The Globe and Mail

Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Press release from CNW Group

CIBC Announces First Quarter 2013 Results

Thursday, February 28, 2013

CIBC Announces First Quarter 2013 Results05:20 EST Thursday, February 28, 2013TORONTO, Feb. 28, 2013 /CNW/ - CIBC (TSX: CM) (NYSE: CM) reported today net income of $798 million for the first quarter ended January 31, 2013, compared with net income of $835 million for the same period last year and $852 million for the prior quarter. Reported diluted earnings per share (EPS) was $1.91, compared with $1.93 a year ago and $2.02 for the prior quarter.  Return on common shareholders' equity for the first quarter was 19.9%.Excluding items of note listed below, CIBC reported record adjusted net income of $895(1) million for the first quarter, compared with adjusted net income of $833(1) million for the same period last year and $858(1) million for the prior quarter. Adjusted diluted EPS was $2.15(1), compared with adjusted diluted EPS of $1.97(1) a year ago and $2.04(1) for the prior quarter.Results for the first quarter of 2013 were affected by the following items of note netting to a negative impact of $0.24 per share:$148 million ($109 million after-tax or $0.27 per share) loss from the structured credit run-off business, including the charge in respect of a settlement of the U.S. Bankruptcy Court adversary proceeding brought by the Estate of Lehman Brothers Holdings, Inc.;$16 million ($16 million after-tax or $0.04 per share) gain, net of associated expenses, on the sale of our Hong Kong and Singapore-based private wealth management business; and$5 million ($4 million after-tax or $0.01 per share) amortization of intangible assets.Effective January 2013, CIBC adopted the Office of the Superintendent of Financial Institution's (OSFI) revised Capital Adequacy Requirements (CAR) guideline reflecting changes to capital requirements, referred to as Basel III.  As a result of the change in methodology, the regulatory capital information at January 31, 2013 is not comparable to prior periods. CIBC's Basel III Common Equity Tier 1 ratio at January 31, 2013 was 9.6%, and our Tier 1 capital ratio and Total capital ratio were 12.0% and 15.3%, respectively, on an all-in basis."CIBC's solid results in the first quarter reflect our strong focus on our clients as well as our underlying business fundamentals," says Gerald T. McCaughey, President and Chief Executive Officer.  "The broad-based performance across our core businesses reflects our first principle which is to be a lower risk bank delivering consistent, sustainable earnings."Core business performanceRetail and Business Banking reported net income of $611 million for the first quarter, up from $567 million for the same quarter last year.Revenue of $2.1 billion was up 2% from the first quarter of 2012, primarily due to volume growth across most products, higher fees and wider spreads, partially offset by lower treasury allocations.Provision for credit losses of $241 million was down $40 million, or 14%, from the same quarter last year due to lower write-offs and bankruptcies in the cards portfolio.During the first quarter of 2013, our retail and business banking business continued to make progress against our objectives of accelerating profitable revenue growth and enhancing client experience:We launched the CIBC Mobile Payments App, marking another first for CIBC. Our clients now have an ability to make credit card payments using their smartphone, putting them at the leading edge of a market that will grow significantly in 2013 and beyond;CIBC continues to deliver mobile innovations, offering anytime, anywhere access to banking and financial information, with the launch of a new mobile banking app for President's Choice Financial clients. The new PC Financial Mobile Banking App is compatible with iPhone, iPod touch and iPad, with Android support coming soon;The ongoing conversion of our FirstLine clients into CIBC-branded mortgages continues to exceed our targets;We opened three branches and will open, expand or relocate 23 branches by the end of 2013 to better serve our clients;As the lead sponsor of the CIBC Pan Am and Parapan Am Games, we announced the start of construction for the new CIBC Pan Am and Parapan Am Athletics Stadium at York University. CIBC's objectives for the Pan Am and Parapan Am Games are to inspire a generation of young athletes, enrich our communities, provide significant opportunities for local businesses and leave behind a sustainable legacy; andTo enhance financial literacy, we entered into a new partnership with HGTV's Income Property and trusted Canadian real estate expert, Scott McGillivray, to reach consumers who want to better equip themselves with financial know-how prior to home purchases or renovations.Wealth Management reported net income of $90 million for the first quarter, down $10 million or 10% from the same quarter last year. Excluding a gain of $37 million ($35 million after-tax) relating to an equity-accounted investment in the first quarter of 2012, included as an item of note, net income was up $25 million or 38% from the same quarter last year.Revenue of $432 million was down $3 million or 1% compared to the first quarter of 2012. Excluding the above-mentioned item of note, revenue was up $34 million or 9% from the same quarter last year.During the first quarter of 2013, our wealth management business continued its progress in support of our strategic priority to build our wealth management platform:Wealth Management has achieved an all-time high of $223 billion in assets under administration as a result of deepening client relationships and sustained sales momentum in our investment solutions;CIBC Investor's Edge launched a new online interface, providing clients with additional tools and functionality to monitor their investment portfolios;We achieved our strongest quarterly long-term mutual fund net sales results on record with $1.7 billion for the first quarter; andIn CIBC Wood Gundy, we continued to invest in our strong technology platform with the launch of the latest portfolio management system to support client relationships through enhanced functionalities and advisor-focused work flow.Wholesale Banking reported net income of $91 million for the first quarter, down $102 million from the prior quarter. Excluding items of note, which include the settlement related to the Estate of Lehman Brothers Holdings, Inc., adjusted net income was $200(1) million, up $8 million from the prior quarter.Revenue of $563 million was down $12 million or 2% from the prior quarter, primarily due to lower gains in the structured credit run-off business, partially offset by higher capital markets revenue in fixed income and higher revenue from corporate credit products.Wholesale Banking had several notable achievements during the first quarter that supported its objective to be the premier client-focused wholesale bank centred in Canada:CIBC acted as lead coordinator for Canada Housing Trust No.1's $5.0 billion issuance of 1.7% Canada Mortgage Bonds due December 15, 2017;CIBC acted as joint bookrunner on Husky Energy's $3.2 billion credit facilities; CIBC acted as financial advisor to GDF Suez on the sale of 60% interest in its Canadian renewable generation portfolio to Mitsui & Co. and a consortium led by Fiera Axium Infrastructure with an enterprise value in excess of $2.0 billion;CIBC acted as joint bookrunner on a $700 million bond offering for Reliance LP;CIBC acted as financial advisor to Penn West on the sale of its 11.7% Net Royalty Interest in its Weyburn Oil Unit to Franco-Nevada for $400 million; andCIBC acted as joint bookrunner of Hudson's Bay Company's $380 million common share initial public offering."CIBC delivered solid performance during the first quarter," says Mr. McCaughey. "The investments we are making in our retail and business banking, wealth management and wholesale banking businesses are furthering our strength and positioning us well for the future."CIBC in our communitiesCIBC is committed to supporting causes that matter to our clients, our employees and our communities. During the quarter:CIBC Miracle Day raised a record $4.5 million in donated fees and commissions that will support over 450 children's charities across Canada, and in the U.K. and the U.S.;CIBC's 2012 United Way campaign raised $11.1 million, marking an increase of 30% per cent over last year's total of $8.5 million; andThe top student fundraisers in the Canadian Breast Cancer Foundation CIBC Run for the Cure Post Secondary Challenge won $2,500 CIBC Education Awards to help pay for their studies._____________________________________________(1) For additional information, see the "Non-GAAP measures" section.________________________________________________The information on the following pages forms a part of this press release.(The board of directors of CIBC reviewed this press release prior to it being issued. CIBC's controls and procedures support the ability of the President and Chief Executive Officer and the Chief Financial Officer of CIBC to certify CIBC's first quarter financial report and controls and procedures. CIBC's CEO and CFO will voluntarily provide to the Securities and Exchange Commission a certification relating to CIBC's first quarter financial information, including the attached unaudited interim consolidated financial statements, and will provide the same certification to the Canadian Securities Administrators.)Management's discussion and analysisManagement'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 quarter ended January 31, 2013, compared with prior quarters. The MD&A should be read in conjunction with our 2012 Annual Report and the unaudited interim consolidated financial statements included in this report. 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. This MD&A is current as of February 27, 2013. Additional information relating to CIBC is available on SEDAR at www.sedar.com and on the 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 throughout this quarterly report can be found on pages 182 to 185 of our 2012 Annual Report.External reporting changesBasel IIIWe adopted the Office of the Superintendent of Financial Institution's (OSFI) revised Capital Adequacy Requirements (CAR) Guideline effective January 2013.  The revised CAR Guideline reflects the changes to capital requirements, commonly referred to as Basel III, that have been issued by the Basel Committee on Banking Supervision (BCBS). 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 report, in other filings with Canadian securities regulators or the U.S. Securities and Exchange Commission and in other communications. These statements include, but are not limited to, statements made in the "Overview - Income taxes", "Overview - Outlook for calendar year 2013", "Review of quarterly financial information", "Capital Resources", "Management of risk - Credit risk", "Management of risk - Market risk", "Management of risk - Liquidity risk", "Management of risk - Operational risk", and "Accounting and control matters" sections of this report and other statements about our operations, business lines, financial condition, risk management, priorities, targets, ongoing objectives, strategies and outlook for 2013 and subsequent periods. Forward-looking statements are typically identified by the words "believe", "expect", "anticipate", "intend", "estimate" and other similar expressions or future or conditional verbs such as "will", "should", "would" and "could". By their nature, these statements require us to make assumptions, including the economic assumptions set out in the "Overview - Outlook for calendar year 2013" section of this report, and are subject to inherent risks and uncertainties that may be general or specific. 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: credit, market, liquidity, strategic, insurance, operational, reputation and legal, regulatory and environmental risk; the effectiveness and adequacy of our risk management models and processes; legislative or regulatory developments in the jurisdictions where we operate; amendments to, and interpretations of, risk-based capital guidelines and reporting instructions; the resolution of legal proceedings and related 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; the possible effect on our business of international conflicts and the war on terror; natural disasters, public health emergencies, disruptions to public infrastructure and other catastrophic events; reliance on third parties to provide components of our business infrastructure; the accuracy and completeness of information provided to us by clients and counterparties; the failure of third parties to comply with their obligations to us and our affiliates; intensifying competition from established competitors and new entrants in the financial services industry; technological change; global capital market activity; changes in monetary and economic policy; currency value fluctuations; general business and economic conditions worldwide, as well as in Canada, the U.S. and other countries where we have operations; changes in market rates and prices which may adversely affect the value of financial products; 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; 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. 