20% from 2024, primarily due to higher trading securities, higher loan balances, higher securities purchased under resale agreements and higher derivatives valuation. 28 CIBC 2025 ANNUAL REPORT ## Corporate and Other Corporate and Other includes the following functional groups – Technology, Infrastructure and Innovation, Risk Management, People, Culture and Brand, and Finance and Enterprise Strategy, as well as other support groups. The expenses of these functional and support groups are generally allocated to the business lines within the SBUs. Corporate and Other also includes the results of CIBC Caribbean and other portfolio investments, as well as other income statement and balance sheet items not directly attributable to the business lines. ### Results$^{(1)}$ \$ millions, for the year ended October 31 | | 2025 | 2024 | |---|---|---| | **Revenue** | | | | International banking | \$ 905 | \$ 980 | | Other | (69) | 46 | | **Total revenue $^{(2)}$** | **836** | **1,026** | | **Provision for (reversal of) credit losses** | | | | Impaired | 25 | 12 | | Performing | 4 | (11) | | **Total provision for credit losses** | **29** | **1** | | Non-interest expenses | 1,547 | 1,470 | | Loss before income taxes | (740) | (445) | | Income taxes $^{(2)}$ | (515) | (502) | | **Net income (loss)** | **\$ (225)** | **\$ 57** | | **Net income (loss) attributable to:** | | | | Non-controlling interests | \$ 25 | \$ 39 | | Equity shareholders $^{(3)}$ | (250) | 18 | | Full-time equivalent employees $^{(3)}$ | 24,607 | 24,026 | $^{(1)}$ For additional segmented information, see Note 29 to the consolidated financial statements. $^{(2)}$ Prior to the enactment of the Federal tax measure that denied the dividends received deduction for Canadian banks in June 2024, Capital Markets revenue and income taxes were reported on a TEB with an equivalent offset in the revenue and income taxes of Corporate and Other. Accordingly, the 2024 revenue and income taxes included a TEB adjustment offset of \$16 million for dividends received before January 1, 2024. $^{(3)}$ Includes full-time equivalent employees for which the expenses are allocated to the business lines within the SBUs. The majority of the full-time equivalent employees for functional and support costs of CIBC Bank USA are included in the U.S. Commercial Banking and Wealth Management SBU. ### Financial overview Net income was down \$282 million from 2024, due to lower treasury and International banking revenue, higher non-interest expenses and higher provision for credit losses, partially offset by higher revenue from our strategic investments. Revenue Revenue was down \$190 million from 2024. International banking revenue was down \$75 million, primarily due to investment losses, lower margins and impairment of debt securities measured at amortized cost, partially offset by volume growth and higher fee income. Other revenue was down \$115 million, primarily due to lower treasury revenue, partially offset by higher revenue from our strategic investments. Provision for (reversal of) credit losses Provision for credit losses in International banking was up \$28 million from 2024. The current year included a modest provision for credit losses on performing loans, while the same period last year included a provision reversal reflective of an improvement in our economic outlook. Provision for credit losses on impaired loans was up mainly attributable to the business services sector. Non-interest expenses Non-interest expenses were up \$77 million from 2024, primarily due to higher corporate costs, including from higher employee termination costs and legal provisions. 29 CIBC 2025 ANNUAL REPORT # Financial condition ## Review of condensed consolidated balance sheet \$ millions, as at October 31 | Assets | 2025 | 2024$^{(1)}$ | |---|---|---| | Cash and deposits with banks | \$ 44,003 | \$ 48,064 | | Securities | 283,235 | 254,345 | | Securities borrowed and purchased under resale agreements | 108,392 | 100,749 | | Loans and acceptances | 589,504 | 558,292 | | Derivative instruments | 38,352 | 36,435 | | Other assets | 53,452 | 44,100 | | **Total assets** | **\$ 1,116,938** | **\$ 1,041,985** | | **Liabilities and equity** | | | | Deposits | \$ 808,124 | \$ 764,857 | | Obligations related to securities lent, sold short and under repurchase agreements | 160,317 | 139,792 | | Derivative instruments | 41,411 | 40,654 | | Other liabilities $^{(1)}$ | 34,854 | 30,210 | | Subordinated indebtedness | 7,819 | 7,465 | | Equity | 64,413 | 59,007 | | **Total liabilities and equity** | **\$ 1,116,938** | **\$ 1,041,985** | $^{(1)}$ Includes acceptances of \$10 million (2024: \$6 million). Prior year amounts have been revised to conform to the presentation adopted in 2025. Assets Total assets as at October 31, 2025 were up \$75.0 billion or 7% from 2024, of which approximately \$3.8 billion was due to the appreciation of the U.S. dollar. Cash and deposits with banks decreased by \$4.1 billion or 8%, primarily due to lower short-term placements in Treasury. Securities increased by \$28.9 billion or 11%, primarily due to increases in equity trading securities, debt security portfolios in our trading businesses and Treasury, and asset-backed securities. Securities borrowed and purchased under resale agreements increased by \$7.6 billion or 8%, primarily due to client-driven activities. Net loans and acceptances increased by \$31.2 billion or 6%, primarily due to increases in business and government loans, and the Canadian residential mortgage portfolio. Further details on the composition of loans and acceptances are provided in the "Supplementary annual financial information" section and Note 5 to the consolidated financial statements. Derivative instruments increased by \$1.9 billion or 5%, largely driven by an increase in foreign exchange and commodity derivatives valuation. Other assets increased by \$9.4 billion or 21%, primarily due to increases in broker receivables, precious metals and carbon emission allowances, collateral pledged for derivatives and other receivables. Liabilities Total liabilities as at October 31, 2025 were up \$69.5 billion or 7% from 2024, of which approximately \$3.7 billion was due to the appreciation of the U.S. dollar. Deposits increased by \$43.3 billion or 6%, primarily due to increases in business and government deposits, wholesale funding, and retail volume growth. Further details on the composition of deposits are provided in Note 10 to the consolidated financial statements and the "Supplementary annual financial information" section. Obligations related to securities lent, sold short and under repurchase agreements increased by \$20.5 billion or 15%, primarily to finance growth in client-driven activities. Derivative instruments increased by \$0.8 billion or 2%, largely driven by increases in equity and commodity derivatives valuation, partially offset by decreases in the interest rate and foreign exchange derivatives valuation. Other liabilities increased by \$4.6 billion or 15%, primarily due to increases in payables related to precious metals, collateral pledged for derivatives, accrued employee compensation and brokers payables, partially offset by a decrease in accrued interest payable. Subordinated indebtedness increased by \$0.4 billion or 5%, primarily due to the issuance of subordinated indebtedness in the second quarter, partially offset by the redemption of subordinated indebtedness in the third quarter. For further details see the "Capital management" section. Equity Equity as at October 31, 2025 increased by \$5.4 billion or 9% from 2024, primarily due to net income that exceeded dividends and distributions, an increase in Limited Recourse Capital Notes (LRCNs) and preferred shares, a net increase in accumulated other comprehensive income (AOCI) mainly resulting from net gains on cash flow hedges and net gains in debt securities measured at FVOCI, partially offset by the impact of shares repurchased and cancelled under normal course issuer bids (NCIBs). For further details see the "Capital management" section. 30 CIBC 2025 ANNUAL REPORT ## Capital management Our capital strength protects our depositors and creditors from risks inherent in our businesses. Our overall capital management objective is to maintain a strong and efficient capital base that: * Acts as a buffer to absorb unexpected losses while providing sustainable returns to our shareholders; * Enables our businesses to grow and execute on our strategy; * Demonstrates balance sheet strength and our commitment to prudent balance sheet management; and * Supports us in maintaining a favourable credit standing and raising additional capital or other funding on attractive terms. We actively manage our capital to meet these objectives in support of our overall enterprise strategy. We also consider the economic outlook, and the overall operating environment when deploying our capital and may choose to operate with greater levels of capital based on our view of potential downside risks. ### Capital management and planning framework We maintain a capital management policy that establishes our capital management principles in the context of our risk appetite to support our capital management objectives. Our capital management policy is reviewed and approved by the Board of Directors (the Board) in support of our Internal Capital Adequacy Assessment Process (ICAAP). The policy includes guidelines that relate to capital strength, capital mix, dividends and return of capital, and unconsolidated capital adequacy of regulated entities, based on regulatory requirements and our risk appetite. The level of capital and capital ratios are continually monitored relative to our regulatory minimums and internal targets and the amount of capital required may change in relation to our business growth, risk appetite, and the business and regulatory environment. Capital planning is a crucial element of our overall financial planning process and establishment of strategic objectives and is developed in accordance with the capital management policy. Each year, a capital plan and three-year outlook are developed as part of the financial plan, which establishes targets for the coming year and business plans to achieve those targets. The capital plan is also stress-tested as a part of our enterprise-wide stress testing process to ensure CIBC is adequately capitalized through severe but plausible stress scenarios (see the "Enterprise-wide stress testing" section for further details). Our capital position and forecasts are monitored throughout the year and assessed against the capital plan. The Board, with endorsement from the Risk Management Committee (RMC), provides oversight of CIBC's capital management through the approval of our risk appetite, capital policy and plan. The RMC and the Board are provided with regular updates on our capital position including performance to date, updated forecasts, and any material regulatory developments that may impact our future capital position. Treasury is responsible for the overall management of capital including planning, forecasting and execution of the plan, with senior management oversight provided by the Global Asset Liability Committee (GALCO). ### Enterprise-wide stress testing We perform enterprise-wide stress testing on at least an annual basis. The results are an integral part of our ICAAP, as defined by Pillar 2 of the Basel III Accord, wherein we identify and measure our risks on an ongoing basis in order to ensure that the capital available is sufficient to cover all risks across CIBC, including the impacts of stress testing. We maintain a process that determines plausible but stressed economic scenarios such as global recessions and housing price shocks, and then apply these stress scenarios to our bank-wide exposures to determine the impact on the consolidated statement of income, RWA requirements, and consequently, key capital ratios. This helps us analyze the potential risks within our portfolios and establish prudent capital levels in excess of the regulatory minimum requirements. All of the elements of capital are monitored throughout the year and the capital plan is adjusted as appropriate. Management determines the range of scenarios to be tested. Macroeconomic stress test scenarios are designed to be both severe and plausible and designed to be consistent with OSFI's stress testing framework to ensure that they are comprehensive. 31 CIBC 2025 ANNUAL REPORT The following diagram summarizes the enterprise-wide stress testing process, including the development of scenarios, identification of risk drivers and linkages to our other bank-wide ICAAP processes. The process includes syndication with our economists and lines of business to ensure scenarios are relevant to our businesses and there is a consistent interpretation of the scenarios across CIBC. ```mermaid graph TD A[Scenario Development: Develop macroeconomic scenarios relevant to the current and projected business cycle including emerging risks] --> B(Risk Identification/Modelling: Identification of relevant risk drivers, Development and validation of stress models and parameters); B --> C{Translation of financial and macroeconomic factors (e.g., GDP, unemployment, yield curve, etc.)}; C --> D1[Quantify impacts: Credit]; C --> D2[Quantify impacts: Market]; C --> D3[Quantify impacts: Operational]; C --> D4[Quantify impacts: Liquidity]; C --> D5[Quantify impacts: Earnings]; C --> D6[Quantify impacts: Other]; D1 & D2 & D3 & D4 & D5 & D6 --> E[Aggregate results]; E --> F[Evaluate and review bank-wide impacts: Capital Impacts, Earnings, Funding and Liquidity]; F --> G[Linkages: Internal Capital Adequacy Assessment Process (ICAAP)]; G --> H1[Risk Appetite]; G --> H2[Capital Management and Planning]; G --> H3[Financial Management and Planning]; G --> H4[Liquidity Management]; G --> H5[Recovery and Resolution Planning]; G --> H6[Risk Management]; ``` Stress test scenarios are designed to capture a wide range of macroeconomic and financial variables that are relevant to assess the impact on our specific portfolios. This includes, for example, gross domestic product (GDP), unemployment, house prices, interest rates and equity prices. The stress testing process is comprehensive, using a bottoms-up analysis of each of our bank-wide portfolios, and the results are analyzed on a product, location and sector basis. Our stress testing approach combines the use of statistical models and expert judgment to ensure the results are reasonable in estimating the impacts of the stress scenarios. Stress testing methodologies and results are subject to a detailed review and challenge from both our lines of business and Risk Management. Stress testing results are presented for review to the RMC and are also shared with the Board and OSFI. The results of our enterprise-wide stress testing are used to highlight any vulnerabilities and ensure we remain well capitalized against regulatory and management expectations. A key objective of the enterprise-wide stress tests is to identify key areas of exposure and foster discussion of management actions that would be taken to mitigate the impact of stress scenarios. Contingency planning and strategies for extreme stress scenarios are included in the development and maintenance of CIBC's recovery and resolution plans. These plans include credible remedial actions that may be considered to counteract and recover from stress, or promote CIBC's orderly resolution with limited systemic impacts. Additional information on stress testing is provided in the "Management of risk" section. ### Recovery plan Federally regulated financial institutions (FRFIs) must maintain robust and credible recovery plans that identify options to restore financial strength and viability when under severe stress. CIBC continues to maintain and update its recovery plan in line with OSFI requirements and industry best practices. ### Resolution plan The Canada Deposit Insurance Corporation (CDIC) Resolution Planning By-law establishes a statutory framework pursuant to which domestic systemically important banks (D-SIBs) submit and maintain resolution plans that are critical to support resolvability and financial sector stability. CDIC, Canada's resolution authority for its member institutions, including D-SIBs, has issued guidance for the development, maintenance and testing of comprehensive resolution plans and related strategies to demonstrate their operational capability, thus ensuring resolvability can be achieved in an orderly fashion. CIBC's resolution plan has been developed and maintained in alignment with guidance and is in compliance with CDIC's Resolution Planning By-law. 32 CIBC 2025 ANNUAL REPORT ## Regulatory capital and total loss absorbing capacity (TLAC) requirements Our regulatory capital requirements are determined in accordance with guidelines issued by OSFI, which are based upon the capital standards developed by the BCBS. Regulatory capital consists of CET1, Tier 1 and Tier 2 capital. Qualifying regulatory capital instruments must be capable of absorbing loss at the point of non-viability of the financial institution. The tiers of regulatory capital indicate increasing quality/permanence and the ability to absorb losses. The major components of our regulatory capital are summarized as follows: * **CET1 capital** * Common equity (retained earnings, common shares and stock surplus) * Accumulated other comprehensive income (AOCI) $^{(1)}$ * Qualifying instruments issued by a consolidated banking subsidiary to third parties * Less regulatory deductions for items such as: * Goodwill and other intangible assets * Deferred tax assets * Net assets related to defined benefit pension plans * Certain investments * **Additional Tier 1 (AT1) capital** * Non-viability contingent capital (NVCC) preferred shares * Limited recourse capital notes * Qualifying instruments issued by a consolidated subsidiary to third parties * **Tier 2 capital** * NVCC subordinated indebtedness * Eligible general allowance * Qualifying instruments issued by a consolidated subsidiary to third parties $^{(1)}$ Excluding AOCI relating to cash flow hedges and changes to fair value option (FVO) liabilities attributable to changes in own credit risk. OSFI requires all institutions to achieve target capital ratios, which include buffers. Targets may be higher for certain institutions at OSFI's discretion. CIBC has been designated by OSFI as a D-SIB in Canada. D-SIBs are subject to a CET1 surcharge equal to 1.0% of RWA. In addition, OSFI expects D-SIBs to hold a Domestic Stability Buffer (DSB) requirement intended to address Pillar 2 risks that are not adequately captured in the Pillar 1 capital requirements. The DSB is currently set at 3.5% of RWA, which was reaffirmed by OSFI on June 26, 2025, but can range from 0.0% to 4.0% of RWA. Additionally, banks need to hold an incremental countercyclical capital buffer equal to their weighted-average buffer requirement in Canada and across certain other jurisdictions where they have private sector credit exposures. In addition, the Basel III capital standards include a non-risk-based capital metric, the leverage ratio, to supplement risk-based capital requirements. The leverage ratio is defined as Tier 1 capital divided by the leverage ratio exposure. The leverage ratio exposure is defined under the standards as the sum of: (i) On-balance sheet assets less Tier 1 capital regulatory adjustments; (ii) Derivative exposures; (iii) Securities financing transaction exposures; and (iv) Off-balance sheet exposures (such as commitments, direct credit substitutes, letters of credit, and securitization