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.First quarter financial highlights                   2013   2012(1)  2012 Unaudited, as at or for the three months ended    Jan. 31   Oct. 31   Jan. 31 Financial results ($ millions)              Net interest income   $1,855   $1,848   $1,842  Non-interest income    1,326    1,311    1,315  Total revenue    3,181    3,159    3,157  Provision for credit losses    265    328    338  Non-interest expenses    1,987    1,829    1,791  Income before taxes    929    1,002    1,028  Income taxes    131    150    193  Net income   $798   $852   $835  Net income attributable to non-controlling interests   $2   $2   $3   Preferred shareholders    25    29    56   Common shareholders    771    821    776  Net income attributable to equity shareholders   $796   $850   $832  Financial measures              Reported efficiency ratio    62.5 %  57.9 %  56.7 %Adjusted efficiency ratio (2)    56.1 %  56.5 %  55.3 %Loan loss ratio (3)    0.42 %  0.53 %  0.54 %Return on common shareholders' equity    19.9 %  21.7 %  22.4 %Net interest margin    1.83 %  1.83 %  1.85 %Net interest margin on average interest-earning assets (4)    2.12 %  2.14 %  2.16 %Return on average assets (5)    0.79 %  0.85 %  0.84 %Return on average interest-earning assets (4)(5)    0.91 %  0.99 %  0.98 %Total shareholder return    7.13 %  8.42 %  2.78 %Common share information              Per share ($)                - basic earnings   $1.91   $2.02   $1.94    - reported diluted earnings    1.91    2.02    1.93    - adjusted diluted earnings (2)    2.15     2.04    1.97    - dividends    0.94    0.94    0.90    - book value    38.07    37.48    34.31  Share price ($)                - high    84.10    78.56    78.00    - low    76.70    72.97    68.43    - closing    83.20    78.56    76.25  Shares outstanding (thousands)                - weighted-average basic    403,332    405,404    401,099    - weighted-average diluted    403,770    405,844    401,613    - end of period    401,960    404,485    402,728  Market capitalization($ millions)   $33,443   $31,776   $30,708  Value measures              Dividend yield (based on closing share price)    4.5 %  4.8 %  4.7 %Reported dividend payout ratio    49.2 %  46.4 %  46.5 %Adjusted dividend payout ratio(2)    43.7 %  46.1 %  45.5 %Market value to book value ratio    2.19    2.10    2.22  On- and off-balance sheet information ($ millions)              Cash, deposits with banks and securities   $72,656   $70,061   $71,065  Loans and acceptances, net of allowance    251,139    252,732    250,719  Total assets    392,783    393,385    391,449  Deposits    306,304    300,344    296,137  Common shareholders' equity    15,303    15,160    13,817  Average assets    402,313    401,092    396,122  Average interest-earning assets (4)    347,020    343,840    339,567  Average common shareholders' equity    15,361    15,077    13,826  Assets under administration(6)    1,429,049    1,445,870    1,364,509  Balance sheet quality measures              Basel III - Transitional basis                 Risk-weighted assets (RWA) ($ billions)   $134.8    n/a   n/a  Common Equity Tier 1 ratio    11.5 %  n/a   n/a  Tier 1 capital ratio    12.4 %  n/a   n/a  Total capital ratio    15.3 %  n/a   n/a Basel III - All-in basis               RWA ($ billions)   $126.4    n/a   n/a  Common Equity Tier 1 ratio    9.6 %  n/a   n/a  Tier 1 capital ratio    12.0 %  n/a   n/a  Total capital ratio    15.3 %  n/a   n/a Basel II               RWA ($ billions)    n/a  $115.2   $111.5   Tier 1 capital ratio    n/a   13.8 %  14.3 % Total capital ratio    n/a   17.3 %  18.1 %Other information              Retail / wholesale ratio (2)(7)    78 % / 22%  77 % / 23%  78 % / 22%Full-time equivalent employees (8)    42,793    42,595    42,181  (1) Certain amounts have been reclassified to conform to the presentation adopted in the current period.  (2) For additional information, see the "Non-GAAP measures" section.  (3) The ratio is calculated as the provision for credit losses on impaired loans to average loans and acceptances, net of allowance for credit losses. The provision for credit losses on impaired loans includes provision for: individual allowance; collective allowance on personal, scored small business and mortgages that are greater than 90 days delinquent; and net credit card write-offs.  (4) Average interest-earning assets include interest-bearing deposits with banks, securities, securities borrowed or purchased under resale agreements, and loans net of allowances.(5) Net income expressed as a percentage of average assets or average interest-earning assets.  (6) Includes the full contract amount of assets under administration or custody under a 50/50 joint venture between CIBC and The Bank of New York Mellon.  (7) For the purposes of calculating this ratio, Retail includes Retail and Business Banking, Wealth Management, and International banking operations (reported as part of Corporate and Other). The ratio represents the amount of economic capital attributed to these businesses as at the end of the period.(8) Full-time equivalent employees is a measure that normalizes the number of full-time and part-time employees, base plus commissioned employees, and 100% commissioned employees into equivalent full time units based on actual hours of paid work during a given period.  n/a Not applicable.     OverviewFinancial resultsReported net income for the quarter was $798 million, compared to $835 million for the same quarter last year and $852 million for the prior quarter.Reported diluted earnings per share (EPS) for the quarter was $1.91, compared to $1.93 for the same quarter last year and $2.02 for the prior quarter.Adjusted diluted EPS(1) for the quarter was $2.15, compared to $1.97 for the same quarter last year and $2.04 for the prior quarter.Net income was affected by the following items of note:$148 million ($109 million after-tax) loss from the structured credit run-off business, including the charge in respect of a settlement of the U.S. Bankruptcy Court adversary proceeding brought by the Estate of Lehman Brothers Holdings, Inc.(Wholesale Banking);$16 million ($16 million after-tax) gain, net of associated expenses, on the sale of our Hong Kong and Singapore-based private wealth management business (Corporate and Other); and$5 million ($4 million after-tax) amortization of intangible assets ($2 million after-tax in Retail and Business Banking and $2 million after-tax in Corporate and Other).The above items of note increased revenue by $28 million, non-interest expenses by $165 million, and decreased income tax expenses by $40 million. In aggregate, these items of note decreased net income by $97 million.(1) For additional information, see the "Non-GAAP measures" section.Net interest incomeNet interest income was up $13 million or 1% from the same quarter last year, primarily due to higher trading-related net interest income, wider retail spreads, and volume growth across most retail products, partially offset by lower treasury-related net interest income.Net interest income was up $7 million from the prior quarter, primarily due to higher trading-related net interest income and wider retail spreads, largely offset by lower treasury-related net interest income.Non-interest incomeNon-interest income was up $11 million or 1% from the same quarter last year, primarily due to higher mutual fund and credit fees, and higher gains net of write-downs on available-for-sale (AFS) securities, partially offset by lower trading income.  The current quarter had a gain on sale of the private wealth management business as noted above, while the same quarter last year had a gain relating to an equity-accounted investment in our Wealth Management strategic business unit (SBU), also included as an item of note.Non-interest income was up $15 million or 1% from the prior quarter. The prior quarter included a loss relating to the change in valuation of collateralized derivatives to an overnight index swap (OIS) basis, and a gain on sale of interests in entities in relation to the acquisition of TMX Group Inc. (TMX Group) by Maple Group Acquisition Corporation (Maple), both included as items of note. The current quarter had a gain on sale of the private wealth management business as noted above, higher gains net of write-downs on AFS securities, and higher mutual fund fees, partially offset by lower income from our equity accounted investments, and underwriting and advisory fees.Provision for credit lossesThe provision for credit losses was down $73 million or 22% from the same quarter last year. In Retail and Business Banking, provisions were down due to lower write-offs and bankruptcies in the cards portfolio. In Wholesale Banking, provisions were down due to lower losses in the U.S. real estate finance portfolio. In Corporate and Other, provisions were down due to lower losses in CIBC FirstCaribbean International Bank (CIBC FirstCaribbean) and higher net provision reversals related to collective allowance reported in this segment.The provision for credit losses was down $63 million or 19% from the prior quarter. In Retail and Business Banking, provisions were down due to lower losses in the business lending portfolio. In Wholesale Banking, provisions were down due to lower losses in the exited U.S. leveraged finance portfolio. In Corporate and Other, provisions were up due to higher losses in CIBC FirstCaribbean, and the provision for collective allowance reported in this segment was comparable to the prior quarter.Non-interest expensesNon-interest expenses were up $196 million or 11% compared to the same quarter last year, primarily due to higher expenses in the structured credit run-off business noted above, and higher employee compensation and benefits.Non-interest expenses were up $158 million or 9% from the prior quarter, primarily due to higher expenses in the structured credit run-off business noted above, and higher employee compensation and benefits, partially offset by lower advertising, computer and office equipment, and occupancy costs.Income taxesIncome tax expense was down $62 million or 32% from the same quarter last year, primarily due to lower income and higher tax-exempt income.Income tax expense was down $19 million or 13% from the prior quarter, mainly due to lower income.In prior years, the Canada Revenue Agency issued reassessments disallowing the deduction of approximately $3.0 billion of the 2005 Enron settlement payments and related legal expenses. The matter is currently in litigation and on December 21, 2011 (and reconfirmed on July 5, 2012), in connection with a motion by CIBC to strike the Crown's replies, the Tax Court of Canada struck certain portions of the replies and directed the Crown to submit amended replies. Both the Crown and CIBC appealed the ruling to the Federal Court of Appeal, and the appeal was heard on November 21, 2012. A decision has not yet been rendered.Should we successfully defend our tax filing position in its entirety, we would recognize an additional accounting tax benefit of $214 million and taxable refund interest of approximately $187 million. Should we fail to defend our position in its entirety, we would incur an additional tax expense of approximately $866 million and non-deductible interest of approximately $124 million.Foreign exchange The estimated impact of U.S. dollar translation on key lines of our interim consolidated statement of income, as a result of changes in average exchange rates, is as follows:       Jan. 31, 2013  Jan. 31, 2013          vs.  vs. $ millions, for the three months ended      Jan. 31, 2012  Oct. 31, 2012 Estimated increase (decrease) in:             Total revenue     $(7) $2    Provision for credit losses      -   -    Non-interest expense      (3)  1    Income taxes      -   -    Net income      (4)  1  Average US$ appreciation (depreciation) relative to C$      (2)% 1 %            Impact of items of note in prior periodsNet income for the prior quarters was affected by the following items of note:Q4, 2012$57 million ($32 million after-tax) loan losses in our exited U.S. leveraged finance portfolio (Wholesale Banking);$51 million ($37 million after-tax) gain from the structured credit run-off business (Wholesale Banking);$33 million ($24 million after-tax) loss relating to the change in valuation of collateralized derivatives to the OIS basis ($23 million after-tax in Wholesale Banking and $1 million after-tax in Corporate and Other);$24 million ($19 million after-tax) gain on sale of interests in entities in relation to the acquisition of TMX Group by Maple, net of associated expenses (Wholesale Banking); and$7 million ($6 million after-tax) amortization of intangible assets ($2 million after-tax in Retail and Business Banking and $4 million after-tax in Corporate and Other).The above items of note increased revenue by $52 million, provision for credit losses by $53 million, non-interest expenses by $21 million, and decreased income tax expenses by $16 million. In aggregate, these items of note decreased net income by $6 million.Q1, 2012$37 million ($35 million after-tax) gain relating to an equity-accounted investment (Wealth Management);$35 million ($26 million after-tax) loss from the structured credit run-off business (Wholesale Banking); and$9 million ($7 million after-tax) amortization of intangible assets ($2 million after-tax in Retail and Business Banking and $5 million after-tax in Corporate and Other).The above items of note increased revenue by $10 million, non-interest expenses by $17 million, and decreased income tax expenses by $9 million. In aggregate, these items of note increased net income by $2 million.In addition, net income attributable to common shareholders was also affected by the following item of note:$18 million premium paid on preferred share redemptions.Significant eventsLehman Brothers bankruptcy proceedingsDuring the quarter, CIBC recognized a US$150 million charge (US$110 million after-tax) in respect of the full settlement of the U.S. Bankruptcy Court adversary proceeding brought by the Estate of Lehman Brothers Holdings, Inc. challenging the reduction to zero of our unfunded commitment on a variable funding note. In 2008, we recognized a US$841 million gain on the variable funding note as further detailed in Note 23 of the 2012 consolidated financial statements.Private wealth management (Asia)On January 25, 2013, CIBC sold its stand-alone Hong Kong and Singapore-based private wealth management business. This niche advisory and brokerage business, which was included in International banking within Corporate and Other, provided private banking services to a small number of high-net-worth individuals in the Asia-Pacific region and had assets under management of approximately $2 billion. As a result, CIBC recognized a gain, net of associated expenses, of $16 million ($16 million after-tax) during the quarter. CIBC's other businesses in Asia are unaffected by this transaction.Outlook for calendar year 2013Moderate economic growth is likely to continue in both Canada and the U.S. in 2013. Real GDP gains are likely to be in the vicinity of 2% in both Canada and the U.S. in the face of soft growth overseas, and ongoing fiscal tightening. We expect European governments will prevent sovereign debt troubles from spilling over into a larger Eurozone banking crisis but fiscal tightening has left Europe in a mild recession. In the U.S., improving household credit fundamentals and continued recovery in home building will help offset the drag from tighter fiscal policy, although the degree of spending cuts remains to be determined.Canada's economy will benefit from a pick-up in oil output, but will see somewhat less robust domestic demand. Government spending will remain a slight negative for growth as fiscal tightening continues. Consumer demand will be supported by ongoing job creation, but will be held close to income gains as the appetite for credit is held in check by existing high debt levels, even with the Bank of Canada avoiding interest rate increases through 2013. Housing is turning from a strong growth contributor to a slight negative this year as the impact of softer sales shows up in a modest retreat in construction activity.Retail and Business Banking is expected to face slightly slower growth in demand for mortgages, while consumer credit demand could continue to see limited growth. Demand for business credit should continue at a healthy growth rate. Slightly slower economic growth is unlikely to result in deterioration in household credit quality, with the unemployment rate holding nearly steady.Wealth Management should see an improvement in demand for equities and other risk assets over the course of 2013 as global uncertainties are gradually resolved.Wholesale Banking will continue to benefit from a healthy pace of debt financings as both governments and corporations take advantage of low interest rates and robust market conditions. Equity issuance could improve over the course of the year as global growth uncertainties are gradually resolved, a trend that should also support merger activity. Corporate credit demand should be supported by growth in capital spending, although the public debt market and internal cash flows will be a competitive source of funding.Review of quarterly financial information                               $ millions, except per share amounts,                          for the three months ended    2013           2012        2011                                    Jan. 31  Oct. 31(1) Jul. 31  Apr. 30  Jan. 31  Oct. 31  Jul. 31  Apr. 30Revenue                           Retail and Business Banking   $2,065  $2,036  $2,085  $2,004  $2,029  $2,076  $2,035  $1,932  Wealth Management    432   420   401   418   435   396   404   420  Wholesale Banking (2)    563   575   527   463   495   561   503   477  Corporate and Other (2)    121   128   136   199   198   162   189   186 Total revenue   $3,181  $3,159  $3,149  $3,084  $3,157  $3,195  $3,131  $3,015 Net interest income   $1,855  $1,848  $1,883  $1,753  $1,842  $1,776  $1,785  $1,731 Non-interest income    1,326   1,311   1,266   1,331   1,315   1,419   1,346   1,284 Total revenue    3,181   3,159   3,149   3,084   3,157   3,195   3,131   3,015 Provision for credit losses    265   328   317   308   338   306   310   245 Non-interest expenses    1,987   1,829   1,831   1,764   1,791   1,920   2,005   1,756      929   1,002   1,001   1,012   1,028   969   816   1,014 Income taxes    131   150   160   201   193   212   225   247 Net income   $798  $852  $841  $811  $835  $757  $591  $767 Net income attributable to:                           Non-controlling interests   $2  $2  $2  $1  $3  $3  $2  $3  Equity shareholders      796   850   839   810   832   754   589   764 Earnings per share                            - basic   $1.91  $2.02  $2.00  $1.90  $1.94  $1.80  $1.35  $1.83   - diluted    1.91   2.02   2.00   1.90   1.93   1.79   1.33   1.80 (1) Certain amounts have been reclassified to conform to the presentation adopted in the current period.  (2) Wholesale Banking revenue and income taxes are reported on a taxable equivalent basis (TEB) with an equivalent offset in the revenue and income taxes of Corporate and Other.     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 capital markets activity, which affects our brokerage, investment management, and wholesale banking activities.RevenueRetail and Business Banking revenue has benefitted from volume growth across most retail products, offset to some extent by the continued low interest rate environment and attrition in our exited FirstLine mortgage business.Wealth Management revenue has benefitted from continued strong net sales of long-term mutual funds and higher average assets under management. Income from our proportionate share in American Century Investments (ACI) is included from September 1, 2011 and a gain related to this equity-accounted investment was included in the first quarter of 2012.Wholesale Banking revenue is influenced to a large extent by capital market conditions. Revenue had been adversely affected by losses in the structured credit run-off business up to the third quarter of 2012, while the fourth quarter included a gain. The second quarter of 2012 included the hedge accounting loss on leveraged leases. The fourth quarter of 2012 included a gain on sale of interests in entities in relation to the acquisition of TMX Group by Maple and a loss relating to the change in valuation of collateralized derivatives to an OIS basis.Corporate and Other had lower unallocated treasury revenue in the second half of 2012 and first quarter of 2013. The current quarter also included a gain on sale of the private wealth management business (Asia).Provision for credit lossesThe provision for credit losses is dependent upon the credit cycle in general and on the credit performance of the loan portfolios. Losses in the cards portfolio improved in 2012 and the first quarter of 2013. Wholesale Banking provisions declined in the second and third quarters of 2011, while the fourth quarter of 2011 had higher losses in the exited European leveraged finance portfolio. During 2012, we had higher losses in U.S. real estate finance and the exited U.S. leveraged finance portfolio.Non-interest expensesNon-interest expenses have fluctuated over the period largely due to changes in employee compensation and benefits, including pension expense. An impairment loss relating to CIBC FirstCaribbean goodwill was recognized in the third quarter of 2011. The current quarter had higher expenses in the structured credit run-off business.Income taxesIncome taxes vary with changes in income subject to tax, and the jurisdictions in which the income is earned. Taxes can also be affected by the impact of significant items. Tax-exempt income has been trending higher since the second quarter of 2011. The above-noted impairment loss relating to CIBC FirstCaribbean goodwill was not tax-effected.Non-GAAP measuresWe use a number of financial measures to assess the performance of our business lines. 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 useful in analyzing financial performance. For a more detailed discussion on our non-GAAP measures, see page 19 of the 2012 Annual Report.The following table provides a reconciliation of non-GAAP to GAAP measures related to CIBC on a consolidated basis.           2013   2012   2012 $ millions, as at or for the three months ended        Jan. 31   Oct. 31   Jan. 31 Reported and adjusted diluted EPS                   Reported net income attributable to diluted common shareholders   A   $771   $821   $776  Adjusting items:                   After-tax impact of items of note(1)        97    6    16  Adjusted net income attributable to diluted common shareholders (2)   B   $868   $827   $792  Reported diluted weighted-average common shares outstanding (thousands)   C    403,770    405,844    401,613  Reported diluted EPS ($)   A/C   $1.91   $2.02   $1.93  Adjusted diluted EPS ($) (2)   B/C    2.15    2.04    1.97  Reported and adjusted efficiency ratio                  Reported total revenue   D   $3,181   $3,159   $3,157  Adjusting items:                   Pre-tax impact of items of note(1)        (28)   (52)   (10)  TEB        92    92    57  Adjusted total revenue (2)   E   $3,245   $3,199   $3,204  Reported non-interest expenses   F   $1,987   $1,829   $1,791  Adjusting items:                   Pre-tax impact of items of note(1)        (165)   (21)   (17) Adjusted non-interest expenses (2)   G   $1,822   $1,808   $1,774  Reported efficiency ratio   F/D    62.5 %  57.9 %  56.7 %Adjusted efficiency ratio (2)   G/E    56.1 %  56.5 %  55.3 %Reported and adjusted dividend payout ratio                  Reported net income attributable to common shareholders   H   $771    821    776  Adjusting items:                   After-tax impact of items of note(1)        97    6    16  Adjusted net income attributable to common shareholders (2)   I   $868   $827   $792  Dividends paid to common shareholders   J   $379   $381   $360  Reported dividend payout ratio   J/H    49.2 %  46.4 %  46.5 %Adjusted dividend payout ratio (2)   J/I    43.7 %  46.1 %  45.5 %   $ millions, for the three months endedRetail andBusinessBankingWealthManagementWholesaleBankingCorporateand OtherCIBCTotalJan. 31Reported net income$ 611 $ 90 $ 91 $ 6 $ 798 2013Adjusting items:             After-tax impact of items of note(1)  2   -   109  (14)  97   Adjusted net income(2)$ 613 $ 90 $ 200 $(8)$ 895 Oct. 31Reported net income$ 569 $ 84 $ 193 $ 6 $ 852 2012Adjusting items:             After-tax impact of items of note(1)  2   -  (1)  5   6   Adjusted net income(2)$ 571 $ 84 $ 192 $ 11 $ 858 Jan. 31Reported net income$ 567 $ 100 $ 133 $ 35 $ 835 2012Adjusting items:             After-tax impact of items of note(1)  2  (35)  26   5  (2)  Adjusted net income(2)$ 569 $ 65 $ 159 $ 40 $ 833 (1)Reflects impact of items of note under "Financial results" section.(2)Non-GAAP measure. Strategic business units overviewCIBC has three SBUs - Retail and Business Banking, Wealth Management and Wholesale Banking. These SBUs are supported by six functional groups - Technology and Operations, Corporate Development, Finance, Treasury, Administration, and Risk Management, which form part of Corporate and Other. The revenue, expenses and balance sheet resources of these functional groups are generally allocated to the business lines within the SBUs. Corporate and Other also includes our International banking operations comprising mainly CIBC FirstCaribbean, strategic investments in the CIBC Mellon joint ventures and The Bank of N.T. Butterfield & Son Limited, and other income statement and balance sheet items not directly attributable to the business lines. The key methodologies and assumptions used in reporting financial results of our SBUs are provided on page 22 of the 2012 Annual Report.Retail and Business BankingRetail and Business Banking provides clients across Canada with financial advice, banking, investment, and authorized insurance products and services through a strong team of advisors and more than 1,100 branches, as well as our ABMs, mobile sales force, and telephone, online and mobile banking.Results (1)                                            2013   2012   2012 $ millions, for the three months ended      Jan. 31   Oct. 31   Jan. 31 Revenue                 Personal banking     $1,623   $1,616   $1,563   Business banking      380    378    373   Other      62    42    93  Total revenue      2,065    2,036    2,029  Provision for credit losses      241    255    281  Non-interest expenses      1,021    1,030    996  Income before taxes      803    751    752  Income taxes      192    182    185  Net income     $611   $569   $567  Net income attributable to:                 Equity shareholders (a)     $611   $569   $567  Efficiency ratio      49.4 %  50.6 %  49.1 %Return on equity (2)      58.3 %  57.1 %  58.2 %Charge for economic capital (2)(b)     $(132)  $(126)  $(130) Economic profit (2)(a+b)     $479   $443   $437  Full-time equivalent employees      22,063    21,857    21,706  (1) For additional segmented information, see the notes to the interim consolidated financial statements. (2) For additional information, see the "Non-GAAP measures" section.   Financial overviewNet income for the quarter was $611 million, up $44 million or 8% from the same quarter last year, primarily due to lower provision for credit losses and higher revenue, partially offset by higher non-interest expenses.Net income was up $42 million or 7% compared to the prior quarter, primarily due to higher revenue and lower provision for credit losses.RevenueRevenue was up $36 million or 2% from the same quarter last year.Personal banking revenue was up $60 million or 4%, primarily due to volume growth across most products and wider spreads.Business banking revenue was up $7 million or 2%, primarily due to volume growth and higher fees, partially offset by narrower spreads.Other revenue was down $31 million mainly due to lower treasury allocations.Revenue was up $29 million or 1% from the prior quarter.Personal banking revenue was up $7 million, primarily due to volume growth.Business banking revenue was comparable to the prior quarter.Other revenue was up $20 million due to higher treasury allocations.Provision for credit lossesProvision for credit losses was down $40 million or 14% from the same quarter last year due to lower write-offs and bankruptcies in the cards portfolio.Provision for credit losses was down $14 million or 5% from the prior quarter, mainly due to lower losses in the business lending portfolio.Non-interest expensesNon-interest expenses were up $25 million or 3% from the same quarter last year, primarily due to increased spending on strategic business initiatives.Non-interest expenses were down $9 million or 1% from the prior quarter, primarily due to lower advertising costs.Income taxesIncome taxes were up $7 million or 4% from the same quarter last year due to higher income.Income taxes were up $10 million or 5% from the prior quarter due to higher income.Aeorplan AgreementCIBC and Aimia Canada Inc. (Aimia) are parties to an agreement (the Aeroplan Agreement) pursuant to which CIBC pays Aimia for Aeroplan miles credited to participating CIBC cardholders' accounts, based on the value of the cardholders' purchases using such cards. The Aeroplan Agreement will expire on December 31, 2013 unless extended by the parties or replaced in accordance with its terms. CIBC has engaged in periodic extension discussions with Aimia but is also exploring alternatives to extending the Aeroplan Agreement. At this stage, there can be no assurance that the Aeroplan Agreement will be extended.Wealth ManagementWealth Management provides relationship-based advisory services and an extensive suite of leading investment solutions to meet the needs of institutional, retail and high net worth clients. Our asset management, retail brokerage and private wealth management businesses combine to create an integrated offer, delivered through nearly 1,500 advisors across Canada.Results (1)                                          2013   2012     2012 $ millions, for the three months ended      Jan. 31   Oct. 31   Jan. 31 Revenue                 Retail brokerage     $259   $256   $249   Asset management      144    138    162   Private wealth management      29    26    24  Total revenue      432    420    435  Non-interest expenses      315    308    312  Income before taxes      117    112    123  Income taxes      27    28    23  Net income     $90   $84   $100  Net income attributable to:                 Equity shareholders (a)     $90   $84   $100  Efficiency ratio      73.0 %  73.4 %  71.7 %Return on equity (2)      19.1 %  18.9 %  24.5 %Charge for economic capital (2)(b)     $(58)  $(55)  $(52) Economic profit (2)(a+b)     $32   $29   $48  Full-time equivalent employees      3,765    3,783    3,721  (1) For additional segmented information, see the notes to the interim consolidated financial statements.