exposures). Under OSFI's TLAC guideline, D-SIBs are required to maintain a supervisory target TLAC ratio (which builds on the risk-based capital ratios) and a minimum TLAC leverage ratio (which builds on the leverage ratio). TLAC is defined as the aggregate of total capital and other TLAC instruments primarily comprised of bail-in eligible instruments with a residual maturity greater than 365 days. TLAC is required to ensure that a non-viable D-SIB has sufficient loss absorbing capacity to support its recapitalization. This would, in turn, facilitate an orderly resolution of the D-SIB while minimizing adverse impacts on the financial sector stability and taxpayers. OSFI's current regulatory capital and TLAC targets are summarized below. Targets may be higher for certain institutions at OSFI's discretion. We are in compliance with all current capital, leverage and TLAC requirements imposed by OSFI. | As at October 31, 2025 | Minimum | Capital conservation buffer | D-SIB buffer | Pillar 1 targets $^{(1)}$ | Domestic Stability Buffer | Target including all buffer requirements | |---|---|---|---|---|---|---| | CET1 ratio | 4.5% | 2.5% | 1.0% | 8.0% | 3.5% | 11.5% | | Tier 1 capital ratio | 6.0% | 2.5% | 1.0% | 9.5% | 3.5% | 13.0% | | Total capital ratio | 8.0% | 2.5% | 1.0% | 11.5% | 3.5% | 15.0% | | Leverage ratio | 3.0% | n/a | 0.5% | 3.5% | n/a | 3.5% | | TLAC ratio | 18.0% | 2.5% | 1.0% | 21.5% | 3.5% | 25.0% | | TLAC leverage ratio | 6.75% | n/a | 0.5% | 7.25% | n/a | 7.25% | $^{(1)}$ The countercyclical capital buffer applicable to CIBC is insignificant as at October 31, 2025. n/a Not applicable. Capital adequacy requirements are applied on a consolidated basis consistent with our financial statements, except for our insurance subsidiaries (CIBC Cayman Reinsurance Limited and CIBC Life Insurance Company Limited), which are excluded from the regulatory scope of consolidation. The basis of consolidation applied to our financial statements is described in Note 1 to the consolidated financial statements. CIBC Life Insurance Company Limited is subject to OSFI's Life Insurance Capital Adequacy Test. 33 CIBC 2025 ANNUAL REPORT ## Risk-weighted assets The following table provides a summary of permissible regulatory capital approaches and those adopted by CIBC: | Risk category | Permissible regulatory capital approaches | Approach adopted by CIBC | |---|---|---| | Credit risk$^{(1)}$ | Basel provides three approaches for calculating credit risk capital requirements: Standardized approach (SA), Foundation internal ratings-based (FIRB), Advanced internal ratings-based (AIRB). OSFI expects financial institutions in Canada with Total capital in excess of \$5 billion to use the internal ratings-based (IRB) approach for all material portfolios and credit businesses. OSFI provides two approaches for calculating counterparty credit risk (CCR) for derivatives transactions: Standardized approach (SA-CCR), Internal model method (IMM). OSFI provides four approaches for calculating CCR for repo-style transactions: Comprehensive approach, with supervisory haircuts; Comprehensive approach, with own estimate haircuts; Repo VaR approach; IMM. Permitted approaches for equity positions in the banking book (which includes equity investments in funds) include: Standardized, Market-based, Look-through, Mandate-based, Fall-back. Basel provides the following approaches for calculating capital requirements for securitization positions: Internal ratings-based approach (SEC-IRBA), Internal assessment approach (SEC-IAA), External ratings-based approach (SEC-ERBA), Standardized approach (SEC-SA). | We have adopted the IRB (FIRB and AIRB) approach for the majority of our credit portfolios. Under this methodology, we utilize our own internal estimates to determine probability of default (PD), and maturity and either regulatory prescribed (FIRB), or internal (AIRB) estimates for loss given default (LGD) and exposure at default (EAD). We utilize the standardized approach for CIBC Caribbean, risk-rated individuals, sovereign wealth funds, the acquired Canadian Costco credit card portfolio, and other small portfolios. We periodically review portfolios under the standardized approach for consideration of adoption of the IRB approach. CIBC applies the IMM approach for calculating CCR exposure for qualifying derivative transactions. Certain transactions are under the SA-CCR approach. The comprehensive approach, with supervisory haircuts, is used for credit risk mitigation for repo-style transactions. We use the standardized approach for equity positions in the banking book and both the look-through and mandate-based approaches for equity investments in funds. We use SEC-IRBA, SEC-IAA, SEC-ERBA and SEC-SA for securitization exposures in the banking book. | | Credit Valuation Adjustments (CVA) risk | CVA risk capital requirements can be calculated under the following approaches: Basic approach (BA-CVA), Standardized approach (SA-CVA). | CIBC applies the standardized approach to calculate CVA risk capital for most of our counterparties and applies the basic approach for a small subset of counterparties. | | Market risk | Market risk capital requirements can be determined under the following approaches: Standardized approach, Internal models approach. | CIBC applies the sensitivity-based standardized approach to calculate market risk capital under the Fundamental Review of the Trading Book (FRTB) rules. | | Operational risk | Operational risk capital requirements can be determined under the following approaches: Standardized approach, Simplified standardized approach (SSA). | We use the standardized approach based on OSFI rules to calculate operational risk capital. | $^{(1)}$ Includes CCR. We also calculate a capital floor by applying a floor adjustment factor to the total RWA determined using standardized approaches. If the capital requirement calculated using internal models is lower than the amount determined by the capital floor, an adjustment to our RWA would be required. The floor adjustment factor is currently set at 67.5%. See "Continuous enhancement to regulatory capital and TLAC requirements" for more details. 34 CIBC 2025 ANNUAL REPORT ## Continuous enhancement to regulatory capital and TLAC requirements We continue to monitor and prepare for developments impacting regulatory capital and TLAC requirements and disclosures. The discussion below provides a summary of BCBS and OSFI publications that have been issued since our 2024 Annual Report. ### OSFI's Capital Adequacy Requirements On September 11, 2025, OSFI published the Capital Adequacy Requirements 2026 guideline ("CAR Guideline") that took effect on November 1, 2025. The guideline enhances clarity across credit, market, and operational risk components. OSFI also confirmed that the floor adjustment factor will remain at 67.5% until further notice, and any change to the floor adjustment factor will be communicated at least two years prior to the effective date. ### Exclusion of operational loss event from operational Risk RWA CIBC received OSFI approval to exclude an operational loss event that was recognized in fiscal 2023 from the operational risk capital calculations. This exclusion of an operational loss event from operational risk RWA will be reflected beginning in the second quarter of 2026, which will add approximately 25 basis points to our CET1 ratio. ## Regulatory capital, leverage and TLAC ratios The components of our regulatory capital and ratios under Basel III are presented in the table below: | \$ millions, as at October 31 | 2025 | 2024 | |---|---|---| | **Common Equity Tier 1 (CET1) capital: instruments and reserves** | | | | Directly issued qualifying common share capital plus related stock surplus | \$ 17,071 | \$ 17,170 | | Retained earnings | 36,471 | 33,471 | | AOCI (and other reserves) $^{(1)}$ | 4,218 | 3,148 | | Common share capital issued by subsidiaries and held by third parties (amount allowed in group CET1) | 123 | 119 | | **CET1 capital before regulatory adjustments** | **57,883** | **53,908** | | **CET1 capital: regulatory adjustments** | | | | Prudential valuation adjustments | 22 | 4 | | Goodwill (net of related tax liabilities) | 5,392 | 5,360 | | Other intangibles other than mortgage-servicing rights (net of related tax liabilities) | 2,490 | 2,456 | | Deferred tax assets excluding those arising from temporary differences (net of related tax liabilities) | 17 | 15 | | Defined benefit pension fund net assets (net of related tax liabilities) | 1,276 | 1,045 | | Other | 968 | 512 | | **Total regulatory adjustments to CET1 capital** | **10,165** | **9,392** | | **CET1 capital** | **47,718** | **44,516** | | **Additional Tier 1 (AT1) capital: instruments** | | | | Directly issued qualifying AT1 instruments plus related stock surplus $^{(1)}$ | 6,369 | 4,946 | | AT1 instruments issued by subsidiaries and held by third parties (amount allowed in AT1) | 18 | 19 | | **AT1 capital** | **6,387** | **4,965** | | **Tier 1 capital (T1 = CET1 + AT1)** | **54,105** | **49,481** | | **Tier 2 capital: instruments and provisions** | | | | Directly issued qualifying Tier 2 instruments plus related stock surplus $^{(2)}$ | 7,325 | 6,920 | | Tier 2 instruments issued by subsidiaries and held by third parties (amount allowed in Tier 2) | 18 | 17 | | Collective allowances | 839 | 391 | | **Tier 2 capital (T2)** | **8,182** | **7,328** | | **Total capital (TC = T1 + T2)** | **\$ 62,287** | **\$ 56,809** | | **RWA consisting of:** | | | | Credit risk | 294,848 | 274,503 | | Market risk | 12,243 | 12,188 | | Operational risk | 50,712 | 46,811 | | **Total RWA** | **\$ 357,803** | **\$ 333,502** | | **Capital ratios** | | | | CET1 ratio | 13.3% | 13.3% | | Tier 1 capital ratio | 15.1% | 14.8% | | Total capital ratio | 17.4% | 17.0% | | Leverage ratios | | | | Leverage ratio exposure | \$ 1,261,098 | \$ 1,155,432 | | Leverage ratio | 4.3% | 4.3% | | **TLAC ratio and TLAC leverage ratio** | | | | TLAC available | \$ 114,102 | \$ 101,062 | | TLAC ratio | 31.9% | 30.3% | | TLAC leverage ratio | 9.0% | 8.7% | $^{(1)}$ Comprised of non-viability contingent capital (NVCC) preferred shares and LRCNs. $^{(2)}$ Comprised of certain debentures which qualify as NVCC. CET1 ratio The CET1 ratio at October 31, 2025 was comparable with October 31, 2024, as an increase in RWA was offset by an increase in CET1 capital. The increase in CET1 capital was mainly due to internal capital generation (net income less dividends and distributions), partially offset by shares repurchased and cancelled under NCIBs. The increase in RWA was due to increases in credit risk and operational risk RWA. The increase in credit risk RWA was mainly due to organic growth, credit migration and foreign currency translation, partially offset by model and methodology updates. The increase in operational risk RWA was due to an increase in risk levels. For additional information, see the "Components of risk-weighted assets" section. 35 CIBC 2025 ANNUAL REPORT Tier 1 capital ratio The Tier 1 capital ratio at October 31, 2025 increased 0.3% from October 31, 2024, primarily due to the factors affecting the CET1 ratio noted above and net issuance of LRCNs and preferred shares. See the "Capital initiatives" section below for further details. Total capital ratio The Total capital ratio at October 31, 2025 increased 0.4% from October 31, 2024, primarily due to the factors affecting the Tier 1 capital ratio noted above, an increase in eligible general allowances included in Tier 2 capital, and net issuance of subordinated debentures. See the "Capital initiatives" section below for further details. Leverage ratio The leverage ratio at October 31, 2025 was comparable with October 31, 2024, primarily due to an increase in Tier 1 capital discussed above, offset by an increase in leverage ratio exposure. The increase in leverage ratio exposure was primarily driven by an increase in on-balance sheet and off-balance sheet exposures. TLAC ratio and TLAC leverage ratio The TLAC ratio at October 31, 2025 increased 1.6% from October 31, 2024, primarily driven by an increase in total TLAC instruments, partially offset by an increase in RWA. The increase in TLAC instruments was primarily a result of higher level of bail-in eligible liabilities and higher total capital due to the factors noted above. The TLAC leverage ratio at October 31, 2025 increased 0.3% from October 31, 2024, primarily due to the increase in TLAC instruments, partially offset by an increase in leverage ratio exposure due to factors noted above. ## Movement in total regulatory capital Changes in regulatory capital under Basel III are presented in the table below: | \$ millions, for the year ended October 31 | 2025 | 2024 | |---|---|---| | **CET1 capital** | | | | Balance at beginning of year | \$ 44,516 | \$ 40,327 | | Shares issued in lieu of cash dividends (add back) | 698 | - | | Other issue of common shares | 168 | 321 | | Purchase of common shares for cancellation | (335) | (90) | | Premium on purchase of common shares for cancellation | (1,396) | (329) | | Dividends and distributions | (3,993) | (3,645) | | Net income attributable to equity shareholders | 8,429 | 7,115 | | Change in AOCI balances | 35 | 14 | | Currency translation differences | 370 | 102 | | Securities measured at FVOCI | 491 | 1,535 | | Cash flow hedges $^{(1)}$ | (34) | (216) | | Fair value change of FVO liabilities attributable to changes in credit risk | 208 | 250 | | Post-employment defined benefit plans | 36 | 314 | | Removal of own credit spread (net of tax) | (66) | (88) | | Goodwill and other intangible assets (deduction, net of related tax liabilities) | (711) | (1,792) | | Shortfall of allowance to expected losses | | | | Other, including regulatory adjustments $^{(1)}$ | \$ 47,718 | \$ 44,516 | | **Balance at end of year** | | | | **AT1 capital** | | | | Balance at beginning of year | \$ 4,965 | \$ 4,943 | | AT1 eligible capital issues | 2,770 | 1,000 | | Redeemed capital | (1,350) | (975) | | Other, including regulatory adjustments | 2 | (3) | | **Balance at end of year** | **\$ 6,387** | **\$ 4,965** | | **Tier 2 capital** | | | | Balance at beginning of year | \$ 7,328 | \$ 6,849 | | New Tier 2 eligible capital issues | 1,250 | 2,250 | | Redeemed capital | (1,000) | (1,500) | | Other, including change in regulatory adjustments | 604 | (271) | | **Balance at end of year** | **\$ 8,182** | **\$ 7,328** | | **Total capital balance at end of year** | **\$ 62,287** | **\$ 56,809** | $^{(1)}$ Net change in cash flow hedges is included in "Change in AOCI balances" then derecognized in "Other, including regulatory adjustments". 36 CIBC 2025 ANNUAL REPORT # Management's discussion and analysis ## Components of risk-weighted assets The components of our RWA and corresponding minimum total capital requirements are presented in the table below: | \$ millions, as at October 31 | 2025 | | 2024 | | |---|---|---|---|---| | | RWA | Minimum total capital required $^{(1)}$ | RWA | Minimum total capital required $^{(1)}$ | | **Credit risk $^{(2)}$** | | | | | | Standardized approach | | | | | | Corporate | \$ 7,474 | \$ 598 | \$ 6,868 | \$ 549 | | Sovereign | 1,316 | 105 | 1,293 | 103 | | Banks | 317 | 25 | 328 | 26 | | Real estate secured personal lending | 1,182 | 95 | 1,139 | 91 | | Commercial real estate | 353 | 28 | 463 | 37 | | Other retail | 3,585 | 287 | 3,607 | 289 | | Trading book | 135 | 11 | 125 | 10 | | Equity | 6,628 | 530 | 3,623 | 290 | | Securitization $^{(3)}$ | 5,443 | 435 | 4,655 | 372 | | Central counterparty (CCP) | 877 | 70 | 684 | 55 | | CVA | 3,057 | 245 | 3,381 | 271 | | Other credit RWA | 12,988 | 1,039 | 15,114 | 1,209 | | **Total credit risk** | **43,355** | **3,468** | **41,280** | **3,302** | | AIRB approach $^{(4)}$ | | | | | | Corporate | 79,028 | 6,322 | 74,100 | 5,928 | | Sovereign $^{(5)}$ | 5,508 | 441 | 5,153 | 412 | | Real estate secured personal lending | 42,338 | 3,387 | 40,328 | 3,226 | | Commercial real estate | 30,762 | 2,461 | 30,003 | 2,400 | | Qualifying revolving retail | 21,533 | 1,723 | 19,749 | 1,580 | | Other retail | 10,805 | 864 | 12,123 | 970 | | Trading book | 1,259 | 101 | 777 | 62 | | Securitization $^{(3)}$ | 6,161 | 493 | 4,580 | 366 | | **Total AIRB** | **197,394** | **15,792** | **186,813** | **14,944** | | FIRB approach $^{(4)}$ | | | | | | Corporate | 44,035 | 3,523 | 38,709 | 3,097 | | Banks | 4,852 | 388 | 3,482 | 279 | | Commercial real estate | 178 | 14 | 198 | 16 | | Trading book | 5,034 | 403 | 4,021 | 322 | | **Total FIRB** | **54,099** | **4,328** | **46,410** | **3,714** | | **Total credit risk** | **294,848** | **23,588** | **274,503** | **21,960** | | **Market risk** | | | | | | Sensitivities-based methodology | 8,791 | 703 | 9,584 | 767 | | Default risk charge | 1,490 | 119 | 1,265 | 101 | | Risk residual add-on | 1,962 | 157 | 1,339 | 107 | | **Total market risk** | **12,243** | **979** | **12,188** | **975** | | **Operational risk** | **50,712** | **4,057** | **46,811** | **3,745** | | **Total RWA** | **\$ 357,803** | **\$ 28,624** | **\$ 333,502** | **\$ 26,680** | $^{(1)}$ Refers to the minimum standard established by the BCBS before the application of the capital conservation buffer and any other capital buffers that may be established by regulators from time to time. It is calculated by multiplying RWA by 8%. $^{(2)}$ Credit risk includes CCR, which comprises derivative and repo-style transactions. Credit risk for CIBC Caribbean are calculated under the standardized approach. $^{(3)}$ Includes securitization exposures that are risk-weighted at 1250%. $^{(4)}$ Includes RWA relating to certain commercial loans which are determined using the supervisory slotting approach. $^{(5)}$ Includes residential mortgages insured by Canada Mortgage and Housing Corporation (CMHC), an agency of the Government of Canada, and government-guaranteed student loans. ## Capital initiatives The following were the main capital initiatives undertaken since our 2024 Annual Report: ### Normal course issuer bid (NCIB) On September 8, 2025, we announced that the Toronto Stock Exchange had accepted the notice of our intention to commence an NCIB. Purchases under this bid will be completed upon the earlier of: (i) CIBC purchasing 20 million common shares; (ii) CIBC providing a notice of termination; or (iii) September 9, 2026. 