(2) For additional information, see the "Non-GAAP measures" section.   Financial overviewNet income for the quarter was $90 million, a decrease of $10 million or 10% from the same quarter last year due to a gain relating to an equity-accounted investment in the first quarter of 2012 included as an item of note. Excluding this gain, revenue was higher across all lines of business.Net income was up $6 million or 7% compared to the prior quarter, primarily due to higher revenue, partially offset by higher non-interest expenses.RevenueRevenue was down $3 million or 1% compared to the same quarter last year.Retail brokerage revenue was up $10 million or 4%, primarily due to higher fee-based revenue.Asset management revenue was down $18 million or 11%, primarily due to a gain in the same quarter last year noted above, partially offset by higher client assets under management driven by higher long-term net sales of mutual funds and improved capital markets.Private wealth management revenue was up $5 million or 21%, mainly due to higher assets under management driven by client growth, including the impact of the acquisition of the MFS McLean Budden private wealth management business in September 2012.Revenue was up $12 million or 3% from the prior quarter.Retail brokerage revenue was up $3 million or 1%, primarily due to higher commissions from equity trading and fee-based revenue.Asset management revenue was up $6 million or 4%, primarily due to higher client assets under management driven by higher long-term net sales of mutual funds and improved capital markets.Private wealth management revenue was up $3 million or 12%, mainly due to higher assets under management, including a full quarter impact of the acquisition noted above.Non-interest expensesNon-interest expenses were up $3 million or 1% from the same quarter last year, and up $7 million or 2% from the prior quarter, primarily due to higher performance-based compensation.Income taxesIncome taxes were up $4 million from the same quarter last year mainly due to a lower tax rate on the gain discussed above.Income taxes were comparable to the prior quarter.Wholesale BankingWholesale Banking provides a wide range of credit, capital markets, investment banking and research products and services to government, institutional, corporate and retail clients in Canada and in key markets around the world.Results (1)                                          2013   2012   2012 $ millions, for the three months ended      Jan. 31   Oct. 31   Jan. 31 Revenue                 Capital markets     $328   $295   $307   Corporate and investment banking      213    206    197   Other      22    74    (9) Total revenue (2)      563    575    495  Provision for credit losses      10    66    26  Non-interest expenses      445    263    289  Income before taxes      108    246    180  Income taxes (2)      17    53    47  Net income     $91   $193   $133  Net income attributable to:                 Equity shareholders (a)     $91   $193   $133  Efficiency ratio (2)      79.0 %  45.7 %  58.3 %Return on equity (3)      16.3 %  35.0 %  26.5 %Charge for economic capital (3)(b)     $(68)  $(70)  $(65) Economic profit (3)(a+b)     $23   $123   $68  Full-time equivalent employees      1,261    1,268    1,214  (1) For additional segmented information, see the notes to the interim consolidated financial statements.(2) Revenue and income taxes are reported on a TEB basis. Accordingly, revenue and income taxes include a TEB adjustment of $92 million for the three months ended January 31, 2013 ($92 million for the three months ended October 31, 2012 and $57 million for the three months ended January 31, 2012).  The equivalent amounts are offset in the revenue and income taxes of Corporate and Other.(3) For additional information, see the "Non-GAAP measures" section.   Financial overviewNet income for the quarter was $91 million, down $42 million from the same quarter last year, mainly due to higher non-interest expenses, partially offset by higher revenue, a lower provision for credit losses and lower income taxes.Net income was down $102 million from the prior quarter, mainly due to higher non-interest expenses, partially offset by a lower provision for credit losses.Revenue Revenue was up $68 million or 14% from the same quarter last year.Capital markets revenue was up $21 million, primarily due to higher revenue from equity derivatives and a reversal of a credit valuation adjustment (CVA) charge against credit exposures to derivative counterparties (other than financial guarantors), partially offset by lower foreign exchange and commodities trading revenue.Corporate and investment banking revenue was up $16 million as higher revenue from corporate credit products was partially offset by lower revenue from U.S. real estate finance.Other revenue was up $31 million, primarily due to gains in the structured credit run-off business in the current quarter compared to losses in the prior year quarter.Revenue was down $12 million or 2% from the prior quarter.Capital markets revenue was up $33 million, mainly due to higher revenue from fixed income and a reversal of the CVA charge noted above, partially offset by lower revenue from equity derivatives trading.  The prior quarter included a loss relating to the change in valuation of collateralized derivatives to an OIS basis, which was partially offset by a gain on the sale of an interest in an entity in relation to the acquisition of TMX Group by Maple, both included as items of note.Corporate and investment banking revenue was up $7 million, primarily due to higher investment portfolio gains and higher revenue from corporate credit products, partially offset by lower revenue from U.S. real estate finance.Other revenue was down $52 million from the prior quarter, primarily due to lower gains in the structured credit run-off business.Provision for credit lossesProvision for credit losses was down $16 million from the same quarter last year due to lower losses in the U.S. real estate finance portfolio, and down $56 million from the prior quarter due to lower losses in the exited U.S. leveraged finance portfolio.Non-interest expensesNon-interest expenses were up $156 million or 54% from the same quarter last year, due to higher expenses in the structured credit run-off business related to the charge in respect of a settlement of the U.S. Bankruptcy Court adversary proceeding brought by the Estate of Lehman Brothers Holdings, Inc. (refer to "Structured credit run-off business" section for further details).Non-interest expenses were up $182 million or 69% from the prior quarter, primarily due to higher expenses in the structured credit run-off business as noted above, and higher performance-based compensation.Income taxesIncome tax expense for the quarter was $30 million lower than the prior year quarter, primarily due to lower income in the current quarter.Income tax expense was $36 million lower than the prior quarter, primarily due to lower income in the current quarter.Structured credit run-off business The results of the structured credit run-off business are included in the Wholesale Banking SBU.Results                                      2013  2012  2012 $ millions, for the three months ended      Jan. 31  Oct. 31  Jan. 31 Net interest income (expense)     $(14) $(19) $(15) Trading income (loss)       18   31   (8) FVO losses      (3)  (1)  (5) Other income      5   42   1  Total revenue      6   53   (27) Non-interest expenses      154   2   8  Income (loss) before taxes      (148)  51   (35) Income taxes      (39)  14   (9) Net income (loss)     $(109) $37  $(26)                The net loss for the quarter was $109 million (US$110 million), compared with $26 million (US$26 million) for the same quarter last year and net income of $37 million (US$37 million) for the prior quarter.The net loss for the quarter was mainly due to a charge in respect of a settlement of the U.S. Bankruptcy Court adversary proceeding brought by the Estate of Lehman Brothers Holdings, Inc., a decrease in the value of receivables related to protection purchased from financial guarantors (on loan assets that are carried at amortized cost), resulting from an increase in the mark-to-market (MTM) of the underlying positions, and net interest expense, partially offset by a CVA gain relating to financial guarantors and gains on unhedged positions.Position summary The following table summarizes our positions within our structured credit run-off business:                  Written credit                            derivatives, liquidity  Credit protection purchased fromUS$ millions, as at January 31, 2013  Investments and loans(1) and credit facilities  Financial guarantors  Other counterparties       Fair                               value of  Fair  Carrying                         trading,  value of  value of     Fair                   AFS  securities  securities     value of     Fair value     Fair value       and FVO  classified  classified     written credit     net of     net of    Notional  securities  as loans  as loans  Notional  derivatives  Notional  CVA  Notional  CVAUSRMM - CDO  $-  $-  $-  $-  $278  $231  $-  $-  $278  $232 CLO   3,804   -   3,634   3,627   3,129   60   6,031   87   267   6 Corporate debt   -   -   -   -   4,977   38   -   -   4,977   42 Other   865   559   51   54   641   69   287   27   26   1 Unmatched   -   -   -   -   -   -   134   112   374   -    $4,669  $559  $3,685  $3,681  $9,025  $398  $6,452  $226  $5,922  $281 October 31, 2012  $4,742  $564  $3,731  $3,749  $9,035  $455  $6,492  $269  $5,926  $316 (1) Excluded from the table above are equity and surplus note AFS securities that we obtained in consideration for commutation of our U.S. residential mortgage market (USRMM) contracts with financial guarantors. The equity securities had a carrying value of US$8 million (October 31, 2012: US$9 million) and the surplus notes had a notional value of US$140 million (October 31, 2012: US$140 million) and a carrying value of US$12 million (October 31, 2012: US$12 million).   USRMM - collateralized debt obligation (CDO)Our net USRMM position, consisting of a written credit derivative, amounted to US$47 million. This position was hedged through protection purchased from a large U.S.-based diversified multinational insurance and financial services company with which we have market-standard collateral arrangements.Collateralized loan obligation (CLO)CLO positions consist of super senior tranches of CLOs backed by diversified pools of primarily U.S. (62%) and European-based (36%) senior secured leveraged loans. As at January 31, 2013, approximately 22% of the total notional amount of the CLO tranches was rated equivalent to AAA, 72% was rated between the equivalent of AA+ and AA-, and the remainder was the equivalent of A. As at January 31, 2013, approximately 17% of the underlying collateral was rated equivalent to BB- or higher, 53% was rated between the equivalent of B+ and B-, 7% was rated equivalent to CCC+ or lower, with the remainder unrated. The CLO positions have a weighted-average life of 2.7 years and average subordination of 30%.Corporate debtCorporate debt exposure consists of a large matched super senior derivative, where CIBC has purchased and sold credit protection on the same reference portfolio. The reference portfolio consists of highly diversified, predominantly investment grade corporate credit. Claims on these contracts do not occur until cumulative credit default losses from the reference portfolio exceed 30% during the 47 month term of the contract. On this reference portfolio, we have sold protection to an investment dealer.OtherOur significant positions in Other, as at January 31, 2013, include:US$214 million notional value of CDOs consisting of trust preferred securities (TruPs) collateral, which are Tier I Innovative Capital Instruments issued by U.S. regional banks and insurers. These securities are classified as FVO securities and had a fair value of US$167 million;US$167 million notional value of trading securities with a fair value of US$135 million, and US$292 million notional value of written protection with a fair value of US$67 million, on inflation-linked notes, and CDO tranches with collateral consisting of high-yield corporate debt portfolios, TruPs and non-U.S. residential mortgage-backed securities, with 55% rated between the equivalent of A+ and A-, 36% rated between the equivalent of BBB+ and BBB-, and the majority of the remaining rated equivalent of BB+ or lower;US$58 million notional value of an asset-backed security (ABS) classified as a loan, with fair value of US$49 million and carrying value of US$52 million;Variable rate Class A-1/A-2 notes classified as trading securities with a notional value of US$290 million and a fair value of US$247 million, tracking notes classified as AFS with a notional value of US$10 million and a fair value of US$2 million, and loans with a notional value of US$59 million and fair value and carrying value of nil. These notes were originally received in exchange for our non-bank sponsored asset-backed commercial paper (ABCP) in January 2009, upon the ratification of the Montreal Accord restructuring; andUS$296 million of undrawn Margin Funding Facility related to the Montreal Accord restructuring.UnmatchedThe underlyings in our unmatched positions are a reference portfolio of corporate debt and a loan backed by film receivables.Credit protection purchased from financial guarantors and other counterpartiesThe following table presents the notional amounts and fair values of credit protection purchased from financial guarantors and other counterparties by counterparty credit quality, based on external credit ratings (Standard & Poor's (S&P) and/or Moody's Investors Service (Moody's)), and the underlying referenced assets. Excluded from the table below are certain performing loans and tranched securities positions in our continuing businesses, with a total notional amount of approximately US$60 million, which are partly secured by direct guarantees from financial guarantors or by bonds guaranteed by financial guarantors.                     Credit protection purchased                     from financial guarantors       Notional amounts of referenced assets and other counterparties        Corporate  CDO -       Total  Fair value     Fair valueUS$ millions as at January 31, 2013    CLO  debt  USRMM  Other Unmatched  notional  before CVA  CVA  net of CVAFinancial guarantors (1)                             Investment grade   $3,697  $-  $-  $57 $134  $3,888  $223  $(37) $186  Non-investment grade    75   -   -   177  -   252   35   (21)  14  Unrated    2,259   -   -   53  -   2,312   50   (24)  26        6,031   -   -   287  134   6,452   308   (82)  226 Other counterparties (1)                             Investment grade    267   20   278   26  -   591   238   2   240  Unrated    -   4,957   -   -  374   5,331   41   -   41        267   4,977   278   26  374   5,922   279   2   281     $6,298  $4,977  $278  $313 $508  $12,374  $587  $(80) $507 October 31, 2012   $6,284  $4,968  $298  $356 $512  $12,418  $692  $(107) $585 (1)   In cases where one credit rating agency does not provide a rating, the classification in the table is based on the rating provided by the other agency. Where ratings differ between agencies, we use the lower rating.  The unrated other counterparties are primarily two Canadian conduits. These conduits are in compliance with their collateral posting arrangements and have posted collateral exceeding current market exposure. The fair value of the collateral as at January 31, 2013 was US$360 million relative to US$41 million of net exposure.Lehman Brothers bankruptcy proceedingsDuring the quarter, CIBC recognized a US$150 million charge (US$110 million after-tax) in respect of the full settlement of the U.S. Bankruptcy Court adversary proceeding brought by the Estate of Lehman Brothers Holdings, Inc. challenging the reduction to zero of our unfunded commitment on a variable funding note. In 2008, we recognized a US$841 million gain on the variable funding note as further detailed in Note 23 of the 2012 consolidated financial statements.Corporate and OtherCorporate and Other includes the six functional groups - Technology and Operations, Corporate Development, Finance, Treasury, Administration, and Risk Management - that support CIBC's SBUs. The revenue, expenses and balance sheet resources of these functional groups are generally allocated to the business lines within the SBUs. Corporate and Other also includes our International banking operations comprising mainly CIBC FirstCaribbean, strategic investments in the CIBC Mellon joint ventures and The Bank of N.T. Butterfield & Son Limited, and other income statement and balance sheet items not directly attributable to the business lines.Results (1)                                         2013   2012   2012$ millions, for the three months ended       Jan. 31   Oct. 31   Jan. 31Revenue                 International banking     $ 163  $ 149  $ 148  Other       (42)   (21)   50 Total revenue (2)       121    128    198 Provision for credit losses       14    7    31 Non-interest expenses       206    228    194 Income (loss) before taxes       (99)   (107)   (27)Income taxes (2)       (105)   (113)   (62)Net income     $ 6  $ 6  $ 35 Net income attributable to:                 Non-controlling interests     $ 2  $ 2  $ 3  Equity shareholders       4    4    32 Full-time equivalent employees       15,704    15,687    15,540 (1)  For additional segmented information, see the notes to the interim consolidated financial statements.  (2)  TEB adjusted. See footnote 2 in "Wholesale Banking" section for additional details.   Financial overviewNet income for the quarter was $6 million, down $29 million from the same quarter last year primarily due to lower revenue.Net income was comparable to the prior quarter.RevenueRevenue was down $77 million or 39% from the same quarter last year.International banking revenue was up $15 million or 10% from the same quarter last year, primarily due to a gain on sale of the private wealth management business, included as an item of note.Other revenue was down $92 million from the same quarter last year due to lower unallocated treasury revenue and a higher TEB adjustment.Revenue was down $7 million or 5% from the prior quarter.International banking revenue was up $14 million or 9% from the prior quarter, primarily due to a gain on sale of the private wealth management business noted above.Other revenue was down $21 million from the prior quarter, primarily due to lower unallocated treasury revenue and lower income from equity-accounted investments.Provision for credit lossesProvision for credit losses was down $17 million compared to the same quarter last year, mainly due to lower losses in CIBC FirstCaribbean and higher provision reversals of collectively assessed credit losses relating to the cards and commercial banking portfolios, partially offset by higher provision in the personal lending portfolio.Provision for credit losses was up $7 million from the prior quarter, mainly due to higher losses in CIBC FirstCaribbean. Net higher provision reversals of collectively assessed credit losses relating to the cards portfolio were offset by higher provision in the personal lending portfolio.Non-interest expensesNon-interest expenses were up $12 million or 6% from the same quarter last year, mainly due to higher unallocated corporate support costs.Non-interest expenses were down $22 million or 10% from the prior quarter, mainly due to lower unallocated corporate support costs.Income taxesIncome tax benefit was up $43 million from the same quarter last year, primarily due to a higher TEB adjustment.Income tax benefit was down $8 million from the prior quarter.Financial condition Review of condensed consolidated balance sheet     2013   2012$ millions, as at    Jan. 31   Oct. 31Assets         Cash and deposits with banks   $5,636   $4,727 Securities    67,020    65,334 Securities borrowed or purchased under resale agreements    29,058    28,474 Loans and acceptances, net of allowance    251,139    252,732 Derivative instruments    25,085    27,039 Other assets    14,845    15,079     $392,783   $393,385 Liabilities and equity         Deposits   $306,304   $300,344 Capital Trust securities    1,669    1,678 Obligations related to securities lent or sold short or under repurchase agreements    18,289    21,259 Derivative instruments    24,551    27,091 Other liabilities    20,004    21,152 Subordinated indebtedness    4,791    4,823 Equity    17,175    17,038     $392,783   $393,385           AssetsAs at January 31, 2013, total assets were down $602 million from October 31, 2012.Cash and deposits with banks increased by $909 million or 19% mostly due to higher treasury deposit placements.Securities increased by $1.7 billion or 3%, with increases in both AFS securities and trading securities. AFS securities increased mainly in government-issued or guaranteed securities. Trading securities increased largely in the equity portfolios.Net loans and acceptances decreased by $1.6 billion. Residential mortgages were down $1.1 billion, primarily due to attrition in our FirstLine mortgage business, partially offset by new mortgage originations through CIBC channels. Personal loans were down $556 million and credit card loans were down $330 million due to net repayments. Business and government loans and acceptances were up $348 million due to growth in our domestic and international portfolios.Derivative instruments decreased by $2.0 billion or 7% largely driven by valuation of interest rate derivatives.Other assets decreased by $234 million or 2%, mainly due to a decrease in collateral pledged for derivatives, partially offset by an increase in income taxes receivable as a result of payments made in the quarter.LiabilitiesAs at January 31, 2013, total liabilities were down $739 million from October 31, 2012.Deposits increased by $6.0 billion or 2%, primarily driven by business and government and personal volume growth.Obligations related to securities lent or sold short or under repurchase agreements decreased by $3.0 billion or 14%, primarily due to client-driven activities.Derivative instruments decreased by $2.5 billion or 9% due to the valuation of interest rate derivatives.Other liabilities decreased by $1.1 billion or 5%, mainly due to lower acceptances and accrued liabilities.EquityAs at January 31, 2013, equity increased by $137 million or 1%, primarily due to a net increase in retained earnings, and the issuance of common shares pursuant to the stock option, shareholder investment, and employee share purchase plans (ESPP). These were offset in part by common shares purchased for cancellation, as explained in the "Significant capital management activity" section below.Capital resourcesWe actively manage our capital to maintain a strong and efficient capital base, to maximize risk-adjusted returns to shareholders, and to meet regulatory requirements. For additional details on capital resources, see pages 35 to 39 of the 2012 Annual Report.Basel III and revisions to regulatory capital requirementsOur regulatory capital requirements are determined in accordance with guidelines issued by OSFI.On December 10, 2012, OSFI issued the final version of revisions to its guidelines for capital adequacy in Canada which incorporate the adoption of the significant capital reforms, referred to as Basel III, issued by the BCBS. The most significant aspects of the reforms are measures to improve the quality of capital and increase capital requirements for the global financial system. These measures are discussed further on page 37 of the 2012 Annual Report.OSFI expects all institutions to establish target capital ratios that meet or exceed the 2019 all-in (i)minimum ratios plus conservation buffer early in the transition period. For the Common Equity Tier 1 ratio, the target is 7% by the first quarter of 2013. The targets for the Tier 1 capital ratio and Total capital ratio are 8.5% and 10.5%, respectively, to be established by the first quarter of 2014. These targets may be higher for certain institutions or groups of institutions if OSFI feels the circumstances warrant it.OSFI's capital adequacy guidelines provide for a deferral of the additional capital charge to cover credit valuation charges for bilateral OTC derivatives to January 1, 2014.  The delay provides for a coordinated start on the implementation of this new requirement with other significant jurisdictionsRegulatory capital Our capital ratios and assets-to-capital multiple (ACM) are presented in the following table:              2013   2012 $ millions, as at           Jan. 31(1)  Oct. 31(1)Basel III- Transitional basis                 Common Equity Tier 1 capital          $15,556    n/a Tier 1 capital           16,718    n/a Total capital           20,689    n/a RWA           134,821    n/a Common Equity Tier 1 ratio           11.5 %  n/a Tier 1 capital ratio           12.4 %  n/a Total capital ratio           15.3 %  n/a ACM           17.9 x  n/a Basel III- All-in basis                 Common Equity Tier 1 capital          $12,077    n/a Tier 1 capital           15,179    n/a Total capital           19,352    n/a RWA           126,366    n/a Common Equity Tier 1 ratio           9.6 %  n/a Tier 1 capital ratio           12.0 %  n/a Total capital ratio           15.3 %  n/a Basel II                 Tier 1 capital           n/a  $15,940 (2)Total capital           n/a   19,924 (2)RWA           n/a   115,229  Tier 1 capital ratio           n/a   13.8 %Total capital ratio           n/a   17.3 %ACM           n/a   17.4 x(1) Capital measures for fiscal year 2013 are based on Basel III whereas prior period measures are based on Basel II.(2) Incorporates OSFI's IFRS transitional relief election.  n/a Not applicable.      Effective in the first quarter of 2013, regulatory capital requirements are based on the Basel III methodology, while requirements for the fourth quarter of 2012 were determined on a Basel II basis. As a result of the change in methodology, the regulatory capital information at October 31, 2012 and January 31, 2013 is not comparable.All-in basis(i)On an all-in basis(i) under Basel III, regulatory adjustments are deducted from common equity for the purpose of calculating the new Common Equity Tier 1 ratio. The regulatory adjustments include a broad range of items, such as goodwill, intangible assets, pension assets, deferred tax assets and equity investments in financial entities subject to investment thresholds and limits.RWAs increased from October 31, 2012. This is largely attributable to the implementation of the following Basel III changes:A 1.25 multiplier is applied to the correlation parameter for exposures to financial institutions under the internal ratings based approach subject to certain criteria;Items that were previously deducted from capital under Basel II (such as significant investments in commercial entities and exposures relating to securitization that were deducted from capital) are now risk-weighted at 1,250%;Significant investments in the equity of financial entities and deferred tax assets arising from temporary differences are only deducted if they exceed certain thresholds; the amounts not deducted are risk weighted at 250%; andHigher capital requirements for exposures that give rise to greater degrees of wrong-way risk.Transitional basisUnder Basel III, transitional RWAs differ from RWAs on an all-in basis. On a transitional basis certain deductions from capital will be phased in at 20% per year starting in 2014.  The amount not yet deducted from capital is risk-weighted accordingly.(i) "All-in" is defined by OSFI as capital calculated to include all of the regulatory adjustments that will be required by 2019, but retaining the phase-out rules for non-qualifying capital instruments.Significant capital management activity Normal course issuer bidDuring the quarter, we purchased and cancelled 3,337,300 common shares under the normal course issuer bid at an average price of $80.69 for a total amount of $269 million.Off-balance sheet arrangementsWe 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 with the exception of the commercial mortgage securitization trust.CIBC-sponsored conduitsWe sponsor a single-seller conduit and several multi-seller conduits (collectively, the conduits) in Canada.As at January 31, 2013, the underlying collateral for various asset types in our multi-seller conduits amounted to $1.5 billion (October 31, 2012: $1.6 billion). The estimated weighted-average life of these assets was 1.3 years (October 31, 2012: 9 months). Our holdings of commercial paper issued by our non-consolidated sponsored multi-seller conduits that offer commercial paper to external investors were $15 million (October 31, 2012: $23 million). Our committed backstop liquidity facilities to these conduits were $2.2 billion (October 31, 2012: $2.2 billion). We also provided credit facilities of $30 million (October 31, 2012: $30 million) to these conduits as at January 31, 2013.We participated in a syndicated facility for a 3-year commitment of $575 million to our single-seller conduit that provides funding to franchisees of a major Canadian retailer. Our portion of the commitment was $110 million (October 31, 2012: $110 million). As at January 31, 2013, we funded $81 million (October 31, 2012: $80 million) through the issuance of bankers' acceptances.              