3,500,000 common shares were purchased and cancelled during the fourth quarter at an average price of \$112.54 for a total amount of \$393 million. The following table shows common shares purchased and cancelled under current and previously expired NCIBs. | \$ millions, except number of shares, as at or for the year ended October 31 | 2025 | | 2024 | | Total | |---|---|---|---|---|---| | **TSX approval date** | **Number of shares** | **Amount** | **Number of shares** | **Amount** | **Number of shares** | **Amount** | | September 5, 2024 $^{(1)}$ | 15,000,000 | \$ 1,338 | 5,000,000 | \$ 419 | 20,000,000 | \$ 1,757 | | September 5, 2025 $^{(2)}$ | 3,500,000 | 393 | | | 3,500,000 | 393 | | **Total** | **18,500,000** | **\$ 1,731** | **5,000,000** | **\$ 419** | **23,500,000** | **\$ 2,150** | $^{(1)}$ Common shares were repurchased at an average price of \$87.80 under this NCIB. $^{(2)}$ Common shares were repurchased at an average price of \$112.54 under this NCIB. 37 CIBC 2025 ANNUAL REPORT ## Shareholder investment plan Commencing with dividends paid on January 28, 2025, and for future dividends declared until further notice, common shares received by participants under the shareholder investment plan were purchased from the open market. For the share purchase option, this change became effective February 1, 2025. ### Dividends On December 3, 2025, the CIBC Board of Directors approved an increase in our quarterly common share dividend from \$0.97 per share to \$1.07 per share for the quarter ending January 31, 2026. Common and preferred share dividends are declared quarterly at the discretion of the Board. The declaration and payment of dividends is governed by Section 79 of the Bank Act (Canada), and the terms of the preferred shares, as explained in Note 15 to the consolidated financial statements. ### Limited Recourse Capital Notes On September 29, 2025, we redeemed all \$750 million of our 4.375% Limited Recourse Capital Notes Series 1 (NVCC) (subordinated indebtedness) (LRCN Series 1 Notes). In connection with the redemption of the Notes, CIBC redeemed all 750,000 Non-Cumulative 5-Year Fixed Rate Reset Class A Preferred Shares Series 53 (Non-Viability Contingent Capital (NVCC)) that are held by Computershare Trust Company of Canada as trustee of CIBC LRCN Limited Recourse Trust. #### Limited Recourse Capital Notes Series 5 (NVCC) (subordinated indebtedness) (LRCN Series 5 Notes) On November 5, 2024, we issued USD\$500 million principal amount of 6.950% LRCN Series 5 Notes. The LRCN Series 5 Notes mature on January 28, 2085, and bear interest at a fixed rate of 6.950% per annum (paid quarterly) until January 28, 2030. Starting on January 28, 2030, and every five years thereafter until January 28, 2080, the interest rate will be reset to the then current five-year U.S. Treasury Rate plus 2.833% per annum. Concurrently with the issuance of the LRCN Series 5 Notes, we issued Non-cumulative 5-Year Fixed Rate Reset Class A Preferred Shares Series 59 (NVCC) (Series 59 Shares), which are held in the Limited Recourse Trust that is consolidated by CIBC and, as a result, the Series 59 Shares are eliminated in CIBC's consolidated financial statements. In the event of non-payment by CIBC of the principal amount of, interest on, or redemption price for, the LRCN Series 5 Notes when due, the sole remedy of each LRCN Series 5 Note holder is limited to that holder's proportionate share of the Series 59 Shares held in the Limited Recourse Trust. Subject to regulatory approval, we may redeem the LRCN Series 5 Notes, in whole or in part, on each January 28, April 28, July 28, and October 28, commencing on January 28, 2030, at par. #### Limited Recourse Capital Notes Series 6 (NVCC) (subordinated indebtedness) (LRCN Series 6 Notes) On March 24, 2025, we issued \$450 million principal amount of 6.369% LRCN Series 6 Notes. The LRCN Series 6 Notes mature on April 28, 2085, and bear interest at a fixed rate of 6.369% per annum (paid semi-annually) until April 28, 2030. Starting on April 28, 2030, and every five years thereafter until April 28, 2080, the interest rate will be reset to be equal to the then current five-year Government of Canada yield plus 3.65% per annum. Concurrently with the issuance of the LRCN Series 6 Notes, we issued Non-cumulative 5-Year Fixed Rate Reset Class A Preferred Shares Series 60 (NVCC) (Series 60 Shares), which are held in the Limited Recourse Trust that is consolidated by CIBC and, as a result, the Series 60 Shares are eliminated in CIBC's consolidated financial statements. In the event of non-payment by CIBC of the principal amount of, interest on, or redemption price for, the LRCN Series 6 Notes when due, the sole remedy of each LRCN Series 6 Note holder is limited to that holder's proportionate share of the Series 60 Shares held in the Limited Recourse Trust. Subject to regulatory approval, we may redeem the LRCN Series 6 Notes, in whole or in part, every five years during the period from March 28 to and including April 28, commencing on March 28, 2030, at par. #### Limited Recourse Capital Notes Series 7 (NVCC) (subordinated indebtedness) (LRCN Series 7 Notes) On July 14, 2025, we issued USD\$750 million principal amount of 7.000% LRCN Series 7 Notes. The LRCN Series 7 Notes mature on October 28, 2085, and bear interest at a fixed rate of 7.000% per annum (paid quarterly) until October 28, 2030. Starting on October 28, 2030, and every five years thereafter until October 28, 2080, the interest rate will be reset to the then current five-year U.S. Treasury Rate plus 3.000% per annum. Concurrently with the issuance of the LRCN Series 7 Notes, we issued Non-cumulative 5-Year Fixed Rate Reset Class A Preferred Shares Series 62 (NVCC) (Series 62 Shares), which are held in the Limited Recourse Trust that is consolidated by CIBC and, as a result, the Series 62 Shares are eliminated in CIBC's consolidated financial statements. In the event of non-payment by CIBC of the principal amount of, interest on, or redemption price for, the LRCN Series 7 Notes when due, the sole remedy of each LRCN Series 7 Note holder is limited to that holder's proportionate share of the Series 62 Shares held in the Limited Recourse Trust. Subject to regulatory approval, we may redeem the LRCN Series 7 Notes, in whole or in part, on each January 28, April 28, July 28, and October 28, commencing on October 28, 2030, at par. #### Limited Recourse Capital Notes Series 8 (NVCC) (subordinated indebtedness) (LRCN Series 8 Notes) On September 29, 2025, we issued \$450 million principal amount of 5.898% LRCN Series 8 Notes. The LRCN Series 8 Notes mature on January 28, 2086, and bear interest at a fixed rate of 5.898% per annum (paid semi-annually) until January 28, 2031. Starting on January 28, 2031, and every five years thereafter until January 28, 2081, the interest rate will be reset to be equal to the then current five-year Government of Canada yield plus 3.113% per annum. Concurrently with the issuance of the LRCN Series 8 Notes, we issued Non-cumulative 5-Year Fixed Rate Reset Class A Preferred Shares Series 63 (NVCC) (Series 63 Shares), which are held in the Limited Recourse Trust that is consolidated by CIBC and, as a result, the Series 63 Shares are eliminated in CIBC's consolidated financial statements. In the event of non-payment by CIBC of the principal amount of, interest on, or redemption price for, the LRCN Series 8 Notes when due, the sole remedy of each LRCN Series 8 Note holder is limited to that holder's proportionate share of the Series 63 Shares held in the Limited Recourse Trust. Subject to regulatory approval, we may redeem the LRCN Series 8 Notes, in whole or in part, every five years during the period from December 28 to and including January 28, commencing on December 28, 2030, at par. 38 CIBC 2025 ANNUAL REPORT ### Preferred shares On January 31, 2025, we redeemed all 12 million Non-cumulative Rate Reset Class A Preferred Shares Series 41 (NVCC) (Series 41 Shares), at a redemption price of \$25.00 per Series 41 Share, for a total redemption cost of \$300 million. On July 31, 2025, we redeemed all 12 million Non-cumulative Rate Reset Class A Preferred Shares Series 43 (NVCC) (Series 43 Shares), at a redemption price of \$25.00 per Series 43 Share, for a total redemption cost of \$300 million. #### Non-cumulative Rate Reset Class A Preferred Shares Series 61 (NVCC) (Series 61 Shares) On March 24, 2025, we issued 150,000 Series 61 Shares with a par value of \$1,000.00 per share, for gross proceeds of \$150 million. For the initial five-year period to April 28, 2030, the Series 61 Shares pay semi-annual cash dividends on the 28th day of April and October in each year, as declared, at a rate of 6.369%. The first dividend, if declared, will be payable on October 28, 2025. On April 28, 2030, and on April 28 every five years thereafter, the dividend rate will reset to be equal to the then current five-year Government of Canada yield plus 3.65%. Subject to regulatory approval and certain provisions of the shares, we may redeem all or any part of the then outstanding Series 61 Shares at par during the period from March 28, 2030 to and including April 28, 2030 and during the period from March 28 to and including April 28 every five years thereafter. See the "Outstanding share data" section below and Note 15 to our consolidated financial statements for further details. ### Subordinated indebtedness On January 31, 2025, we redeemed all US\$38 million of our Floating Rate Subordinated Capital Debentures due 2084. On February 28, 2025, we redeemed all US\$10 million of our Floating Rate Subordinated Capital Debentures due 2085. On April 2, 2025, we issued \$1.25 billion principal amount of 4.15% Debentures due April 2, 2035. The Debentures bear interest at a fixed rate of 4.15% per annum (paid semi-annually) until April 2, 2030, and at Daily Compounded CORRA plus 1.72% per annum (paid quarterly) thereafter until maturity on April 2, 2035. The debentures qualify as Tier 2 capital. On July 21, 2025, we redeemed all \$1.0 billion of our 2.01% Debentures due July 21, 2030. In accordance with their terms, the Debentures were redeemed at 100% of their principal amount, plus accrued and unpaid interest thereon. The debentures qualified as Tier 2 capital. ### Outstanding share data The table below provides a summary of our outstanding shares, NVCC capital instruments, and the maximum number of common shares issuable on conversion/exercise: | \$ millions, except number of shares and per share amounts, as at October 31, 2025 | Shares outstanding | | |---|---|---| | **Common shares** | **Number of shares** | **Amount** | | Treasury shares - common shares $^{(1)}$ | 926,610,598 | \$ 16,842 | | **Preferred shares** | 3,438 | \$ - | | Series 47 (NVCC) | 18,000,000 | 450 | | Series 56 (NVCC) | 600,000 | 600 | | Series 57 (NVCC) | 500,000 | 500 | | Series 61 (NVCC) | 150,000 | 150 | | Treasury shares - preferred shares $^{(1)}$ | (1,223) | (1) | | **Limited recourse capital notes** | | | | 4.000% Limited Recourse Capital Notes Series 2 (NVCC) | n/a | 750 | | 7.150% Limited Recourse Capital Notes Series 3 (NVCC) | n/a | 800 | | 6.987% Limited Recourse Capital Notes Series 4 (NVCC) | n/a | 500 | | 6.950% Limited Recourse Capital Notes Series 5 (NVCC) $^{(2)}$ | n/a | 693 | | 6.369% Limited Recourse Capital Notes Series 6 (NVCC) | n/a | 450 | | 7.000% Limited Recourse Capital Notes Series 7 (NVCC) $^{(2)}$ | n/a | 1,027 | | 5.898% Limited Recourse Capital Notes Series 8 (NVCC) | n/a | 450 | | **Subordinated indebtedness** | | | | 1.96% Debentures due April 21, 2031 (NVCC) | n/a | 1,000 | | 4.20% Debentures due April 7, 2032 (NVCC) | n/a | 1,000 | | 5.33% Debentures due January 20, 2033 (NVCC) | n/a | 1,000 | | 5.35% Debentures due April 20, 2033 (NVCC) | n/a | 750 | | 5.30% Debentures due January 16, 2034 (NVCC) | n/a | 1,250 | | 4.90% Debentures due June 12, 2034 (NVCC) | n/a | 1,000 | | 4.15% Debentures due April 2, 2035 (NVCC) | n/a | 1,250 | | **Stock options outstanding** | **15,521,372** | | $^{(1)}$ A long position in our own shares is shown as a negative number, which reduces the number of shares outstanding. A short position is shown as a positive number, which adds to the number of shares outstanding. See Note 1 to the consolidated financial statements for the accounting policy on treasury shares. $^{(2)}$ For Limited Recourse Capital Notes (LRCNS) - Series 5 and Series 7, the amount represents the Canadian dollar equivalent of the U.S. dollar notional amount. n/a Not applicable. As at November 28, 2025, the number of common shares was 925,492,036, prior to the treasury shares net long position of 64,642. The number of stock options outstanding was 15,423,934. The occurrence of a "Trigger Event" would result in conversion of all of the outstanding NVCC instruments described above into a maximum of approximately 6.9 billion common shares, in aggregate, which would represent a dilution impact of 88% based on the number of CIBC common shares and NVCC instruments outstanding as at October 31, 2025. As described in the CAR Guideline, a Trigger Event occurs when OSFI determines the bank is or is about to become non-viable and, if after conversion of all contingent instruments and consideration of any other relevant factors or circumstances, it is reasonably likely that its viability will be restored or maintained; or if the bank has accepted or agreed to accept a capital injection or equivalent support from a federal or provincial government, without which OSFI would have determined the bank to be non-viable. 39 CIBC 2025 ANNUAL REPORT Upon the occurrence of a Trigger Event, Class A Preferred Shares Series 47, 56, 57 and 61 will be converted into a number of common shares, determined by dividing the par value plus accrued and unpaid interest by the average common share price (as defined in the relevant prospectus supplements) subject to a minimum price of \$2.50 per common share (subject to adjustment in certain events as defined in the relevant prospectus supplements). Series 54, 55, 58, 59, 60, 62 and 63 Preferred Shares held in the Limited Recourse Trust, will automatically and immediately be converted, without the consent of LRCN Note holders, into a variable number of common shares which will be delivered to LRCN Note holders in satisfaction of the principal amount of, and accrued and unpaid interest on, all of the LRCNs. All claims of LRCN Note holders against CIBC under the LRCNs will be extinguished upon receipt of such common shares. The Debentures are convertible into a number of common shares, determined by dividing 150% of the par value plus accrued and unpaid interest by the average common share price (as defined in the relevant prospectus supplement) subject to a minimum price of \$2.50 per common share (subject to adjustment in certain events as defined in the relevant prospectus supplement). In addition to the potential dilution impacts related to the NVCC instruments discussed above, as at October 31, 2025, \$67.0 billion (2024: \$61.1 billion) of our outstanding liabilities were subject to conversion to common shares under the bail-in regime. Under the bail-in regime, there is no fixed and pre-determined contractual conversion ratio for the conversion of the specified eligible shares and liabilities of CIBC that are subject to a bail-in conversion into common shares, nor are there specific requirements regarding whether liabilities subject to a bail-in conversion are converted into common shares of CIBC or any of its affiliates. CDIC determines the timing of the bail-in conversion, the portion of the specified eligible shares and liabilities to be converted and the terms and conditions of the conversion, subject to parameters set out in the bail-in regime. See the "Regulatory capital and total loss absorbing capacity (TLAC) requirements" section for further details. ### Preferred share and other equity instruments rights and privileges See Note 15 to the consolidated financial statements for details on our preferred share and other equity instruments rights and privileges. ## Off-balance sheet arrangements We enter into off-balance sheet arrangements in the normal course of our business. We consolidate all of our sponsored trusts that securitize our own assets. ### Non-consolidated structured entities (SEs) We manage and administer a single-seller conduit and several CIBC-sponsored multi-seller conduits in Canada and the U.S. The multi-seller conduits acquire direct or indirect ownership or security interests in pools of financial assets from our clients and finance the acquisitions by issuing asset-backed commercial paper (ABCP) to investors. The single-seller conduit acquires financial assets and finances these acquisitions through a credit facility provided by a syndicate of financial institutions. The sellers to the conduits may continue to service the assets. The sellers and/or third-party providers are exposed to credit losses realized on these assets, through the provision of over-collateralization or another form of credit enhancement. We provide the multi-seller conduits with commercial paper backstop liquidity facilities. We may also provide securities distribution to multi-seller conduits and to both the single and multi-seller conduits accounting, cash management, and operations services. The liquidity facilities for the managed and administered multi-seller conduits require us to provide funding for ABCP not placed with external investors. We may also purchase ABCP issued by the multi-seller conduits for market-making and for voluntary risk retention purposes. We are required to maintain certain short-term and/or long-term debt ratings with respect to the liquidity facilities that we provide to the sponsored multi-seller conduits in Canada. If we are downgraded below the level specified under the terms of those facilities, we must provide alternative satisfactory liquidity arrangements, such as procuring an alternative liquidity provider that meets the minimum rating requirements. We may also act as the counterparty to derivative contracts entered into by a multi-seller conduit in order to mitigate the interest rate, basis, and currency risk within the conduit. We earn fees for providing services related to the non-consolidated single-seller and multi-seller conduits, such as backstop liquidity facilities, distribution, transaction structuring, and conduit administration. These fees totalled \$227 million in 2025 (2024: \$170 million). All fees earned in respect of activities with the conduits are on a market basis. As at October 31, 2025, the amount of ABCP issued to fund the various asset types in the multi-seller conduits was \$22.6 billion (2024: \$16.7 billion). The estimated weighted-average life of these assets was 2.0 years (2024: 1.6 years). Our holdings of commercial paper issued by the non-consolidated sponsored multi-seller conduits that offer commercial paper to external investors were \$592 million (2024: \$276 million). Our committed backstop liquidity facilities to these conduits were \$31.1 billion (2024: \$23.1 billion). We also provided credit facilities of \$50 million (2024: \$50 million) to these conduits. We participated in a syndicated facility of \$1.0 billion to the single-seller conduit that provides funding to franchisees of a major Canadian retailer, which will mature in March 2028. Our portion of the commitment was \$190 million (2024: \$130 million), of which \$135 million (2024: \$101 million) was funded as at October 31, 2025. We engage one or more of the four major rating agencies, DBRS Limited (Morningstar DBRS), Fitch Ratings Inc. (Fitch), Moody's Investors Service, Inc. (Moody's), and S&P, to opine on the credit ratings of ABCP issued by our sponsored multi-seller conduits. In the event that ratings differ between rating agencies in respect of any direct investments we have in the ABCP or transactions funded in the ABCP conduits, we use the lower rating. We also have investments in and provide loans, liquidity and credit facilities to certain other third-party and CIBC-managed SEs. The on-balance sheet exposure related to these SEs is included in the consolidated financial statements. We provide interim financing for the purpose of purchasing loans during the warehousing phase for future securitization and term senior financing to third-party SEs. As senior lenders, we are repaid by proceeds from the issuance of debt securities to external investors when the securitization closes or by the cash flows from the repayment of the underlying assets held by the SE or alternative financing obtained by the SE from third-party lenders. We purchase credit protection from capital vehicles on certain referenced loan assets, which issue guarantee-linked notes held only by third-party investors. We do not consolidate the capital vehicles and the underlying loan assets remain on the consolidated balance sheet. 