2013            2012 $ millions, as at           Jan. 31          Oct. 31          Undrawn          Undrawn           Investment   liquidity  Written   Investment   liquidity  Written        and   and credit  credit   and   and credit  credit        loans(1)  facilities  derivatives(2)  loans(1)  facilities  derivatives(2)CIBC sponsored conduits   $96   $1,464 $ -   $103   $1,554  $-  CIBC structured CDO vehicles    229    42   210    232    40   207  Third-party structured vehicles                         Structured credit run-off    4,449    370   3,509    4,313    333   4,382   Continuing    765    25   -    1,004    23   -  Pass-through investment structures    2,716    -   -    2,182    -   -  Commercial mortgage securitization trust    2    -   -    1    -   -  (1) Excludes securities issued by, retained interest in, and derivatives with entities established by CMHC, Federal National Mortgage Association (Fannie Mae), Federal Home Loan Mortgage Corporation (Freddie Mac), Government National Mortgage Association (Ginnie Mae), Federal Home Loan Banks, Federal Farm Credit Bank, and Student Loan Marketing Association (Sallie Mae). $3.8 billion (October 31, 2012: $3.7 billion) of the exposures related to CIBC-structured vehicles and third-party structured vehicles - structured credit run-off were hedged.(2) The negative fair value recorded on the interim consolidated balance sheet was $486 million (October 31, 2012: $1.2 billion). Notional of $3.3 billion (October 31, 2012: $3.3 billion) was hedged with credit derivatives protection from third parties. The fair value of these hedges net of CVA was $277 million (October 31, 2012: $307 million). An additional notional of $198 million (October 31, 2012: $1.0 billion) was hedged through a limited recourse note. Accumulated fair value losses were $24 million (October 31, 2012: $26 million) on unhedged written credit derivatives.       Additional details of our structured entities are provided in Note 5 to the interim consolidated financial statements. Details of our other off-balance sheet arrangements are provided on pages 39 to 41 of the 2012 Annual Report. Management of riskOur approach to management of risk has not changed significantly from that described on pages 42 to 68 of the 2012 Annual Report. Certain disclosures in this section have been shaded as they are required under IFRS 7 "Financial Instruments - Disclosures" and form an integral part of the interim consolidated financial statements.Risk overviewWe manage risk and related balance sheet resources within tolerance levels established by our management committees and approved by the Board of Directors and its committees. Key risk management policies are reviewed and approved by the applicable Board and management committees annually. Further details on the Board and management committees, as applicable to the management of risk, are provided on pages 42 and 43 of the 2012 Annual Report.The five key groups within Risk Management, independent of the originating businesses, contribute to our management of risk:Capital Markets Risk Management - This unit provides independent oversight of the measurement, monitoring and control of market risks (both trading and non-trading), trading credit risk and trading operational risk across CIBC's portfolios;Card Products Risk Management - This unit oversees the management of credit risk in the card products portfolio, including the optimization of credit portfolio quality;Retail Lending and Wealth Risk Management - This unit primarily oversees the management of credit and fraud risk in the retail lines of credit and loans, residential mortgage, and small business loan portfolios, including the optimization of credit portfolio quality. This unit is also responsible for overall risk management oversight of wealth management activities;Wholesale Credit and Investment Risk Management - This unit is responsible for the adjudication and oversight of credit risks associated with our commercial and wholesale lending activities globally, management of the risks of our investment portfolios, as well as management of the special loans portfolios; andRisk Services - This unit is responsible for enterprise-wide analysis and reporting. Risk Services is also responsible for economic capital methodologies and policies, and CIBC's operational risk framework.Liquidity, funding and interest rate risks are managed by Treasury. The measurement, monitoring and control of these risks are addressed in collaboration with Risk Management, with oversight provided by the Asset Liability Committee (ALCO).Credit riskCredit risk primarily arises from our direct lending, trading, investment and hedging activities. Credit risk is defined as the risk of financial loss due to a borrower or counterparty failing to meet its obligations in accordance with contractual terms.Exposure to credit risk              2013   2012$ millions, as at    Jan. 31   Oct. 31Business and government portfolios-advanced internal ratings-based (AIRB) approach         Drawn   $78,123   $75,666 Undrawn commitments    33,251    33,208 Repo-style transactions    47,119    56,938 Other off-balance sheet    54,115    52,322 Over-the-counter (OTC) derivatives    14,398    14,426 Gross exposure at default (EAD) on business and government portfolios    227,006    232,560 Less: repo collateral    37,381    48,152 Net EAD on business and government portfolios    189,625    184,408 Retail portfolios-AIRB approach          Drawn    193,113    194,586 Undrawn commitments    60,219    69,778 Other off-balance sheet    345    370 Gross EAD on retail portfolios    253,677    264,734 Standardized portfolios    11,667    11,808 Securitization exposures    18,872    19,003 Gross EAD   $511,222   $528,105 Net EAD   $473,841   $479,953           Real estate secured personal lendingReal estate secured personal lending comprises residential mortgages and personal loans and lines secured by residential property (HELOC). This portfolio is low risk where we have a first charge on the majority of the properties, and second lien on only a small portion of the portfolio. We use the same lending criteria in the adjudication of both first lien and second lien loans.Under the Bank Act, banks are limited to providing residential real estate loans of no more than 80% of the collateral value. An exception is made for loans with a higher loan-to-value (LTV) ratio if they are insured by either Canada Mortgage and Housing Corporation (CMHC) or a private mortgage insurer. Mortgage insurance protects banks from the risk of default by the borrower, over the term of the coverage. Private mortgage insurers are subject to regulatory capital requirements, which aim to ensure that they are well capitalized.  If a private mortgage insurer becomes insolvent, the Government of Canada has, provided certain conditions are met, obligations in respect of policies underwritten by certain insolvent private mortgage insurers as more fully described in the recently enacted Protection of Residential Mortgage or Hypothecary Insurance Act (PRMHIA).  There is a possibility that losses could be incurred in respect of insured mortgages if, among other things, CMHC or the applicable private mortgage insurer denies a claim, or further, if a private mortgage insurer becomes insolvent and either the conditions under the PRMHIA are not met or the Government of Canada denies the claim.  No material losses are expected in the mortgage portfolio.The following table provides details on our Canadian residential mortgage and HELOC portfolios:     Residential mortgages HELOC (1) Total$ billions, as at January 31, 2013      Insured(2)  Uninsured   Uninsured     Insured(2)  Uninsured Ontario   $49.0   74 % $16.8   26 % $9.5   100 % $49.0   65 % $26.3   35 %British Columbia    20.8   73    7.7   27    4.0   100    20.8   64    11.7   36  Alberta    18.1   77    5.3   23    3.0   100    18.1   69    8.3   31  Quebec    8.4   81    2.0   19    1.5   100    8.4   71    3.5   29  Other    12.6   82    2.8   18    1.9   100    12.6   73    4.7   27  Total Canadian portfolio    108.9   76    34.6   24    19.9   100    108.9   67    54.5   33  October 31, 2012   $109.5   76 % $34.8   24 % $20.1   100 % $109.5   67 % $54.9   33 %(1) We did not have any insured HELOCs as at January 31, 2013 and October 31, 2012. (2) 93% (October 31, 2012: 93%) is insured by CMHC and the remaining by two private Canadian insurers, both rated at least AA (low) by DBRS.     The average LTV ratio(1) for our Canadian uninsured residential mortgages and HELOCs portfolios originated during the quarter are provided in the following table. We did not acquire uninsured residential mortgages and HELOCs from a third party for the periods presented in the table below. For the three months ended January 31, 2013 Residential mortgages  HELOC  Ontario 67 % 66 %British Columbia 63   60  Alberta 68   66  Quebec 69   67  Other 70   66  Total Canadian portfolio 67 % 64 %October 31, 2012 64 % 61 %January 31, 2012 62 % 59 %(1)Based on house price at origination. The following table provides details on the average LTV ratio on our total Canadian residential mortgage portfolio:  Insured Uninsured January 31, 2013 (1)48 %51 %October 31, 2012 (2)48 %50 %(1)Based on latest available industry house price estimates from Teranet (December 31, 2012). (2)Based on industry house price estimates from Teranet (September 30, 2012).The tables below summarize the remaining amortization profile of our Canadian residential mortgages. The first table provides the remaining amortization periods based on the minimum contractual payment amounts. The second table provides the remaining amortization periods based upon current customer payment amounts, which incorporate payments larger than the minimum contractual amount and/or higher frequency of payments. Contractual payment basis   Less than             35 years  5 years 5-10 years 10-15 years 15-20 years 20-25 years 25-30 years 30-35 years and above January 31, 20131 %1 %3 %13 %20 %29 %30 %3 %October 31, 20121 %1 %3 %13 %21 %27 %31 %3 %Current customer payment basis Less than             35 years  5 years 5-10 years 10-15 years 15-20 years 20-25 years 25-30 years 30-35 years and above January 31, 20133 %7 %12 %16 %20 %25 %15 %2 %October 31, 20123 %7 %12 %16 %20 %26 %14 %2 % We have two types of condominium exposures in Canada: mortgages and developer loans. Both are primarily concentrated in the Toronto and Vancouver areas. As at January 31, 2013, our Canadian condominium mortgages were $16.8 billion (October 31, 2012: $17.0 billion) of which 77% (October 31, 2012: 77%) were insured. Our drawn developer loans were $789 million (October 31, 2012: $701 million) or 1% of our business and government portfolio and our related undrawn exposure was $2.0 billion (October 31, 2012: $2.0 billion). The condominium developer exposure is diversified across 73 projects.We stress test our mortgage and HELOC portfolio to determine the potential impact of different economic events. Our stress tests can use variables such as GDP, unemployment, bankruptcy rates, debt service ratios and delinquency trends, which are reflective of potential ranges of housing price declines, to model potential outcomes for a given set of circumstances. The stress testing involves variables that could behave differently in certain situations. Our main tests use economic variables in a similar range to the early 1980s and early 1990s when Canada experienced economic downturns. Our results show that in an economic downturn, our strong capital position should be sufficient to absorb mortgage and HELOC losses.Counterparty credit exposureWe have counterparty credit exposure that arises from our interest rate, foreign exchange, equity, commodity, and credit derivatives trading, hedging, and portfolio management activities, as explained in Note 12 to the consolidated financial statements in our 2012 Annual Report.We establish a CVA for expected future credit losses from each of our derivative counterparties. As at January 31, 2013, the CVA for all derivative counterparties was $97 million (October 31, 2012: $137 million).The following table shows the rating profile of OTC derivative MTM receivables (after CVA and derivative master netting agreements but before any collateral).     2013    2012 $ billions, as at   Jan. 31    Oct. 31 S&P rating equivalent Exposure AAA to BBB-$4.21  83.6 %$5.46  81.4 % BB+ to B- 0.82  16.3   1.22  18.2   CCC+ to CCC- -  -   0.02  0.2   Below CCC- -  -   0.01  0.1   Unrated 0.01  0.1   0.01  0.1    $5.04  100.0 %$6.72  100.0 %            The following table provides the details of our impaired loans and allowances for credit losses:    2013 2012$ millions, as at Jan. 31 Oct. 31Gross impaired loans    Consumer$757 $739 Business and government 992  1,128 Total gross impaired loans$1,749 $1,867 Allowance for credit losses    Consumer$1,121 $1,121 Business and government 699  739 Total allowance for credit losses$1,820 $1,860 Comprises:    Individual allowance for loans$446 $475 Collective allowance for loans (1) 1,374  1,385 Total allowance for credit losses$1,820 $1,860  (1)Excludes allowance on undrawn credit facilities of $61 million (October 31, 2012: $56 million).   