41 CIBC 2025 ANNUAL REPORT Our on- and off-balance sheet amounts related to the SEs that are not consolidated are set out in the table below. For additional details on our SEs, see Note 6 to the consolidated financial statements. | \$ millions, as at October 31 | 2025 | | | | 2024 | | | | |---|---|---|---|---|---|---|---|---| | | Cash, investments and loans $^{(1)}$ | Liquidity, credit facilities and commitments | Written credit derivatives $^{(2)}$ | Investments | Cash, investments and loans $^{(1)}$ | Liquidity, credit facilities and commitments | Written credit derivatives $^{(2)}$ | | Single-seller and multi-seller conduits | \$ 727 | \$ 22,197 $^{(3)}$ | \$ - | \$ 377 | \$ 16,637 $^{(3)}$ | \$ - | | Third-party structured vehicles | 7,749 | 2,065 | - | 4,977 | 1,653 | - | | Loan financing | 19,341 | 10,428 | - | 10,640 | 8,526 | - | | Other | 2,038 | 201 | 59 | 1,795 | 255 | 71 | $^{(1)}$ Excludes securities issued by, retained interest in, and derivatives with entities established by CMHC, Federal National Mortgage Association, Federal Home Loan Mortgage Corporation, Government National Mortgage Association, Federal Home Loan Banks, Federal Farm Credit Bank, and Student Loan Marketing Association. $^{(2)}$ Disclosed amounts reflect the outstanding notional of written credit derivatives. The negative fair value recorded on the consolidated balance sheet was \$41 million (2024: \$50 million). Notional of \$53 million (2024: \$66 million) was hedged with credit derivatives protection from third parties. The fair value of these hedges net of CVA was \$35 million (2024: \$44 million). An additional notional of \$6 million (2024: \$6 million) was hedged through a limited recourse note. $^{(3)}$ Excludes an additional \$8.4 billion (2024: \$6.2 billion) relating to our backstop liquidity facilities provided to the multi-seller conduits as part of their commitment to fund purchases of additional assets. Also excludes \$592 million (2024: \$276 million) of our direct investments in the multi-seller conduits which we consider investment exposure. ### Other financial transactions We are the sponsor of several mutual and pooled funds, in the form of trusts. We are the administrator of these funds. In addition, we may act in other capacities, including custodian, trustee and broker. We earn fees at market rates from these trusts. We do not guarantee either principal or returns to investors in these funds. We act as a trustee of a number of personal trusts and have a fiduciary responsibility to act in the best interests of the beneficiaries of the trusts. We earn a fee for acting as a trustee. We also participate in transactions to modify the cash flows of trusts managed by third-party asset managers to create investments with specific risk profiles, or to assist clients in the efficient management of other risks. Typically, these involve the use of derivative products, which transfer the risks and returns to or from a trust. ### Derivatives We participate in derivatives transactions, as a market maker facilitating the needs of our clients or as a principal to manage the risks associated with our funding, investing and trading strategies. All derivatives are recorded at fair value on our consolidated balance sheet. See Notes 12 and 22 to the consolidated financial statements for details on derivative contracts and the risks associated with them. ### Credit-related arrangements Credit-related arrangements are generally off-balance sheet instruments and are typically entered into to meet the financing needs of clients. In addition, there are certain exposures for which we could be obligated to extend credit that are not recorded on the consolidated balance sheet. For additional details of these arrangements, see the "Liquidity risk" section and Note 20 to the consolidated financial statements. ### Guarantees A guarantee is a contract that requires the issuer to make specified payments to reimburse the holder for a loss it incurs because a specified debtor failed to make payment when due in accordance with the original or modified terms of a debt instrument. Guarantees include credit derivatives protection sold and standby and performance letters of credit, as discussed in Notes 12 and 20 to the consolidated financial statements, respectively. 41 CIBC 2025 ANNUAL REPORT # Management of risk We have provided certain disclosures required under IFRS 7 "Financial Instruments - Disclosures" (IFRS 7) related to the nature and extent of risks arising from financial instruments in the MD&A, as permitted by that IFRS standard. These disclosures are included in the "Risk overview", "Credit risk", "Market risk", "Liquidity risk", "Operational risk", "Regulatory compliance risk", "Reputation and legal risks" and "Conduct and culture risk" sections. ## 42 Risk overview | | | | |---|---|---| | **43 Risk governance structure** | **55 Process and control** | **68 Non-trading activities** | | **44 Risk management structure** | **56 Risk measurement** | **69 Pension risk** | | **45 Risk management process** | **58 Exposure to credit risk** | **70 Liquidity risk** | | **45 Risk appetite statement** | **60 Credit quality of portfolios** | **70 Governance and management** | | **46 Risk input into performance and compensation** | **63 Loans contractually past due but not impaired** | **70 Policies** | | **47 Risk policies and limits** | **63 Exposure to certain countries and regions** | **71 Risk measurement** | | **48 Risk identification and measurement** | **64 Settlement risk** | **75 Funding** | | **49 Stress testing** | **64 Securitization activities** | **76 Contractual obligations** | | **49 Risk treatment and mitigation** | **65 Market risk** | **77 Other risks** | | **49 Risk monitoring and reporting** | **65 Governance and management** | **77 Strategic risk** | | **50 Top and emerging risks** | **65 Policies** | **77 Operational risk** | | **53 Risks arising from business activities** | **65 Market risk limits** | **81 Environmental and social risk** | | **54 Credit risk** | **65 Process and control** | **81 Regulatory compliance risk** | | **54 Governance and management** | **65 Risk measurement** | **81 Insurance risk** | | **54 Policies** | **66 Trading activities** | **81 Reputation and legal risks** | | **54** | | **81 Conduct and culture risk** | Risk overview CIBC faces a wide variety of risks across all of its areas of business. Identifying and understanding risks and their impact allows CIBC to frame its risk appetite and risk management practices. Defining acceptable levels of risk, and establishing sound principles, policies and practices for managing risks are fundamental to achieving consistent and sustainable long-term performance, while remaining within our risk appetite. Our risk appetite defines tolerance levels for various risks. This is the foundation for our risk management culture and our risk management framework. Our risk management framework includes: * CIBC, SBU, functional group-level and regional risk appetite statements; * Risk frameworks, policies, procedures and limits to align activities with our risk appetite; * Regular risk reports to identify and communicate risk levels; * An independent control framework to identify and test the design and operating effectiveness of our key controls; * Stress testing to consider the potential impact of changes in the business environment on capital, liquidity and earnings; * Proactive consideration of risk mitigation options in order to optimize results; and * Oversight through our risk-focused committees and governance structure. Managing risk is a shared responsibility at CIBC. Business units and risk management professionals work in collaboration to ensure that business strategies and activities are consistent with our risk appetite. CIBC's approach to enterprise-wide risk management aligns with the three lines of defence model: (i) As the first line of defence, CIBC's Management, in SBUs and functional groups, own the risks and are accountable and responsible for identifying and assessing risks inherent in its activities in accordance with the CIBC risk appetite. In addition, Management establishes and maintains controls to mitigate such risks and support operational resilience. Management may include Governance Groups within the business to facilitate the Control Framework, Operational Risk Management and Operational Resilience Framework and other risk-related processes. A Governance Group refers to a group within Business Unit Management (first line of defence) whose focus is to support Management in meeting their governance, risk and control activities. A Governance Group is considered the first line of defence, in conjunction with Business Unit Management. Control Groups, which typically reside within centralized functions, provide subject matter expertise to Business Unit Management and/or implement/maintain enterprise-wide control programs and activities. While Control Groups collaborate with Business Unit Management in identifying and managing risk, they also challenge risk decisions and risk mitigation strategies. (ii) The second line of defence is independent from the first line of defence and provides an enterprise-wide view of specific risk types, guidance and effective challenge to risk and control activities. Risk Management is the primary second line of defence. Risk Management may leverage subject matter expertise of other groups (e.g., third parties or Control Groups) to inform their independent assessments, as appropriate. (iii) As the third line of defence, CIBC's Internal Audit is responsible for providing reasonable assurance to senior management and the Audit Committee of the Board on the effectiveness of CIBC's governance practices, risk management processes, and Internal Control as a part of its risk-based audit plan and in accordance with its mandate as described in the Internal Audit Charter. A strong risk culture and communication between the three lines of defence are important characteristics of effective risk management. 42 CIBC 2025 ANNUAL REPORT We continuously monitor our risk profile against our defined risk appetite and related limits, taking action as needed to maintain an appropriate balance of risk and return. Monitoring our risk profile includes forward-looking analysis of sensitivity to local and global market factors, economic conditions, and geopolitical and regulatory environments that influence our overall risk profile. Regular and transparent risk reporting and discussion at senior management committees facilitates communication of risks and discussion of risk management strategies across the organization. ### Risk governance structure Our risk governance structure is illustrated below: ```mermaid graph TD A[Board of Directors] --> B(Audit Committee); A --> C(Risk Management Committee); A --> D(Management Resources and Compensation Committee); A --> E(Corporate Governance Committee); A --> F(Technology Committee); B & C & D & E & F --> G[Group Executive Leadership Team]; G --> H[Global Asset Liability Committee]; G --> I[Global Risk Committee]; H -- oversight --> A; G -- escalation --> A; G -- culture --> A; G -- framework --> A; H -- oversight --> G; I -- oversight --> G; ``` Board of Directors (the Board): The Board oversees the enterprise-wide risk management program through approval of our risk appetite, Control Framework and supporting risk management policies and limits. The Board accomplishes its mandate through its Audit, Risk Management, Management Resources and Compensation, Corporate Governance, and Technology committees, described below. Audit Committee (AC): The Audit Committee reviews the overall design and operating effectiveness of internal controls and the control environment, including internal controls over financial reporting. The Audit Committee also has oversight of the underlying processes and controls of the ESG disclosures in our Annual Report, Sustainability Report, and other material ESG disclosure documents. Risk Management Committee (RMC): This committee assists the Board in fulfilling its responsibilities for defining CIBC's risk appetite and overseeing CIBC's risk profile and performance against the defined risk appetite. This includes oversight of key frameworks, policies and risk limits related to the identification, measurement and monitoring of CIBC's principal business risks. Management Resources and Compensation Committee (MRCC): This committee is responsible for assisting the Board in its global oversight of CIBC's human capital strategy, including talent and total rewards, and the alignment with CIBC's strategy, risk appetite and controls. Corporate Governance Committee (CGC): This committee is responsible for assisting the Board in fulfilling its corporate governance oversight responsibilities and oversight of the ESG strategy. Technology Committee (TC): This committee is responsible for assisting the Board in fulfilling its responsibilities for overseeing CIBC's technology strategy and ensuring it allows for CIBC's strategic plan and priorities to be carried out. The Group Executive Leadership Team (Group ELT): The Group ELT, led by the CEO and including selected executives reporting directly to the CEO, is responsible for setting business strategy and for monitoring, evaluating and managing risks across CIBC. The Group ELT is supported by the following management governance committees: * **Global Asset Liability Committee (GALCO):** This committee, which comprises members from the Group ELT and senior Treasury, Risk Management and lines of business executives, provides oversight regarding capital management, funding and liquidity management, and asset/liability management (ALM). It also provides strategic direction regarding structural interest rate risk (SIRR) and structural foreign exchange risk postures, approval of funds transfer pricing policies/parameters and approval of wholesale funding plans. * **Global Risk Committee (GRC):** This committee, which comprises selected members of the Group ELT and senior leaders from the lines of business, Risk Management and other functional groups, provides a forum for discussion and oversight of risk appetite, risk profile and risk mitigation strategies. Key activities include reviewing and providing input regarding CIBC's risk appetite statements; monitoring risk profile against risk appetite; reviewing and evaluating business activities in the context of risk appetite; and identifying, reviewing, and advising on current and emerging risk issues and associated mitigation plans. 43 CIBC 2025 ANNUAL REPORT ## Risk management structure The Risk Management group, led by our Chief Risk Officer (CRO), is responsible for setting risk strategies and for providing independent oversight of the businesses. Risk Management works to identify, assess, mitigate, monitor and control risks associated with business activities and strategies, and is responsible for providing an effective challenge to the lines of business. The current structure is illustrated below: ```mermaid graph TD A[Chief Risk Officer] --> B[Risk Appetite Statement and Management Control Metrics]; B --> C[Risk Policies and Limits]; C --> D[Risk Identification, Measurement, Monitoring and Reporting]; D --> E[Effective Challenge as Second Line of Defence]; E --> F[Stress Testing]; F --> G[Risk Treatment and Mitigation]; G -- Monitoring --> H[Monitoring]; G -- Reporting --> J[Reporting]; H --> K[Recovery and Resolution Plans$^{(1)}$]; J --> K; ``` *Risk Management Structure* *A --> L[Europe and Asia-Pacific Risk Management]* *A --> M[Capital Markets Risk Management]* *A --> N[Risk Analytics and Credit Decisioning]* *A --> O[Global Operational and Enterprise Risk Management]* *A --> P[Compliance and Global Regulatory Affairs]* *A --> Q[Enterprise Anti-Money Laundering]* *A --> R[Global Credit Risk Management (including non-U.S. Officers)]* *A --> S[U.S. Risk Management]* $^{(1)}$ For additional information refer to the "Capital management" section. The Risk Management group performs several important activities including: * Developing our risk appetite and associated management control metrics; * Setting risk strategy to manage risks in alignment with our risk appetite and business strategy; * Establishing and communicating risk frameworks, policies, procedures and limits to mitigate risks in alignment with risk strategy; * Measuring, monitoring and reporting on risk levels; * Identifying and assessing emerging and potential strategic risks; * Adjudicating transactions, as applicable; * Reviewing and performing effective challenge on business risk assessments; and * Ensuring compliance with applicable regulatory and anti-money laundering (AML) requirements. The following key groups within Risk Management, independent of the originating businesses, contribute to our management of risk: * **Capital Markets Risk Management (CMRM)** - This group provides independent oversight of the measurement, monitoring and control of market risks (both trading and non-trading), and trading credit risk (also called counterparty credit risk, which includes CVA risk) across CIBC's portfolios, and effective challenge and sound risk management oversight to the treasury, including with respect to liquidity and funding risk management and SIRR management function within CIBC. * **Europe and Asia-Pacific Risk Management** - This group carries out the mandate of CIBC Risk Management at a regional level under the leadership of the Senior Vice-President, Chief Risk Officer, Europe & APAC, with oversight from the Management Committees and CIBC Luxembourg Board. The group provides independent oversight for the identification, management, measurement, monitoring and mitigation of risks in Europe and Asia. * **Risk Analytics and Credit Decisioning** - This group is responsible for the management and oversight of credit risk in the personal and business banking lending portfolios (such as residential mortgages, credit cards, loans/lines of credit, and indirect auto lending), including the development of analytics to optimize credit performance and AML outcomes within CIBC's risk appetite. This group is also responsible for all auto-adjudicated business banking loans. * **Global Operational and Enterprise Risk Management (GOERM)** – This group is responsible for the oversight of all enterprise-wide operational risks globally and will establish and provide an independent risk perspective and ongoing strategic direction for various enterprise risk functions, while providing overall leadership to risk-wide business management and transformation activities. GOERM is responsible for enterprise-wide analysis, including the measuring and monitoring of risk appetite, enterprise-wide stress testing and reporting, environmental risk, risk culture, strategic risk management, allowance for credit loss assessment and reporting, risk models and model quantification, economic and regulatory capital methodologies, as well as risk data management. * **Compliance and Global Regulatory Affairs (CGRA)** - This group is responsible for designing and implementing an effective enterprise-wide framework to manage and mitigate regulatory compliance risk at CIBC, to be executed by CGRA and the other Oversight Functions (as defined in the Regulatory Compliance Management Policy). CGRA also provides oversight of conduct and culture risk, including sales practice risk and effective challenge of compensation plan changes. In addition, the Privacy Office under CGRA manages CIBC's privacy-related risks and supports the protection of the privacy of all CIBC client and employee information. Overall, CGRA is responsible for maintaining strong relationships with our prudential, privacy, and market conduct regulators and