Gross impaired loans (GIL) were down $118 million or 6% from October 31, 2012. Consumer GIL was up $18 million or 2%, mainly driven by residential mortgages and personal lending. Business and government GIL was down $136 million or 12%, attributable to decreases in the publishing, printing and broadcasting, and oil and gas sectors.The total allowance for credit losses was down $40 million or 2% from October 31, 2012. Canadian and U.S. allowances for credit losses comprise 71% and 12%, respectively, of the total allowance. The individually assessed allowance was down $29 million or 6% from October 31, 2012, mainly driven by the oil and gas sector. The collectively assessed allowance was down $11 million or 1% from October 31, 2012, largely driven by an improvement in the cards portfolio.For details on the provision for credit losses, see the "Overview" section.Exposure to certain countries and regionsSeveral European countries, especially Greece, Ireland, Italy, Portugal, and Spain, have continued to experience credit concerns. The following tables provide our exposure to these and other European countries, both within and outside the Eurozone. Except as noted in our indirect exposures section below, we do not have any other exposure through our special purpose entities (SPEs) to the countries included in the tables below.We do not have a material exposure to the countries in the Middle East and North Africa that have either experienced or may be at risk of unrest. These countries include Algeria, Bahrain, Egypt, Jordan, Lebanon, Libya, Morocco, Oman, Saudi Arabia, Syria, Tunisia, and Yemen.Direct exposures to certain countries and regionsOur direct exposures presented in the tables below comprise (A) funded - on-balance sheet loans (stated at amortized cost net of allowances, if any), deposits with banks (stated at amortized cost net of allowances, if any) and securities (stated at fair value); (B) unfunded - unutilized credit commitments, letters of credit, and guarantees (stated at notional amount net of allowances, if any) and sold credit default swap (CDS) contracts where we do not benefit from subordination (stated at notional amount less fair value); and (C) derivative MTM receivables (stated at fair value) and repo-style transactions (1) (stated at fair value). Of our total direct exposures to Europe, approximately 97% (October 31, 2012: 98%) is to entities in countries with Aaa/AAA ratings from at least one of Moody's or S&P.The following tables provide a summary of our positions in this business:   Direct exposures    Funded  Unfunded            Total         Total       funded     unfunded$ millions, as at January 31, 2013Corporate  Sovereign    Bank  (A) Corporate     Bank (B)Austria$- $75 $- $75  $-  $- $- Belgium 4  -  30  34   -   -  - Finland 1  -  2  3   -   -  - France 48  -  5  53   11   6  17 Germany 220  42  12  274   69   -  69 Greece 2  -  -  2   -   -  - Ireland -  -  -  -   -   -  - Italy -  -  -  -   -   1  1 Luxembourg 1  -  51  52   -   -  - Malta -  -  -  -   -   -  - Netherlands 9  219  65  293   -   10  10 Portugal -  -  -  -   -   -  - Spain -  -  1  1   -   -  - Total Eurozone$285 $336 $166 $787  $80  $17 $97 Denmark -  3  26  29   -   13  13 Guernsey -  -  -  -   -   -  - Norway -  96  116  212   -   -  - Russia -  -  -  -   -   -  - Sweden 160  93  259  512   43   -  43 Switzerland 248  -  124  372   303   -  303 Turkey -  -  15  15   -   2  2 United Kingdom 617  269  645  1,531   1,202 (2) 65  1,267 Total non-Eurozone$1,025 $461 $1,185 $2,671  $1,548  $80 $1,628 Total Europe$1,310 $797 $1,351 $3,458  $1,628  $97 $1,725 October 31, 2012$1,141 $863 $1,287 $3,291  $1,397  $190 $1,587 (1)Comprises securities purchased and sold under repurchase agreements for cash collateral; securities borrowed and lent for cash collateral; and securities borrowed and lent for securities collateral.(2)Includes $144 million of exposure (notional value of $181 million and fair value of $37 million) on a CDS sold on a bond issue of a U.K. corporate entity, which is guaranteed by a financial guarantor. We currently hold the CDS sold as part of our structured credit run-off business. A payout on the CDS sold would be triggered by the bankruptcy of the reference entity, or a failure of the entity to make a principal or interest payment as it is due; as well as failure of the financial guarantor to meet its obligation under the guarantee. Direct exposures (continued) Derivative MTM receivables and repo-style transactions  Total              Net direct        Gross  Collateral  exposure exposure$ millions, as at January 31, 2013 Corporate Sovereign Bank exposure(1) held(2) (C) (A)+(B)+(C)Austria$- $- $32 $32  $32  $- $75 Belgium -  1  43  44   43   1  35 Finland -  -  7  7   -   7  10 France -  298  641  939   931   8  78 Germany -  -  1,384  1,384   1,179   205  548 Greece -  -  -  -   -   -  2 Ireland -  -  231  231   221   10  10 Italy -  -  28  28   24   4  5 Luxembourg -  -  1  1   -   1  53 Malta -  -  1  1   -   1  1 Netherlands -  -  227  227   213   14  317 Portugal -  -  -  -   -   -  - Spain -  -  4  4   4   -  1 Total Eurozone$- $299 $2,599 $2,898  $2,647  $251 $1,135 Denmark -  -  17  17   14   3  45 Guernsey -  -  -  -   -   -  - Norway -  591  -  591   591   -  212 Russia -  -  6  6   -   6  6 Sweden 1  -  1  2   1   1  556 Switzerland -  -  1,127  1,127   1,118   9  684 Turkey -  -  -  -   -   -  17 United Kingdom 96  -  3,234  3,330   3,222   108  2,906 Total non-Eurozone$97 $591 $4,385 $5,073  $4,946  $127 $4,426 Total Europe$97 $890 $6,984 $7,971  $7,593  $378 $5,561 October 31, 2012$73 $- $6,078 $6,151  $5,790  $361 $5,239 (1)The amounts are shown net of CVA. (2)Collateral on derivative MTM receivables was $2.3 billion (October 31, 2012: $2.3 billion), and was all in the form of cash. Collateral on repo-style transactions was $5.3 billion (October 31, 2012: $3.5 billion), and is comprised of cash and investment-grade debt securities. Indirect exposures to certain countries and regionsOur indirect exposures comprise securities (primarily CLOs classified as loans on our consolidated balance sheet), and written credit protection on securities in our structured credit run-off business where we benefit from subordination to our position. Our gross exposure before subordination is stated at carrying value for securities and notional less fair value for derivatives where we have written protection. We have no indirect exposures to Portugal, Slovenia, Guernsey, Turkey, and Russia.   Total   indirect$ millions, as at January 31, 2013  exposureAustria $1 Belgium  40 Finland  13 France  551 Germany  402 Greece  10 Ireland  50 Italy  68 Luxembourg  52 Netherlands  301 Spain  153 Total Eurozone $1,641 Denmark $38 Norway  14 Sweden  78 Switzerland  4 United Kingdom  624 Total non-Eurozone $758 Total exposure $2,399 October 31, 2012 $2,452    In addition to the indirect exposures above, we have indirect exposures to European counterparties when we have taken debt or equity securities issued by European entities as collateral for our securities lending and borrowing activity, from entities that are not in Europe. Our indirect exposure was $407 million (October 31, 2012: $846 million).Selected exposures in certain selected activitiesIn response to the recommendations of the Financial Stability Board, this section provides information on our other selected activities within our continuing and exited businesses that may be of particular interest to investors based on their risk characteristics and the current market environment. For additional information on these selected exposures, refer to pages 56 to 57 of the 2012 Annual Report.U.S. real estate finance The following table provides a summary of our positions in this business: $ millions, as at January 31, 2013Drawn Undrawn Construction program$162 $89 Interim program 3,804  304 Permanent program 106  - Exposure, net of allowance$4,072 $393 Of the above:     Net impaired$109 $-  On credit watch list 260  2 Exposure, net of allowance, as at October 31, 2012$4,177 $445 As at January 31, 2013, the allowance for credit losses for this portfolio was $109 million (October 31, 2012: $118 million). During the quarter ended January 31, 2013, we recorded provision for credit losses of $9 million ($26 million for the quarter ended January 31, 2012).The business also maintains commercial mortgage-backed securities (CMBS) trading and distribution capabilities. As at January 31, 2013, we had CMBS inventory with a notional amount of $9 million and a fair value of less than $1 million (October 31, 2012: notional of $9 million and fair value of less than $1 million).Leveraged financeThe exposures in our leveraged finance activities in Europe and U.S. are discussed below.European leveraged financeThe following table provides a summary of our positions in this exited business:$ millions, as at January 31, 2013DrawnUndrawn Manufacturing$334 $62 Publishing and printing 40  1 Utilities 9  - Business services 6  - Transportation 7  10 Exposure, net of allowance$396 $73 Of the above:     Net impaired$- $-  On credit watch list 199  8 Exposure, net of allowance, as at October 31, 2012$404 $60 As at January 31, 2013, the allowance for credit losses for this portfolio was $41 million (October 31, 2012: $41 million). The net provision for credit losses was nil for the quarters ended January 31, 2013 and January 31, 2012.U.S. leveraged finance The following table provides a summary of our positions in this business:$ millions, as at January 31, 2013DrawnUndrawn Transportation$65 $16 Media and advertising 9  - Manufacturing 3  3 Exposure, net of allowance$77 $19 Of the above:     Net impaired$36 $-  On credit watch list 38  13 Exposure, net of allowance, as at October 31, 2012$91 $19 As at January 31, 2013, the allowance for credit losses for this portfolio was $65 million (October 31, 2012: $67 million). During the quarter, the net reversal of credit losses was $1 million (nil for the quarter ended January 31, 2012).Market riskMarket risk arises from positions in currencies, securities and derivatives held in our trading portfolios, and from our retail banking business, investment portfolios, and other non-trading activities. Market risk is defined as the potential for financial loss from adverse changes in underlying market factors, including interest and foreign exchange rates, credit spreads, and equity and commodity prices.Trading activitiesThe following three tables show VaR, stressed VaR and Incremental risk charge for our trading activities based on risk type under an internal models-based approach.Trading revenue (TEB) comprises both trading net interest income and non-interest income and excludes underwriting fees and commissions. Trading revenue (TEB) for the purposes of these tables excludes positions described in the "Structured credit run-off business" section of the MD&A and certain other exited portfolios.Total average VaR for the three months ended January 31, 2013 was down 9% from the last quarter, driven mainly by a decrease in our equity risk, offset by an increase in interest rate risk.Average stressed VaR for the three months ended January 31, 2013 was up 71% from the last quarter. During the current stressed VaR period from March 6, 2008 to March 5, 2009, the market exhibited increased interest rate volatility combined with a reduction in the level of interest rates, and an increase in credit spreads.Average incremental risk charge for the three months ended January 31, 2013 was up 35% from the last quarter, mainly due to increased trading inventory in the high-yield fixed income business.VaR by risk type - trading portfolio         2013   2012     2012$ millions, as at or for the three months ended       Jan. 31   Oct. 31   Jan. 31  High Low As at Average   As at Average   As at Average  Interest rate risk$5.2 $1.0 $3.7 $3.0 $2.1 $1.8 $1.9 $1.9 Credit spread risk 2.6  1.2  1.8  1.7  1.4  1.6  0.9  1.1 Equity risk 2.4  2.0  2.2  2.2  2.0  3.8  1.8  1.8 Foreign exchange risk 1.3  0.2  1.3  0.5  0.7  0.6  0.5  0.7 Commodity risk 1.5  0.7  0.8  1.0  1.0  1.1  1.4  1.0 Debt specific risk 3.6  1.9  2.4  2.6  2.1  2.6  2.0  2.5 Diversification effect (1) n/m n/m (7.3) (6.0) (5.2) (6.0) (5.0) (5.0)Total VaR (one-day measure)$6.1 $4.0 $4.9 $5.0 $4.1 $5.5 $3.5 $4.0(1)Total VaR is less than the sum of the VaR of the different market risk types due to risk offsets resulting from portfolio diversification effect.n/mNot meaningful. It is not meaningful to compute a diversification effect because the high and low may occur on different days for different risk types. Stressed VaR by risk type - trading portfolio         2013   2012   2012$ millions, as at or for the three months ended        Jan. 31   Oct. 31   Jan. 31  High Low As at Average   As at Average   As at Average  Interest rate risk$21.1 $4.9 $8.9 $9.5 $8.3 $7.2 $4.7 $6.8 Credit spread risk 6.3  3.9  6.0  5.1  3.8  3.4  1.7  2.5 Equity risk 12.7  1.0  1.3  3.1  1.2  2.5  1.4  1.9 Foreign exchange risk 5.6  0.3  1.9  1.7  0.6  1.5  2.1  1.8 Commodity risk 4.0  0.4  0.4  1.3  1.3  0.8  0.9  1.1 Debt specific risk 2.1  0.7  1.4  1.5  0.9  1.0  1.0  1.1 Diversification effect (1) n/m n/m (9.4) (10.4) (6.5) (9.5) (7.7) (9.1)Total stressed VaR (one-day measure)$21.3 $6.3 $10.5 $11.8 $9.6 $6.9 $4.1 $6.1(1)Total stressed VaR is less than the sum of the VaR of the different market risk types due to risk offsets resulting from portfolio diversification effect.n/mNot meaningful. It is not meaningful to compute a diversification effect because the high and low may occur on different days for different risk types.Incremental risk charge - trading portfolio        2013   2012   2012$ millions, as at or for the three months ended       Jan. 31   Oct. 31   Jan. 31  High Low As at Average   As at Average As at AverageDefault risk$77.8 $33.7 $36.0 $51.7 $28.8 $31.6 $28.6 $27.8 Migration risk 51.6  35.6  40.4  41.9  42.1  37.8  26.9  44.4 Incremental risk charge (one-year measure)$115.2 $76.3 $76.4 $93.6 $70.9 $69.4 $55.5 $72.2  Trading revenueThe trading revenue (TEB) and VaR graph below compares the current quarter and the three previous quarters' actual daily trading revenue (TEB) with the previous day's VaR measures.During the quarter, trading revenue (TEB)was positive each day. The largest gain of $14.6 million occurred on January 22, 2013. It was attributable to the normal course of business within our capital markets group, notably in the equity derivatives business. Average daily trading revenue (TEB) was $3.4 million during the quarter and the average daily TEB was $1.5 million.Trading revenue (TEB) versus VaRhttp://files.newswire.ca/256/TEBvVarCIBC2013.JPGNon-trading activitiesInterest rate riskNon-trading interest rate risk consists primarily of risk inherent in asset/liability management activities and the activities of domestic and foreign subsidiaries. Interest rate risk results from differences in the maturities or repricing dates of assets and liabilities, both on- and off-balance sheet, as well as from embedded optionality in retail products. This optionality arises predominantly from the prepayment exposures of mortgage products, mortgage