acts as a liaison between the regulators and CIBC. 44 CIBC 2025 ANNUAL REPORT * **Enterprise Anti-Money Laundering (Enterprise AML)** - This group is responsible for all aspects of AML, anti-terrorist financing (ATF), and Sanction Programs globally for CIBC and its controlled subsidiaries, including providing advice with respect to, and independent oversight of compliance with, all regulatory requirements relating to AML/ATF and sanctions in all business and functional groups globally. Furthermore, Enterprise AML executes a risk-based approach to deter, detect and report suspected Money Laundering/Terrorist Financing and sanctioned activities, in accordance with the Enterprise AML Framework, Enterprise AML/ATF Policy, Enterprise Sanctions Policy, and their supporting standards. * **Global Credit Risk Management** - This group is responsible for the adjudication and oversight of credit risks associated with CIBC's business banking (manually adjudicated loans only), commercial, corporate, and wealth management credit portfolios, management of the risks in the bank's investment portfolios, as well as management of special loan portfolios. Effective for the first quarter of 2026, Global Credit Risk was reorganized into Corporate and Private Credit Risk, which includes trading credit risk, and Commercial and Wealth Credit Risk, which includes global special loans. * **U.S. Risk Management** - This group carries out the mandate of CIBC Risk Management at a regional level under the leadership of the U.S. CRO, with oversight from the Risk Management Committee of the CIBC Board and the Risk Committees of the Boards of CIBC Bank USA and CIBC Bancorp USA Inc. (CIBC Bancorp). The group proactively identifies, assesses, and monitors risks across our U.S. operations, ensuring robust controls and timely mitigation strategies. Through diligent risk oversight, the team enables strong and risk-controlled execution of our business strategy while safeguarding the bank's financial strength and reputation. ### Risk management process Our risk management process is illustrated below: ```mermaid graph TD A[Risk Appetite Statement] --> B[Risk Policies & Limits]; B --> C[Risk Identification and Measurement]; C --> D[Stress Testing]; D --> E[Risk Treatment / Mitigation]; E -- Monitoring --> F[Monitoring]; E -- Reporting --> G[Reporting]; F --> H[Recovery and Resolution Plans$^{(1)}$]; G --> H; ``` ### Risk appetite statement Our risk appetite statement defines the amount of risk we are willing to assume, or to avoid, in pursuit of our strategic and financial objectives. Our guiding principle is to practice sound risk management, supported by strong capital and funding positions, as we pursue our client-focused strategy. In defining our risk appetite, we take into consideration our purpose, vision, values, strategy and objectives, along with our risk capacity (defined by regulatory constraints). Our risk appetite statement defines how we conduct business, which is to be consistent with the following objectives: * Safeguarding our reputation and brand; * Doing the right thing for our clients/stakeholders; * Engaging in client-oriented businesses after understanding the potential risks and rewards; * Making our client's goals our own in a professional and radically simple manner; * Managing a balance between risk and returns; * Retaining a prudent attitude towards tail and event risk; * Meeting regulatory expectations and/or identifying and having plans in place to address any issues in a timely manner; * Achieving/maintaining an AA rating; and * Meeting our expectations with respect to our sustainability priorities. Our risk appetite statement contains metrics with limits that define our risk tolerance levels. In addition, we have SBU, functional group and regional risk appetite statements that are integrated with our overall risk appetite statement and further articulate our business level risk tolerances. Our risk appetite statement is reviewed annually in conjunction with our strategic, financial and capital planning cycle to ensure alignment and is approved annually by the Board. To help drive strong oversight and governance around our risk appetite, the Board, RMC and senior management regularly receive and review reporting on our risk profile against the risk appetite limits. All strategic business decisions, as well as day-to-day business decisions, are governed by our risk appetite framework. Strategic decisions are evaluated to ensure that the risk exposure is within our risk appetite. Day-to-day activities and decisions are governed by our framework of risk tolerance limits, policies, standards and procedures that support our risk appetite statement. 45 CIBC 2025 ANNUAL REPORT ### Risk culture Risk culture refers to desired attitudes and behaviours relative to risk management practices. At CIBC, we strive to achieve a consistent and effective risk culture by: * Promoting, through both formal and informal channels, a shared accountability of risk identification, management and mitigation; * Cultivating an environment of transparency and effective challenge, open communication and robust discussion of risk; * Setting the appropriate "tone at the top" and "tone from the middle" through clear communication and reinforcement; and * Identifying and reinforcing behaviours that are aligned with risk appetite, and reporting and addressing misaligned behaviours. Every year, all employees are required to complete formal training on risk appetite, reputation risk, operational risk, code of conduct, AML and other key risk topics. By taking this mandatory training, all employees strengthen their basic knowledge of risk management in support of our risk culture. This training is supplemented by our risk appetite statement, risk management priorities and documents on our internal website. In addition, we have policies, procedures and limits in place that govern our day-to-day business activity, with escalation procedures for limit breaches outlined accordingly. ### Risk input into performance and compensation Throughout the year, the Risk Management team manages various compensation risk reviews. These reviews are part of the second line of defence responsibilities to review and challenge new compensation plans, changes to existing compensation plans and compensation plan closure. In addition, periodic risk reviews are completed to ensure all compensation plans are risk assessed on a regular basis. All compensation plans are rated as either high-risk or low-risk with high-risk compensation plans requiring approval from the CRO. At each year-end, Risk Management provides an assessment of adherence to risk appetite and material risk matters across CIBC. Risk Management also considers a number of risk inputs to identify matters that may directly impact incentive pools and/or individual compensation awards and/or performance ratings. Annually, Risk Management reviews the assessment with both the RMC and the MRCC. The MRCC oversees the performance management and compensation process and is responsible for assisting the Board of Directors in their global oversight of CIBC's human capital strategy, including talent and total rewards, and the alignment with CIBC's strategy, risk appetite and controls. The MRCC's oversight of human capital strategy includes inclusion at work, employee health, safety and wellbeing and other ESG practices related to their mandate. The MRCC's key compensation-related responsibilities include: * Reviewing and recommending for Board approval annual performance and compensation, including changes to compensation targets, if any, for the CEO, Senior Management, and Heads of Oversight Functions; * Approving annual compensation for any employee whose total direct compensation exceeds the materiality threshold determined by the Committee; * Assessing the appropriateness of compensation based on business performance and risks undertaken; * Reviewing and recommending for Board approval the aggregate annual incentive compensation and allocations to the SBUs and the functional groups; * Approving CIBC's compensation philosophy and any material changes to CIBC's compensation principles or practices; * Reviewing material compensation policies and approving any material changes to such policies or any new material compensation policies; * Reviewing and recommending Board approval of new material compensation plans and changes to existing material compensation plans; and * Reviewing a report on non-material plans. 46 CIBC 2025 ANNUAL REPORT ## Risk policies and limits Our risk frameworks, policies and limits are intended to ensure that risks are appropriately identified, measured, monitored and controlled in accordance with our risk appetite. For most risks, we have developed an overarching framework document that sets out the key principles for managing the associated risks and our key risk policies and limits. This framework is supported by standards, guidelines, processes, procedures and controls that govern day-to-day activities in our businesses. Oversight is provided by management committees, as well as the Board/Board committees. Key risk policies and management committees are illustrated below: | Risk | Supporting Frameworks / Policies | Supporting Limits | Management Oversight | |---|---|---|---| | Credit | Credit Risk Management Policy, Expected Credit Loss Policy, Investment and Lending Authority, Residential Mortgage Underwriting Policy, Trading Credit Risk Management Policy | Common Risk / Concentration Risk Limits for Credit Exposures, Portfolio Concentration Limits for Credit Exposures, Risk Appetite Statement | Credit Committee, Personal and Business Banking Credit Risk Committee, Global Risk Committee | | Market | Market Risk Management Policy, Structural Interest Rate Risk Management Policy, Structural Foreign Exchange Risk Management Policy, Pledging Policy | Market Risk Limits, Risk Appetite Statement | Traded Risk Committee, Global Risk Committee, Global Asset Liability Committee | | Liquidity | Liquidity Risk Management Policy, Pledging Policy | Liquidity Limits, Funding Limits, Pledging Limits, Risk Appetite Statement | Traded Risk Committee, Global Risk Committee, Global Asset Liability Committee | | Operational | Operational Risk Management and Operational Resilience Framework, Business Continuity Management Policy, Code of Conduct, Control Framework, Control and Deficiency Management Policy, Conduct and Culture Risk Framework, Data Lifecycle Management Policy, Financial Accounting and Reporting Policy, Fraud Management Policy, Information/Cyber Security Risk Policy, Integrity and Security Framework, Model Risk and Validation Policy, Project, Program and Portfolio Management Policy, Risk Data Management and Reporting Policy, Technology Risk Management Policy, Third Party Risk Management Policy | Key Risk Indicators, Risk Appetite Statement | Operational Risk, Resilience and Control Committee, Global Risk Committee, Technology Operational Risk Committee, Model and Parameter Risk Committee, Cyber Security Committee, Traded Risk Committee, Third Party Risk Council, Executive Fraud Risk Council, Operational Resilience Enterprise Steering Committee | | Reputation | Global Reputation Risk Management Framework, Global Reputation and Legal Risks Policy | Key Risk Indicators, Risk Appetite Statement | Reputation and Legal Risks Committee, Global Risk Committee | | Regulatory Compliance | Regulatory Compliance Management Policy, Anti-Bribery and Anti-Corruption Policy, Enterprise Anti-Money Laundering, Anti-Terrorist Financing and Sanctions Framework, Enterprise Anti-money Laundering and Anti-Terrorist Financing Policy, Enterprise Sanctions Policy, Compliance Risk Management Framework, Privacy Management Framework, Global Privacy Policy | Key Risk Indicators, Risk Appetite Statement | Executive Oversight Committee | | Other | Corporate Environmental Policy, Environmental and Social Framework, Insurance/Re-insurance Risk Management Policy, Capital Policy, Economic Capital Policy, Enterprise-wide Stress Testing Policy | Risk Appetite Statement | Group Executive Leadership Team, Global Risk Committee | 47 CIBC 2025 ANNUAL REPORT ## Risk identification and measurement Risk identification and measurement are important elements of CIBC's risk management framework. Risk identification is a continuous process, generally achieved through: * Regular assessment of risks associated with lending and trading credit exposures; * Ongoing monitoring of trading and non-trading portfolios; * Assessment of risks in new business activities and processes; * Assessment of risks in complex and unusual business transactions; * Regular monitoring of the overall risk profile considering market developments and trends, and external and internal events; and * Ongoing monitoring of management operations and processes. Risk Management maintains a "Risk Register" to list all material risks facing CIBC. The inventory is based on the risks inherent and emerging risks in our businesses and updated through various processes, illustrated in the following chart, to reflect changes in the nature of the risks we are facing. The Risk Register is used to support our ICAAP, either explicitly in the economic and regulatory capital calculations, or implicitly through the buffer of actual capital over economic capital and regulatory capital. ```mermaid graph TD A[Risk Identification Processes] --> B[Risk Register]; B --> C[Internal Capital Adequacy Assessment Process (ICAAP)]; A --> D1[Strategic and Emerging Risk Themes, External and Peer Benchmarking, Regulatory Reviews]; A --> D2[Macro and External Risks]; A --> D3[Assessment of Risk Level (probability / severity considerations)]; A --> D4[Risks Inherent in CIBC's Businesses]; A --> D5[Strategic Business Reviews, Change Initiative Risk Assessment Process, Risk and Control Self Assessments]; ``` The decision to register a new risk is based on its risk assessment through our risk identification processes and includes criteria such as severity, measurability and probability. Furthermore, the decision on the amount of capital allocated to cover the new risk brought on the books will take into consideration the effectiveness and impact of the risk mitigants available. We have enterprise-wide methodologies, models and techniques in place to measure both the quantitative and qualitative aspects of risks, appropriate for the various types of risks we face. These methodologies, models and techniques are subject to independent assessment and review to ensure that the underlying logic remains sound, that model risks have been identified and managed, that use of the models continues to be appropriate and outputs are valid. Risk is usually measured in terms of expected loss and unexpected loss. ### Expected loss Expected loss represents the loss that is statistically expected to occur in the normal course of business, with adjustments for conservatism, in a given period of time. In respect of credit risk, the parameters used to measure expected loss are PD, LGD and EAD. These parameters are updated regularly and are based either on our historical experience through the cycle and benchmarking of credit exposures or as prescribed by our regulators as applicable. Unlike the PD, LGD and EAD parameters used for calculating ECL on our consolidated financial statements, the PD, LGD and EAD parameters used for regulatory capital purposes are not adjusted for forward-looking information. For trading market risks, VaR is a statistical technique used to measure risk. VaR is an estimate of the loss in market value for a given level of confidence that we would expect to incur in our trading portfolio due to an adverse one-day movement in market rates, implied volatility and prices using the most recent 500 trading days. We also use stressed VaR to estimate an expected loss over a 10-day holding period and using a one-year historical window when relevant market factors were in distress. For trading credit risks associated with market value based products including CVA, we use models to estimate exposure relative to the value of the portfolio of trades with each counterparty, giving consideration to market rates and prices. ### Unexpected loss Unexpected loss is the statistical estimate of the amount by which actual losses might exceed expected losses over a specified time horizon, computed at a given confidence level. We use regulatory and economic capital to estimate the level of capital needed to protect us against unexpected losses. We also use techniques such as sensitivity analysis and stress testing to help ensure that the risks remain within our risk appetite and that our capital is adequate to cover those risks. Our stress testing program includes evaluation of the potential effects of various economic and market scenarios on our risk profile, earnings and capital. Refer to the "Capital management" section for additional details. 48 CIBC 2025 ANNUAL REPORT ## Model risk management Model risk management encompasses sound development, independent validation, and ongoing monitoring and review of the models as well as governance and controls that are proportionate to the risks. Our model inventory includes, but is not limited to, models that relate to risk measurement (including economic and regulatory capital), pricing, mark-to-market (MTM), credit risk rating and scoring models, credit models for the calculation of loss severity and stress testing models for the calculation of ECL under IFRS 9, and AI and Machine Learning (ML) models. CIBC's approach to provide effective governance and oversight for model risk management comprises the following key elements: * Governance and oversight by management committees, including the Model and Parameter Risk Committee (MPRC), senior management and the Board; * Policies, standards and procedures to outline applicable roles and responsibilities of the various oversight groups and to provide guidance to identify, measure, control and monitor model risk throughout the model's life cycle; and * Controls for key operational aspects of model risk management including maintaining a model inventory, model risk ranking, model risk attestation and ongoing monitoring and reporting. The MPRC is a subcommittee of the Operational Risk, Resilience and Control Committee (ORRCC) and is responsible for providing oversight of CIBC's regulatory, economic capital, credit scoring, reserving, and stress testing models and parameters for credit, market and operational risks. The MPRC has accountability and responsibility for model and parameter approvals, parameter performance monitoring, validation oversight, and policy oversight. ### Model risk mitigation policies We have policies, standards, procedures and controls to ensure effective model risk management for CIBC. A model review and validation is the independent effective challenge that documents the model risk and ensures models are sound and we can rely on their output. The model review and validation process includes: * Review of model documentation; * Comprehensive, systematic testing of key model parameters on implementation to ensure results are as expected; * Review data quality, ensuring that data used in the model is complete and representative for the intended purpose; * Replication of the risk quantification process to determine whether the model implementation is faithful to the model specifications; * Review of whether the model/parameter concepts and assumptions are appropriate and robust; * Accuracy testing to assess the calibration and accuracy of the risk components including, for example, the discriminative power of rating systems and the reasonableness of capital parameters; * Sensitivity testing to analyze the sensitivity of model/parameter outputs to model/parameter assumptions and key inputs; * Scenario and stress testing of the model outputs to key inputs; * Back-testing by comparing actual results with model-generated risk measures; * Benchmarking to other models and comparable internal and external data; * Review of the internal usage of the model/parameter applications to ensure consistency of application; * Reporting of model status to the MPRC, supported through an up-to-date inventory of regulatory models and parameters; * A quarterly attestation process for model owners in order to ensure compliance with the Model Risk and Validation Policy; and * A comprehensive validation report that identifies the conditions for valid application of the model and summarizes these findings to the model owners, developers and users. Once a model has been approved for use, ongoing monitoring becomes a joint responsibility of model users, owners and validators. ### Stress testing Stress testing supplements our other risk management tools by providing an estimate of the potential impacts of plausible but stressed economic scenarios and risk factors. Results of stress testing are interpreted in the context of our risk appetite, including metrics for capital adequacy. Enterprise-wide stress testing, capital planning and financial planning processes are integrated for a comprehensive information system. See the "Capital management" section for detailed discussion on our enterprise-wide stress testing. ### Risk treatment and mitigation Risk treatment and mitigation is the implementation of options for modifying risk levels. We pursue risk mitigation options in order to control our risk profile in the context of our risk appetite. Our objective is to proactively consider risk mitigation options in order to optimize results. Discussions regarding potential risk mitigation strategies are held between Risk Management and the lines of business, at the GRC or GALCO and at the RMC for governance and oversight, as appropriate. In evaluating possible strategies, considerations include costs and benefits, residual risks (i.e., risks that are retained), secondary risks (i.e., those caused by the risk mitigation actions), and appropriate monitoring and review to track results. ### Risk controls Our risk management framework also includes a comprehensive set of risk controls, designed to ensure that risks are being appropriately identified and managed. Our risk controls are part of CIBC's overall Control Framework, developed based on the Committee of Sponsoring Organizations of the Treadway Commission's (COSO) widely accepted "Internal Control - Integrated Framework". The Control Framework also draws on elements of the OSFI Supervisory Framework and Corporate Governance Guidelines. The Board, primarily through the RMC, approves certain credit risk limits and delegates specific transactional approval authorities to the CEO or jointly to the CEO and CRO. The RMC must approve transactions that exceed delegated authorities. Delegation of authority to business units is controlled to ensure decision-making authorities are restricted to those individuals with the necessary experience levels. In addition, CIBC has rigorous processes to identify, evaluate and remediate risk control deficiencies in a timely manner. Regular reporting is provided to the RMC to evidence compliance with risk limits. Risk limits and the delegation of authority to the CEO or jointly to the CEO and CRO are reviewed annually by the RMC. ### Risk monitoring and reporting To monitor CIBC's risk profile and facilitate evaluation against the risk appetite statement, a number of measurement metrics have been established, with regular reporting against these metrics provided to the GRC and the RMC. This reporting enables decisions on growth and risk mitigation strategies. Exposures are also regularly monitored against limits, with escalation protocols for limit excesses, should they occur. Escalation protocols ensure awareness at appropriate levels and facilitate management of excesses that is consistent with our risk appetite. Regular management reports on each risk type are also prepared to facilitate monitoring and control of risk at a more granular level. 49 CIBC 2025 ANNUAL REPORT ## Top and emerging risks We monitor and review top and emerging risks that may affect our future results, and take action to mitigate potential risks. We perform in-depth analyses, which may include stress testing our exposures relative to the risks, and we provide updates and related developments to the Board on a regular basis. Top and emerging risks are those that we consider to have potential negative implications that are material for CIBC. This section describes those top and emerging risks, as well as regulatory and accounting developments that are material for CIBC. ### Trade policy uncertainty Newly implemented and proposed tariffs, by the U.S., and any potential counter-measures, are expected to have negative impacts on supply chains, inflation and economic activity, further amplifying ongoing U.S., Canada, and Mexico trade issues that existed prior to the tariff developments, and is posing recessionary fears and increasing market volatility. Separate trade discussions are ongoing between Canada and China as well as the U.S. and China. The ongoing uncertainty on the ultimate level and extent of tariffs could diminish consumer and business confidence in Canada and around the globe, increasing credit, market, liquidity, strategic and operational (including third-party) risks. The eventual impact of tariffs will depend on their nature and duration, as well as fiscal policies that may be enacted in response, and are expected to drive an increase in unemployment and inflation, thereby elevating credit risks. Higher unemployment and inflation could reduce discretionary consumer spending, slow loan origination and negatively impact debt servicing for both retail and commercial clients. Commercial clients may see lower overall revenues and higher costs, which could, in turn, slow growth and expansion plans. Certain sectors are expected to be more susceptible to the impact of the tariff developments, including but not limited to the manufacturing, retail and wholesale, and transportation sectors. We are also monitoring the financial viability of suppliers who may be impacted should economic conditions deteriorate as the result of global tariff impacts. Global financial markets experienced significant levels of market volatility in the second quarter from increased political and macroeconomic uncertainties driven by tariffs. Concerns around stagflation, with lower growth forecasts and rising inflation expectations, could leave central banks with limited options to manage both inflation and economic growth. Our Capital Markets business maintains a defensive risk posture to manage market risks, while supporting elevated levels of client activity. The impact of macroeconomic uncertainty on the U.S. dollar and long-term bond yields and changes in client sentiment due to macroeconomic volatility, recessionary conditions, or risks associated with banks, could lead to rising liquidity premiums and wider issuance spreads in the funding market. We continue to regularly monitor economic developments and proactively prepare mitigation plans. Further details on tariffs and our economic outlook are provided in the "Economic and market environment - Outlook for calendar year 2026" section. ### Canadian consumer debt and the housing market The latest household debt-to-income ratio data from Statistics Canada continued to remain below 2016 levels due to growth in disposable income and slower debt growth. The debt-to-service ratio stabilized in recent quarters after decreasing to 2017 levels, partially due to interest rate cuts combined with the rise in disposable income. Mortgage debt service ratios remain at historically high levels, while non-mortgage debt-to-income and service ratios remain at historical lows as clients maintain lower utilization and higher payment rates. Mortgage service ratios could remain elevated as mortgages continue to renew at higher rates and income growth decelerates from a slowing labour market. Property sales have slowed in 2025 and are the most recessed levels since 2020. While the interest rate cuts in the second half of 2024 and throughout 2025 will provide some relief, the levels are still high and there is an expected lag on performance relief from each incremental cut. Further interest rate cuts could result in an increase in sales activity and housing prices, however, the risk and uncertainties of the current environment have slowed housing sales, as well as challenged the unemployment and interest rate expectations. Real estate secured lending losses remain low, supported by strong housing prices, and while there was some weakening to the non-seasonally adjusted House Price Index (HPI) in the second and third quarters which was partially reversed in the fourth quarter, the level remains above late 2022 and early 2023. Unemployment rates in fiscal 2025 are at the highest level since 2016 (excluding the increase in 2020 and 2021 resulting from the COVID-19 pandemic) and are expected to slightly improve in fiscal 2026, but remain relatively elevated in the current macroeconomic environment. Unemployment rates at high levels could elevate non-mortgage debt levels, and has increased unsecured payment pressures, typical of the credit cycle. Regulators continue to apply higher levels of scrutiny on guidelines and oversight. Further augmentations to regulatory expectations could impact business processes, increase the cost of compliance, and raise the risk of fines for non-compliance. ### Geopolitical risk The level of geopolitical risk escalates at certain points in time. While the specific impact on the global economy and on global credit and capital markets would depend on the nature of the event, in general, any major event could result in instability and volatility, leading to widening spreads, declining equity valuations, flight to safe-haven currencies and increased purchases of gold. In the short run, market disruption could hurt the net income of our trading and non-trading market risk positions. Geopolitical risk could reduce economic growth, and in combination with the potential impacts on commodity prices and protectionism (further details are provided in the "Economic and market environment - Outlook for calendar year 2026" section), could have serious negative implications for general economic and banking activities. Current areas of concern include: * Conflicts in the Middle East; * The war in Ukraine; and, * Rising civil unrest and activism globally. While it is difficult to predict where new geopolitical disruption will occur, we pay particular attention to markets and regions with existing or recent historical instability to assess the impact of these environments on the markets and businesses in which we operate. ### Climate risk The physical effects of climate change along with regulations designed to mitigate its negative impacts will have a measurable impact on communities and the economy. The physical risks of climate change resulting from severe weather events and systemic issues such as rising sea levels can impact CIBC's profitability through disruptions in our own operations and damage to critical infrastructure. Transition risks, which arise as society adjusts towards a low-carbon future, can impact the financial health of our clients as changes in policy and technology aimed at limiting global warming can increase their operating costs and reduce profitability, while translating into potentially higher credit losses for the bank. We are also exposed to reputational risks due to changing stakeholder expectations related to action or inaction in addressing climate-related risks. In the past year, a number of regulators and standard-setting organizations introduced and updated disclosure frameworks related to climate change risks, as well as environmental and social risks. CIBC 2025 ANNUAL REPORT 50 On April 23, 2025, the Canadian Securities Administrators (CSA) announced it is pausing its work on the development of a new mandatory climate-related disclosure rule in order to support Canadian markets and issuers as they adapt to developments in the U.S. and globally. The CSA will monitor domestic and international regulatory developments with respect to climate disclosures and expects to revisit and finalize requirements for issuers. On March 7, 2025, OSFI published updates to Guideline B-15 on Climate Risk Management (Guideline B-15), postponing scope 3 emissions disclosure from fiscal year-end 2025 to 2028, aligning with the Canadian Sustainability Standards Board Standards' transitional period. OSFI is expected to continue to review Guideline B-15 as practices and standards evolve. Guideline B-15 was initially effective for us for our reporting period ending October 31, 2024 for certain disclosure elements, which were included in our 2024 Climate Report. On June 5, 2025, the Competition Bureau issued updated guidance on environmental claims under Bill C-59, which contains anti-greenwashing amendments to Canada's Competition Act (Act). In addition, the Competition Bureau reaffirmed its previous communication on the private right of action, pursuant to which starting on June 20, 2025, individuals can seek permission to file claims with the Competition Tribunal against businesses under the Act. On October 7, 2023, California enacted climate disclosure laws, Senate Bill (SB) 253 and SB 261. SB 253 requires annual reporting of scope 1 and 2 greenhouse gas emissions in 2026, expanding to scope 3 emissions reporting in 2027. SB 261 requires biennial climate-related financial risk reports, with the first report due by January 1, 2026. On November 18, 2025, the U.S. Court of Appeals for the Ninth Circuit, issued an order temporarily halting the enforcement of SB 261. CIBC is preparing to meet these requirements and will continue to monitor regulatory updates. Additionally, the European Commission adopted the European Sustainability Reporting Standards in 2023 for entities subject to the Corporate Sustainability Reporting Directive. On June 23, 2025, the European Union announced it is negotiating its final position on the Omnibus Proposal II, which is expected to significantly narrow the scope of sustainability reporting for member states. These changes, if adopted, could impact the reporting requirements for CIBC and certain CIBC subsidiaries. Potential divergence among the regulators in disclosure expectations, coupled with the pace at which the regulatory landscape changes, pose operational risks to us. We continue to monitor these developments and evolve our approach to support future regulatory requirements. ### Information and cyber security risk We continue to evolve our use of technology and business processes to improve the client experience and streamline operations. Concurrently, cyber threats are growing in frequency and sophistication, increasing the potential for financial loss, reputational harm, regulatory exposure and business interruption. We actively manage these risks through strategic risk reviews and enterprise-wide technology and information security programs aimed at prevention, detection, response and recovery. Threats include data breaches, malware and ransomware, unauthorized access, social engineering and fraud, and denial-of-service attacks, which may result in damage to CIBC systems and information; theft, loss or disclosure of confidential information; unauthorized or fraudulent activity; and service disruption at CIBC or its service providers, including those that offer cloud services. Given the importance of electronic financial systems, including secure online and mobile banking provided by CIBC to its clients, CIBC monitors the changing environment globally, including cyber threats, mitigation strategies and evolving regulatory requirements, to enhance our controls and processes to protect our systems and client information. In addition, we perform cyber security preparedness, testing, and recovery exercises to validate our defences, benchmark against best practices and provide regular updates to the Board. We have well-defined cyber incident response protocols and playbooks in the event that a security incident or breach occurs. We also have cyber insurance coverage to help mitigate against certain potential losses associated with cyber incidents. Our insurance coverage is subject to various terms and provisions, including limits on the types and amounts of coverage relating to losses arising from cyber incidents. We periodically assess our insurance coverage based on our risk tolerance and limits. Despite our ongoing commitment to information and cyber security, and given the rapidly evolving threat and regulatory landscape, coupled with a changing business environment, it is not possible for us to identify all cyber risks or implement measures that prevent all potential cyber incidents. We monitor our risk profile for changes and continue to refine our protection, detection, response and resilience capabilities to minimize the impact of any cyber incidents that may occur. ### Technology risk We are continuing to evolve our technology services to improve the client experience and streamline operations. New technology solutions offer advanced capabilities, connectivity between systems and efficiencies to support a growing business, while also increasing the complexity of ongoing management and resilience across multiple internal and external stakeholders and platforms hosted on premises, in the cloud or by third parties. Globally, regulators continue to expect financial institutions to have well-designed and managed technology development, deployment, operational and support processes in place to actively manage the risks inherent to a large enterprise technology environment. We continue to manage these risks through our risk management and governance structures that include policies, standards, and risk assessment, measurement and monitoring tools. A robust control environment is in place, focused on developing, delivering and maintaining high-quality, reliable and stable technology solutions that support business needs and enable operations within our risk appetite. ### Disintermediation risk The level of disintermediation risk from fintechs for Canadian financial institutions is generally considered low. Canada has a growing fintech sector, with numerous startups and established tech companies offering digital financial services as alternatives to traditional banking services, such as automated investing, peer-to-peer lending, and financial management tools. Canadian consumers have demonstrated increasing use of digital services, evidenced by high rates of online banking usage. Canada's robust regulatory framework somewhat limits the speed and extent of disruption by fintechs. However, regulations are evolving, and the authorities' increasing openness to fintech innovations and open-banking could heighten disintermediation risks if we do not continue to invest in our digital capabilities. Ease of use is the primary factor we consider when evaluating disintermediation risk from fintechs. With fintechs primarily focused on digital engagement, the risk of clients choosing fintech solutions remains low. Although fintechs have not yet demonstrated success in providing financial advice and wealth management services in Canada, the threat may increase in the future. CIBC's proactivity in adopting new technologies and integrating digital financial services helps to mitigate this risk ### Data and Artificial Intelligence risk Data is being used every day to further advance CIBC's strategic objectives and create competitive advantages. To support this, we continue to invest in our data management and governance capabilities to ensure we have a strong data foundation and business decision making, and grow our analytics and reporting practices to use data as a transformative asset. 51 CIBC 2025 ANNUAL REPORT With rapid advances in technology, we continue to observe growth in applications of AI to drive productivity and competitive enhancements. Alongside the potential benefits of AI tools and technology comes risks; as AI systems make decisions based on data and models, they can inherit or amplify bias or raise concerns about fairness or ethical use. In addition, transparency in AI models is required to ensure the reasoning, accuracy or appropriateness of the output is clearly understood. CIBC has published an AI Framework and has implemented AI governance and risk management practices. From a model risk perspective, OSFI published its final version of Guideline E-23 on Model Risk Management to take effect on May 1, 2027. The revised Guideline E-23 now includes AI and Machine Learning (ML) methodologies in the definition of "model" given the surge in AI/ML analytics. As we navigate the increased adoption of solutions using AI, our approach will remain rooted in ensuring responsible use and ensuring operational risks are mitigated. ### Third-party risk The Board and senior management recognize the establishment of third-party relationships as important to CIBC's business model and therefore leverage them to achieve CIBC's business objectives. With the introduction of new technologies and increasing reliance on sub-contractors, the third-party landscape continues to evolve. While such relationships may benefit us through reduced costs, increased innovation, improved performance and increased business competitiveness, they can also introduce risks of failure or disruption to CIBC through breakdowns in people, processes or technology or through external events that impact these third parties. To mitigate third-party risks, prepare for future third-party risks and changing regulatory expectations, and to ensure existing processes and internal controls are operating effectively, we rely on our strong risk culture and established the Third Party Risk Management program, which includes policies, procedures, expertise and resources dedicated to third-party risk management. The program identifies and manages risks that arise from third-party relationships from the point of planning through the life cycle of the business arrangement and supports the maintenance of collaborative relationships that advance our strategic direction and operational needs within our risk appetite. ### Anti-money laundering, anti-terrorist financing and sanctions Money laundering, terrorist financing, and related crimes threaten the financial sector's stability. CIBC is committed to meeting all AML, ATF, and economic sanctions regulations in every jurisdiction where it operates. As identified in Canada's 2025 National Risk Assessment, banks face significant risks from financial crimes such as drug trafficking, fraud, and crypto-related activities. In response, CIBC invests in robust controls, advanced detection technologies, and comprehensive compliance programs. The bank maintains thorough client due diligence, record keeping, and reporting procedures, and requires annual AML/ATF and sanctions training for all team members. With ongoing regulatory changes expected through 2026, CIBC continuously monitors and enhances its compliance program to address evolving risks and regulatory expectations. ### U.S. banking regulation Our U.S. operations are subject to supervision by the Board of Governors of the Federal Reserve System (Federal Reserve), and are also subject to a comprehensive federal and state regulatory framework. Under the U.S. bank regulatory framework, both CIBC and CIBC Bancorp are expected to provide a source of strength to the subsidiary bank and may be required to commit additional capital and other resources to CIBC Bank USA in the event that its financial condition were to deteriorate, whether due to overall challenging economic conditions in the U.S., or because of business-specific issues. The Federal Reserve (in the case of CIBC Bancorp), and both the Federal Reserve and the Illinois Department of Financial and Professional Regulation (in the case of CIBC Bank USA) also have the ability to restrict dividends paid by CIBC Bancorp or CIBC Bank USA, which could limit our ability to receive distributions on our capital investment in our U.S. banking operations. As our combined U.S. operations grow, we will become subject to additional enhanced prudential standards under the Federal Reserve's regulations applicable to foreign banking organizations. The U.S. regulatory environment continues to evolve and future legislative and regulatory developments may impact CIBC. ### Tax reform The tax environment continues to evolve with the potential for significant tax law changes globally. In the Canadian federal budget, released on November 4, 2025, the government confirmed its intention to proceed with certain amendments to Canada's GMTA, including the "under-taxed profits rule" (UTPR). The U.S. government views the UTPR as an unfair foreign tax and could reinstate proposals for retaliatory tax measures against countries that adopt the UTPR without providing an exception in respect of U.S. persons. We continue to monitor for legislative changes that may impact CIBC and its global operations. See the "Financial performance overview - Taxes" section for further details. ### Corporate transactions CIBC seeks out acquisition and divestiture opportunities that align with its strategy, risk appetite and financial goals. The ability to successfully execute on our strategy to integrate acquisitions, and the ability to anticipate and manage risks associated with such corporate transactions are subject to various factors such as receiving regulatory and shareholder approval on a timely basis and on favourable terms, retaining clients and key personnel, realizing synergies and efficiencies, controlling integration and acquisition costs, and changes in general business and economic conditions, among others. Although many of the factors are beyond our control, their impact is partially mitigated by conducting due diligence before completing the transaction and developing and executing appropriate plans. However, given the inherent uncertainty involved in such corporate transactions, we cannot anticipate all potential events, facts and circumstances that may arise and there could be an adverse impact on our operations and financial performance as a result of such corporate transactions. ### Regulatory developments See the "Taxes", "Capital management", "Credit risk", "Liquidity risk" and "Accounting and control matters" sections for additional information on regulatory developments. ### Accounting developments See the "Accounting and control matters" section and Note 30 to the consolidated financial statements for additional information on accounting developments. 52 CIBC 2025 ANNUAL REPORT ## Risks arising from business activities The chart below shows our business activities and related risk measures based upon regulatory RWA and average allocated common equity as at October 31, 2025: ```mermaid graph LR subgraph CIBC subgraph SBUs A[Canadian Personal and Business Banking] --> B[Business activities: Deposits, Residential mortgages, Personal loans, Credit cards, Business lending, Insurance]; C[Canadian Commercial Banking and Wealth Management] --> D[Business activities: Commercial banking, Full-service brokerage, Asset management, Private wealth management]; E[U.S. Commercial Banking and Wealth Management] --> F[Business activities: Commercial banking, Asset management, Private wealth management, Personal and small business banking]; G[Capital Markets] --> H[Business activities: Corporate banking, Global markets, Investment banking]; I[Corporate and Other] --> J[Business activities: International banking, Investment portfolios, Joint ventures, Functional and support groups (see page 29)]; end subgraph Balance sheet $^{(1)}$ (\$ millions) B --> B1[Avg assets: 339,909, Avg deposits: 248,466]; D --> D1[Avg assets, Avg deposits: 103,855, 116,283]; F --> F1[Avg assets, Avg deposits: 64,415, 58,978]; H --> H1[Avg assets, Avg deposits: 378,541, 103,552]; J --> J1[Avg assets, Avg deposits: 217,565, 269,836]; end subgraph RWA B --> B2[Credit risk: 80,579, Market risk: 20,457, Operational risk: 6,369]; D --> D2[Credit risk: 67,351, Market risk: 8,286, Operational risk: 3,043]; F --> F2[Credit risk$^{(2)}$: 54,474, Market risk: 1, Market risk: 346, Operational risk: 6,369]; H --> H2[Credit risk$^{(3)}$: 72,530, Market risk: 11,896, Operational risk: 6,369]; J --> J2[Credit risk$^{(4)}$: 19,914, Market risk: 346, Operational risk: 12,557]; end subgraph Average allocated common equity $^{(5)}$ (%) B --> B3[Proportion of total: 22, Comprising: Credit risk: 76, Market risk: 12, Operational risk: 19, Other$^{(6)}$: 5]; D --> D3[Proportion of total: 18, Comprising: Credit risk: 79, Market risk: 10, Operational risk: 10, Other$^{(6)}$: 11]; F --> F3[Proportion of total: 19, Comprising: Credit risk: 58, Market risk: 7, Operational risk: 3, Other$^{(6)}$: 32]; H --> H3[Proportion of total: 19, Comprising: Credit risk: 78, Market risk: 39, Operational risk: 7, Other$^{(6)}$: -]; J --> J3[Proportion of total: 22, Comprising: Credit risk: 61, Market risk: 19, Operational risk: 19, Other$^{(6)}$: 18]; end end ``` Risk profile We are exposed to credit, market, liquidity, operational, and other risks, which primarily include strategic, insurance, technology, third-party, fraud, data, AML/ATF, conduct and culture, information and cyber security, reputation and legal, regulatory compliance, and environmental and social risks. $^{(1)}$ Average balances are calculated as a weighted average of daily closing balances. $^{(2)}$ Includes CCR and CVA of \$13 million, which comprises derivatives and repo-style transactions. $^{(3)}$ Includes CCR and CVA of \$15,501 million, which comprises derivatives and repo-style transactions. $^{(4)}$ Includes CCR and CVA of \$637 million, which comprises derivatives and repo-style transactions. $^{(5)}$ Average allocated common equity is a non-GAAP measure. For additional information on the composition of this non-GAAP measure, see the "Non-GAAP measures" section. $^{(6)}$ Represents average allocated common equity relating to capital deductions, such as goodwill and intangible assets, in accordance with the rules in OSFI's CAR Guideline. 53 CIBC 2025 ANNUAL REPORT ## Credit risk Credit risk is the risk of financial loss due to a borrower or counterparty failing to meet its obligations in accordance with contractual terms. Credit risk arises out of the lending businesses in each of our SBUs and in International banking, which is included in Corporate and Other. Other sources of credit risk consist of our trading activities, which include our over-the-counter (OTC) derivatives, debt securities, and our repo-style transaction activity. In addition to losses on the default of a borrower or counterparty, unrealized gains or losses may occur due to changes in the credit spread of the counterparty, which could impact the carrying or fair value of our assets. ### Governance and management Credit risk is managed through the three lines of defence model. The first line of defence consists of the frontline businesses and governance groups that assess and manage the risks associated with their activities. They own the risks and the controls that mitigate the risks. The second line of defence is Risk Management, which provides an independent risk perspective, strategic direction and leadership to ensure alignment of practices with CIBC's risk appetite. This includes being responsible for certain credit decisions and oversight of credit risks associated with CIBC's personal, small business, commercial, corporate and wealth management activities. Internal audit is the third line of defence, providing reasonable assurance to senior management and the Audit Committee of the Board on the effectiveness of CIBC's governance practices, risk management processes, and internal control as part of its risk-based audit plan and in accordance with its mandate as described in the Internal Audit Charter. Senior management reports to the GRC and RMC at least quarterly on material credit risk matters, including compliance with limits, portfolio trends, and credit loss provisioning levels. Senior management also reports to the RMC on material credit transactions and impaired loans. Provision for (reversal of) credit losses is reviewed by the RMC and the Audit Committee quarterly. Specific to the management of credit risk, Risk Management is mandated to provide enterprise-wide oversight of the management of credit risk in CIBC's credit portfolios, including the measurement, monitoring and control of credit risk and the management of credit risk models. Key groups in Risk Management with credit risk responsibility include: * **Capital Markets Risk Management:** This group is responsible for independent oversight of the measurement, monitoring and control of traded and non-traded market risk, liquidity risk and trading credit risk (including CVA risk), including adjudication of trading credit facilities for banks, non-bank financial entities, prime brokerage clients and central clearing counterparties. In addition, CMRM is responsible for the risk management of sovereign and country risk, securitizations and the oversight of the Global Collateral Finance framework covering repos and securities lending. * **Global Credit Risk Management:** This group is responsible for the adjudication and oversight of credit risks associated with our commercial, corporate, small business and wealth management credit portfolios, management of the risks in our investment portfolios, as well as management of special loan portfolios. * **Global Operational and Enterprise Risk Management:** This group includes the following teams: * Model Validation is responsible for the oversight of model validation practices. Model validation constitutes the independent set of processes, activities and ongoing documentary evidence that models and parameters are sound and CIBC can rely on their output. * Model Quantification is responsible for the design, development and continuous improvement to risk rating methodologies and credit models that support credit adjudication and ECL, across corporate commercial, personal and business lending segments. * Enterprise Risk Management is responsible for enterprise-wide reporting and analysis, including enterprise-wide stress testing, ECL, risk data systems and economic capital. * Risk Regulatory Initiatives is responsible for oversight, governance and delivery of regulatory and strategic initiatives and large enterprise-wide regulatory initiatives. * Environmental Risk Management is responsible for developing the environmental strategy, setting environmental performance standards and targets, and reporting on performance for material indicators. * **Risk Analytics and Credit Decisioning:** This group manages credit risk in personal products offered through the various distribution channels (e.g., residential mortgages, credit cards, personal loans/lines of credit, and indirect auto lending) and performs analytics to optimize retail credit performance, along with collections and AML outcomes. * **U.S. Risk Management:** This group carries out the mandate of CIBC Risk Management at a regional level and provides independent oversight of the identification, management, measurement, monitoring and control of credit risks in the U.S. Commercial Banking and Wealth Management SBU. Adjudication and oversight above delegated levels is provided by the CRO, GRC and RMC. ### Policies To control credit risk, prudent credit risk management principles are used as a base to establish policies, standards and guidelines that govern credit activities as outlined by the credit risk management policy. The credit risk management policy supplements CIBC's risk management framework and risk appetite framework, and together with CIBC's portfolio concentration limits for credit exposures, CIBC's common risk/concentration risk limits for credit exposures, and other supporting credit risk policies, standards and procedures, assists CIBC in achieving its desired risk profile by providing an effective foundation for the management of credit risk. ### Credit risk limits The RMC approves Board limits, and exposures above Board limits require reporting to, or approval of, the RMC. Management limits are approved by the CRO. Usage is monitored to ensure risks are within allocated management and Board limits. Exposures above management limits require the approval of the CRO. Business lines may also impose lower limits to reflect the nature of their exposures and target markets. This tiering of limits provides for an appropriate hierarchy of decision making and reporting between management and the RMC. Credit approval authority flows from the Board and is further cascaded to officers in writing. The Board's Investment and Lending Authority Resolution sets thresholds above which credit exposures require reporting to, or approval of, the RMC, ensuring an increasing level of oversight for credit exposures of higher risk. CIBC maintains country limits to control exposures within countries outside of Canada and the U.S. 54 CIBC 2025 ANNUAL REPORT ### Credit concentration limits At a bank-wide level, credit exposures are managed to promote alignment to our risk appetite statement, to maintain the target business mix and to ensure that there is no undue concentration of risk. We set limits to control borrower concentrations by risk-rating band for large exposures (i.e., risk-rated credits). Direct loan sales, credit derivative hedges, or structured transactions may also be used to reduce concentrations. We also have a set of portfolio concentration limits in place to control exposures by country, industry, product and activity. Further, our policies require limits to be established as appropriate for new initiatives and implementation of strategies involving material levels of credit risk. Concentration limits represent the maximum exposure levels we wish to hold on our books. In the normal course, it is expected that exposures will be held at levels below the maximums. The credit concentration limits are reviewed and approved by the RMC at least annually. Credit concentration limits are also applied to our retail lending portfolios to mitigate concentration risk. We not only have concentration limits applied to individual borrowers and geographic regions, but also to different types of credit facilities, such as unsecured credits. In addition, we limit the maximum insured mortgage exposure to private insurers in order to reduce counterparty risk. ### Credit risk mitigation We may mitigate credit risk by obtaining a pledge of collateral, which improves recoveries in the event of a default. Our credit risk management policies include verification of the collateral and its value and ensuring that we have legal certainty with respect to the assets pledged. Valuations are updated periodically depending on the nature of the collateral, legal environment, and the creditworthiness of the counterparty. The main types of collateral include: (i) cash or marketable securities for securities lending and repurchase transactions; (ii) cash or marketable securities taken as collateral in support of our OTC derivatives activity; (iii) charges over operating assets such as inventory, receivables and real estate properties for lending to small business and commercial borrowers; and (iv) mortgages over residential properties for retail lending. In certain circumstances we may use third-party guarantees to mitigate risk. We also obtain insurance to reduce the risk in our real estate secured lending portfolios, the most material of which relates to the portion of our residential mortgage portfolio that is insured by CMHC, an agency of the Government of Canada. We mitigate the trading credit risk of OTC derivatives, securities lending and repurchase transactions with counterparties by employing the International Swaps and Derivatives Association (ISDA) Master Agreement, as well as Credit Support Annexes (CSAs) or similar master and collateral agreements. See Note 12 to the consolidated financial statements for additional details on the risks related to the use of derivatives and how we manage these risks. ISDA Master Agreements and similar master and collateral agreements, such as the Global Master Repurchase Agreement and Global Master Securities Lending Agreement, facilitate cross transaction payments, prescribe close-out netting processes, and define the counterparties' contractual trading relationship. In addition, the agreements formalize non-transaction-specific terms. Master agreements serve to mitigate our credit risk by outlining default and termination events, which enable parties to close out of all outstanding transactions in the case of a negative credit event on either party's side. The mechanism for calculating termination costs in the event of a close-out are outlined in the master agreement; this allows for the efficient calculation of a single net obligation of one party to another. CSAs and other collateral agreements are often included in ISDA Master Agreements or similar master agreements governing securities lending and repurchase transactions. They mitigate CCR by providing for the exchange of collateral between parties when a party's exposure to the other exceeds agreed upon thresholds, subject to a minimum transfer amount. CSAs and other collateral agreements that operate with master agreements also designate acceptable collateral types, and set out rules for re-hypothecation and interest calculation on collateral. Collateral types permitted under CSAs and other master agreements are set through our trading credit risk management documentation procedures. These procedures include requirements around collateral type concentrations. Consistent with global initiatives to improve resilience in the financial system, we clear derivatives through CCPs where feasible. Credit derivatives may be used to reduce industry sector concentrations and single-name exposure. ### Forbearance techniques We employ forbearance techniques to manage client relationships and to minimize credit losses due to default, foreclosure or repossession. In certain circumstances, it may be necessary to modify a loan for reasons related to a borrower's financial difficulties, reducing the potential of default. Total debt restructurings are subject to our normal quarterly impairment review which considers, amongst other factors, covenants and/or payment delinquencies. Loan loss provisions are adjusted as appropriate. In retail lending, forbearance techniques include interest capitalization, amortization amendments and debt consolidations. We have a set of eligibility criteria that allow our Client Account Management team to determine suitable remediation strategies and propose products based on each borrower's situation. The solutions available to corporate and commercial clients vary based on the individual nature of the client's situation and are undertaken selectively where it has been determined that the client has or is likely to have repayment difficulties servicing its obligations. Covenants often reveal changes in the client's financial situation before there is a change in payment behaviour and typically allow for a right to reprice or accelerate payments. Solutions may be temporary in nature or may involve other special management options. ### Process and control The credit approval process is managed by Risk Management and Retail Operations, with all significant credit requests submitted subject to adjudication independent of the originating businesses. Approval authorities are a function of the risk and amount of credit requested. In certain cases, credit requests must be escalated to senior management, the CRO, or to the RMC for approval. After initial approval, individual credit exposures continue to be monitored. A formal risk assessment is completed at least annually for all risk-rated accounts, including review of assigned ratings. Higher risk-rated accounts are subject to closer monitoring and are reviewed at least quarterly. Collections and specialized loan workout groups handle the day-to-day management of high-risk loans to maximize recoveries. 55 CIBC 2025 ANNUAL REPORT ## Risk measurement ### Exposures subject to IRB approaches Under the IRB approaches, we are required to categorize exposures to credit risk into broad classes of assets with different underlying risk characteristics. This asset categorization may differ from the presentation in our consolidated financial statements. Under the IRB approaches, credit risk is measured using the following three key risk parameters$^{(1)}$: * PD – the probability that the obligor will default within the next 12 months. * EAD – the estimate of the amount that will be drawn at the time of default. * LGD – the expected severity of loss as the result of the default, expressed as a percentage of the EAD. Exposures under the IRB approaches can be further differentiated into two categories, AIRB and FIRB. For portfolios subject to the AIRB approach, PD, LGD and EAD are internal estimates. Certain portfolios are prescribed to use the FIRB approach, where LGD and EAD are regulatory defined parameters. Our credit risk exposures are divided into business and government and retail portfolios. Regulatory models used to measure credit risk exposure under the IRB approach are subject to CIBC's model risk management process. $^{(1)}$ These parameters differ from those used in the calculation of ECL under IFRS 9. See the "Accounting and control matters" section for further details. ### Business and government portfolios (excluding scored small business) – risk-rating method The portfolios comprise exposures to corporate, sovereign, and bank obligors. Our adjudication process and criteria includes assigning an obligor rating that reflects our estimate of the financial strength of the borrower, and a facility rating or LGD rating that reflects the collateral amount and quality applicable to secured exposures, the seniority position of the claim, and the capital structure of the borrower for unsecured exposures. The obligor rating takes into consideration our financial assessment of the obligor, the industry, and the economic environment of the region in which the obligor operates. Where a guarantee from a third-party exists, both the obligor and the guarantor will be assessed. While our obligor rating is determined independently of external ratings for the obligor, our risk-rating methodology includes a review of those external ratings. CIBC employs a 20-point master internal obligor default rating scale that broadly maps to external agencies' ratings as presented in the table below. | Grade | CIBC rating | S&P equivalent | Moody's equivalent | |---|---|---|---| | Investment grade | 00-47 | AAA to BBB- | Aaa to Baa3 | | Non-investment grade | 51-67 | BB+ to B- | Ba1 to B3 | | Watch list | 70-80 | CCC+ to C | Caa1 to Ca | | Default | 90 | D | C | We use quantitative modelling techniques to assist in the development of internal risk-rating systems. The risk-rating systems have been developed through analysis of internal and external credit risk data, supplemented with expert judgment. The risk ratings are used for portfolio management, risk limit setting, product pricing, and in the determination of regulatory and economic capital. Our credit process is designed to ensure that we approve applications and extend credit only where we believe that our client has the ability to repay according to the agreed terms and conditions. Our credit framework of policies and limits defines our appetite for exposure to any single name or group of related borrowers, which is a function of the internal risk rating. We generally extend new credit only to borrowers in the investment and non-investment grade categories noted above. Our credit policies are also defined to manage our exposure to concentration in borrowers in any particular industry or region. In accordance with our process, each obligor is assigned an obligor default rating and the assigned rating is mapped to a PD estimate that represents a long-run average one-year default likelihood. For corporate obligors, PD estimates are calculated using joint maximum likelihood techniques based on our internal default rate history by rating category and longer dated external default rates as a proxy for the credit cycle to arrive at long-run average PD estimates. Estimates drawn from third-party statistical default prediction models are used to supplement the internal default data for some rating bands where internal data is sparse. For small and medium corporate enterprises, PD estimates are developed using only internal default history. For bank and sovereign obligors, PD estimates are derived from an analysis based on external default data sets and supplemented with internal data where possible. We examine several different estimation methodologies and compare results across the different techniques. In addition, we apply the same techniques and estimation methodologies to analogous corporate default data and compare the results for banks and sovereigns to the corporate estimates for each technique. A regulatory floor is applied to PD estimates for corporate and bank obligors. Each facility is assigned an LGD rating and each assigned rating is mapped to an LGD estimate that considers economic downturn conditions. For corporate obligors subject to the AIRB approach, LGD estimates are primarily derived from internal historical recovery data. Time to resolution is typically one to two years for most corporate obligors, and one to four years in the real estate sector. LGD values are based on discounted post-default cash flows for resolved accounts and include material direct and indirect costs associated with collections. External data is used in some cases to supplement our analysis. Economic downturn periods are identified for each portfolio by examining the history of actual losses, default rates and LGD. For sovereign exposures, LGD estimates are primarily driven by expert judgment supplemented with external data and benchmarks where available. Appropriate adjustments are made to LGD estimates to account for various uncertainties associated with estimation techniques and data limitations, including adjustments for unresolved accounts. For obligors subjected to the FIRB approach, LGD is a regulatory prescribed calculation. EAD is estimated based on the current exposure to the obligor together with possible future changes in that exposure. For obligors subject to the AIRB approach, internal EAD estimates are driven by factors such as the available undrawn credit commitment amount and the obligor default rating. EAD estimates are primarily based on internal historical loss data supplemented with comparable external data. Economic downturn periods are identified for each portfolio by examining the historical default rates and actual EAD factors. For obligors subjected to the FIRB approach, EAD is a regulatory prescribed calculation. Appropriate adjustments are made to internal PD, LGD and EAD estimates to account for various uncertainties associated with estimation techniques and data limitations, including adjustments for unresolved accounts (for LGD). Regulatory capital slotting approach is used for part of our uninsured Canadian commercial mortgage portfolio, which comprises non-residential mortgages and multi-family residential mortgages. These exposures are individually rated on our rating scale using a risk-rating methodology that considers the property's key attributes, which include its loan-to-value (LTV) and debt service ratios, the quality of the property, and the financial strength of the owner/sponsor. All exposures are secured by a lien over the property. In addition, we have insured multi-family residential mortgages, which are not treated under the slotting approach, but are instead treated as sovereign exposures. 56 CIBC 2025 ANNUAL REPORT ### Retail portfolios Retail portfolios are characterized by a large number of relatively small exposures. They comprise: real estate secured personal lending (residential mortgages and personal loans and lines secured by residential property); qualifying revolving retail exposures (credit cards, overdrafts and unsecured lines of credit); and other retail exposures (loans secured by non-residential assets, unsecured loans, and scored small business loans). We use scoring models in the adjudication of new retail credit exposures, which are based on statistical methods of analyzing the unique characteristics of the borrower, to estimate future behaviour. In developing our models, we use internal historical information from previous borrowers, as well as information from external sources, such as credit bureaus. The use of credit scoring models allows for consistent assessment across borrowers. There are specific guidelines in place for each product, and our adjudication decision will take into account the characteristics of the borrower, any guarantors, and the quality and sufficiency of the collateral pledged (if any). The lending process will include documentation of, where appropriate, satisfactory identification, proof of income, independent appraisal of the collateral and registration of security. Retail portfolios are managed as pools of homogeneous risk exposures, using external credit bureau scores and/or other behavioural assessments to group exposures according to similar credit risk profiles. These pools are established through statistical techniques. Characteristics used to group individual exposures vary by asset category; as a result, the number of pools, their size, and the statistical techniques applied to their management differ accordingly. The following table maps the PD bands to various risk levels: | Risk level | PD bands | |---|---| | Exceptionally low | 0.01%-0.20% | | Very low | 0.21%-0.50% | | Low | 0.51%-2.00% | | Medium | 2.01%-10.00% | | High | 10.01%-99.99% | | Default | 100% | For the purposes of the AIRB approach for retail portfolios, additional PD, LGD and EAD segmentation into homogeneous risk exposures is established through statistical techniques. The principal statistical estimation technique is decision trees benchmarked against alternative techniques such as regression and random forests. Within real estate secured lending, we have two key parameter estimation models: mortgages and real estate secured personal lines of credit. Within qualifying revolving retail, we have three key parameter estimation models: credit cards, overdraft, and unsecured personal lines. A small percentage of credit cards, overdraft, and unsecured line accounts that do not satisfy the requirements for qualifying revolving retail are grouped into other retail parameter models. Within other retail, we have three key parameter models: margin lending, personal loans, and scored small business loans. Each parameter model pools accounts according to characteristics such as: delinquency, current credit bureau score, internal behaviour score, estimated current LTV ratio, account type, account age, utilization, transactor/revolver, outstanding balance, or authorized limit. PD is estimated as the average default rate over an extended period based on internal historical data, generally for a 5-to-10-year period, which is adjusted using internal historical data on default rates over a longer period or comparable external data that includes a period of stress. A regulatory floor is applied to our PD estimate for all retail exposures with the exception of insured mortgages and government-guaranteed loans. A higher regulatory floor is applied to qualifying revolving transactors. LGD is estimated based on observed recovery rates over an extended period using internal historical data. In determining our LGD estimate, we exclude any accounts that have not had enough time since default for the substantial majority of expected recovery to occur. This recovery period is product-specific and is typically in the range of 1 to 3 years. Accounts that cure from default and return to good standing are considered to have zero loss. We simulate the loss rate in a significant downturn based on the relationship(s) between LGD and one or more of the following: PD; housing prices, cure rate, and recovery time; or observed LGD in periods with above-average loss rates. We apply appropriate adjustments to address various types of estimation uncertainty including sampling error and trending. A regulatory floor is applied to all real estate secured exposures with the exception of insured mortgages. Higher regulatory floors are applied to unsecured accounts. EAD for revolving products is estimated as a percentage of the authorized credit limit based on the observed EAD rates over an extended period using historical data. We simulate the EAD rate in a significant downturn based on the relationship(s) between the EAD rate and PD and/or the observed EAD rate in periods with above-average EAD rates. For term loan products, EAD is set equal to the outstanding balance. A regulatory floor is applied to the percentage of the undrawn exposure that is included in EAD. We apply appropriate adjustments to PD, LGD and EAD to address various types of estimation uncertainty including sampling error and trending. ### Back-testing We monitor the three key risk parameters – PD, EAD and LGD - on a quarterly basis for our business and government portfolios and on a monthly basis for our retail portfolios. Every quarter, the back-testing results are reported to OSFI and are presented to the business and Risk Management senior management for review and challenge. For each parameter, we identify any portfolios whose realized values are significantly above or significantly below expectations and then test to see if this deviation is explainable by changes in the economy. If the results indicate that a parameter model may be losing its predictive power, we prioritize that model for review and update. ### Stress testing As part of our regular credit portfolio management process, we conduct stress testing and scenario analyses on our portfolio to quantitatively assess the impact of various historical, as well as hypothetical, stressed conditions, versus limits determined in accordance with our risk appetite. Scenarios are selected to test our exposures to specific industries (e.g., oil and gas and real estate), products (e.g., mortgages and cards), or geographic regions (e.g., Europe and the Caribbean). Results from stress testing are a key input into management decision making, including the