commitments and some GIC products with early redemption features; this optionality is measured consistent with our actual experience. A variety of cash instruments and derivatives, principally interest rate swaps, futures and options, are used to manage and control these risks.The following table shows the potential impact over the next 12 months, adjusted for structural assumptions (excluding shareholders' equity), estimated prepayments and early withdrawals, of an immediate 100 and 200 basis point increase or decrease in interest rates. In addition, we have a floor in place in the downward shock to accommodate for the current low interest rate environment (i.e. analysis uses the floor to stop interest rates from going into a negative position in the lower rate scenarios).Interest rate sensitivity - non-trading (after-tax)      2013     2012     2012  $ millions, as at     Jan. 31     Oct. 31     Jan. 31      C$ US$ Other   C$ US$ Other   C$ US$ Other  100 basis points increase in interest rates                  Increase (decrease) in net incomeattributable to equity shareholders$109 $(14)$3 $101 $(21)$1 $145 $(11)$2 Decrease in present value of shareholders' equity (35) (145) (42) (99) (170) (43) (47) (63) (38)100 basis points decrease in interest rates                  Increase (decrease) in net income attributable to equity shareholders (169) 7  (2) (180) 7  -  (209) 6  (2)Decrease (increase) in present value of shareholders' equity (58) 110  43  3  115  44  (53) 41  38 200 basis points increase in interest rates                  Increase (decrease) in net income attributable to equity shareholders$202 $(28)$7 $206 $(43)$2 $308 $(22)$5 Decrease in present value of shareholders' equity (122) (290) (84) (252) (339) (85) (132) (127) (75)200 basis points decrease in interest rates                  Increase (decrease) in net income attributable to equity shareholders (330) 1  (5) (358) (1) (1) (324) 5  (5)Decrease (increase) in present value of shareholders' equity (268) 137  68  (181) 127  69  (213) 38  56 Liquidity riskLiquidity risk is the risk of having insufficient cash resources to meet financial obligations as they fall due, in their full amount and stipulated currencies, without raising funds at adverse rates or selling assets on a forced basis.Our liquidity risk management strategies seek to maintain sufficient liquid financial resources and diversified funding sources to continually fund our balance sheet and contingent obligations under both normal and stressed market environments.Liquidity risk governance and managementThe liquidity risk governance and management structure at CIBC comprises the Risk Management Committee of the Board (RMC), ALCO and the Office of the Treasurer.The ongoing management of liquidity risk is the responsibility of the Treasurer, supported by guidance from ALCO. The RMC provides governance through approval of CIBC's liquidity risk framework that includes the policies, procedures, limits and independent monitoring structures. RMC's responsibilities include:Defining CIBC's liquidity risk tolerance through the Risk Appetite Statement;Establishing limits for the primary liquidity risk metric, the Liquidity Horizon, and unsecured wholesale funding;Reviewing and approving the Liquidity Policy and the Contingency Funding Plan (CFP);Reviewing and approving CIBC's liquidity profile; andReviewing and approving the liquidity stress scenario.ALCO's responsibilities include:Ensuring that CIBC's liquidity profile is managed consistent with the strategic, stated risk appetite and regulatory requirements;Monitoring reporting and metrics relating to liquidity risk exposure, such as, Liquidity Horizon, funding profile and liquid asset portfolio;Reviewing and setting the Liquidity Horizon management limit;Reviewing, on a periodic basis, the liquidity stress scenario used to measure liquidity risk exposure; andReviewing and approving the funding plan.The Treasurer is responsible for managing the activities and processes required for measurement, reporting and monitoring of CIBC's liquidity risk position and ensuring compliance within RMC, ALCO and regulatory constraints.PoliciesCIBC's liquidity policy and framework ensures a sufficient amount of unencumbered liquid assets are available to meet anticipated liquidity needs in both stable and stressed conditions for a minimum period of time as determined by the RMC.Alongside the liquidity risk management framework, our enterprise-wide pledging policy sets out consolidated aggregate net maximum pledge limits for financial and non-financial assets. Pledged assets are considered encumbered and therefore unavailable for liquidity purposes.CIBC maintains and periodically updates a detailed CFP for responding to liquidity stress events. The plan is presented annually to the RMC.Process and controlCIBC manages liquidity risk in a manner that enables it to withstand a liquidity crisis without an adverse impact on the viability of its operations. Actual and anticipated inflows and outflows of funds generated from on- and off-balance sheet exposures are measured and monitored on a daily basis to ensure compliance with the established limits. Short-term asset and liability mismatch limits are set by geographic location and consolidated for overall global exposure. Contractual and behavioural on-balance sheet and off-balance sheet cash flows under normal and stressed conditions are modeled and used to determine liquidity levels to be maintained for a minimum time horizon.The RMC is regularly informed of current and prospective liquidity conditions, ongoing monitoring measures and the implementation of enhanced measurement tools.Risk measurementCIBC's policy is to maintain a sound and prudent approach to managing its potential exposure to liquidity risk. CIBC's liquidity risk tolerance is defined by its Risk Appetite Statement, approved annually by the Board of Directors, which forms the basis for the delegation of liquidity risk authority to senior management. The primary liquidity risk metric used to measure and monitor CIBC's liquidity position is the Liquidity Horizon, the future point in time when projected cumulative cash outflows exceed cash inflows under a predefined liquidity stress scenario, without any reliance on the CFP. Our liquidity measurement system provides daily liquidity risk exposure reports that include the calculation of the Liquidity Horizon against the prescribed management target for review by senior management.  CIBC's liquidity risk framework also incorporates the monitoring of the unsecured wholesale funding position and funding capacity, as well as regulatory mandated metrics such as the Liquidity Coverage Ratio (LCR) and the Net Cumulative Cash Flow (NCCF). ALCO monitors CIBC's current and prospective liquidity position in relation to risk appetite and limits.A key component of the liquidity risk framework at CIBC is the liquidity risk stress testing regime. Liquidity risk stress testing is conducted daily and involves the application of a severe, name-specific and market-wide stress scenario to determine the amount of liquidity required to satisfy anticipated obligations as they come due. The scenario models potential liquidity and funding requirements in the event of unsecured wholesale funding and deposit runoff, expected contingent liquidity utilization, as well as liquid asset marketability. In addition to this CIBC-specific event, the stress scenario incorporates the impact of market-wide liquidity stress that results in significant reduction in access to both short and long-term funding and a decrease in marketability and price of assets.Stress scenario assumptions are subject to periodic review and approval, at least annually, by the RMC.Liquid assetsCIBC's policy is to hold a pool of high quality unencumbered liquid assets that will be immediately available to meet outflows determined under the stress scenario. Liquid assets are cash, short-term bank deposits and high-quality marketable securities that can be readily pledged at central banks and in repo markets or converted into cash in a timely fashion. Encumbered assets include those liquid assets that have been pledged for collateral management purposes as well as restricted cash and deposits with banks.Liquid assets net of encumbrances constitute our unencumbered pool of liquid assets, and are summarized in the following table:  Jan. 31 Oct. 31 $ millions, as at 2013 2012(1)Cash and deposits with banks (2)$1,631 $1,507  Securities (3) 65,351  63,882  NHA mortgage-backed securities (4) 20,583  19,187  Securities purchased under resale agreements 25,581  25,163  Cash collateral on securities borrowed 3,477  3,311  Total liquid assets 116,623  113,050  Encumbered liquid assets(5) 20,515  22,977  Unencumbered liquid assets$96,108 $90,073  (1)Certain information has been reclassified to conform to the presentation adopted in the current period. (2)Includes cash, non-interest bearing deposits and interest-bearing deposits with contractual maturities of less than 30 days. (3)Includes all trading, AFS and FVO securities other than the securities in our structured credit run-off business and private equity securities. (4)Reported in loans on our interim consolidated balance sheet. (5)Excludes interday pledges to the Bank of Canada related to the Large Value Transfer System as these are normally released to us at the end of the settlement cycle each day.CIBC's unencumbered liquid asset position increased by $6.0 billion or 7% from October 31, 2012. The change was primarily due to increases in AFS, trading and NHA mortgage-backed securities, and a decrease in our obligations related to securities sold under repurchase agreements (included in encumbered liquid assets).CIBC's total pledged assets, which include encumbered liquid assets presented in the table above, totalled $66.6 billion as at January 31, 2013 (October 31, 2012: $64.9 billion). These pledged assets are used primarily for securities lending and borrowing activities, secured borrowings, derivative transactions, and other clearing and settlement of payments and securities.The following table summarizes unencumbered liquid assets held by CIBC parent bank and significant subsidiaries:  Jan. 31 Oct. 31$ millions, as at 2013 2012CIBC parent bank$67,788 $63,800 Broker/dealer 18,561  15,940 Other significant subsidiaries 9,759  10,333  $96,108 $90,073 Restrictions on the flow of fundsCIBC has certain subsidiaries that have separate regulatory capital and liquidity requirements, as established by banking and securities regulators. Requirements of these entities are subject to regulatory change and can fluctuate depending on activity.CIBC monitors and manages its capital and liquidity requirements across these entities to ensure that capital is used efficiently and that each entity is in compliance with local regulations.Funding CIBC manages liquidity to meet both short and long-term cash requirements. Reliance on short-term wholesale funding is maintained at prudent levels, consistent with CIBC's desired liquidity profile.CIBC's funding strategy includes access to funding through retail deposits and wholesale funding and deposits.  Personal deposits are a significant source of funding and totalled $119.1 billion as at January 31, 2013 (October 31, 2012: $118.2 billion). Our liquidity management framework applies deposit run-off assumptions, under a severe combined stress scenario, to determine core deposits.CIBC's wholesale funding strategy is to develop and maintain a sustainable funding base through which CIBC can access funding across many different depositors and investors, geographies, maturities, and funding instruments.  The diversity of our funding profile across all of these variables is an important part of our funding strategy.  CIBC maintains access to term wholesale funding through many channels such as wholesale deposits in Canada and the U.S., medium-term note programs in Canada, the U.S. and Europe, through our covered bond programme, through credit card securitization in Canada and the U.S., and through a number of mortgage securitization programs, as outlined in the tables below.The following table provides the contractual maturities at carrying values of funding sourced by CIBC from the wholesale market:     Less than 1 - 3 3 - 6 6 - 12 1 - 2 Over  $ millions, as at January 31, 2013 1 month months months months years 2 years TotalDeposits from banks$1,568 $1,243 $271 $- $- $- $3,082 Bearer deposit notes, certificates of deposit and bankers' acceptances 4,520  3,099  1,663  956  833  5,566  16,637 Deposit and medium-term notes 680  3,835  4,878  12,095  6,319  15,227  43,034 Subordinated indebtedness -  -  -  -  285  4,506  4,791 Mortgage securitization -  -  1,620  8,739  5,947  16,828  33,134 Covered bonds 2,453  -  -  754  5,154  5,467  13,828 Cards securitization -  103  926  837  1,491  2,597  5,954      $9,221 $8,280 $9,358 $23,381 $20,029 $50,191 $120,460  Comprises:                  Unsecured$6,768 $8,177 $6,812 $13,051 $7,437 $25,299 $67,544   Secured 2,453  103  2,546  10,330  12,592  24,892  52,916      $9,221 $8,280 $9,358 $23,381 $20,029 $50,191 $120,460 October 31, 2012(1)$6,608 $8,117 $10,346 $17,121 $22,182 $51,526 $115,900 (1)Certain information has been reclassified to conform to the presentation adopted in the current period. The following table provides a currency breakdown, in Canadian dollar equivalent, of funding sourced by CIBC in the wholesale market:   Jan. 31   Oct. 31 $ billions, as at  2013   2012 CAD$69.0 57 %$67.3 58 %USD 45.8 38   41.2 36  EUR 0.1 -  0.1 - Other 5.6 5   7.3 6   $120.5 100 %$115.9 100 %Funding planCIBC's funding plan horizon is three years and is updated at least quarterly, or in response to material changes in underlying assumptions. The plan incorporates projected assets and liability growth from CIBC's planning process, as well as expected funding maturities and inputs from the liquidity stress testing model. The funding plan is reviewed and approved by the ALCO.Credit ratingsAccess to wholesale funding sources and the cost of funds are dependent on various factors including credit ratings. On October 26, 2012, Moody's placed on review for downgrade the long-term debt and deposit ratings of six Canadian financial institutions including CIBC. Moody's cited as their principal concerns: (i) high consumer debt levels and elevated housing prices; (ii) system-wide downside risks to the economic environment; and (iii) their assessment of the risks inherent in the banks' capital markets activities. Subsequently, on January 28, 2013, Moody's downgraded the long-term credit ratings of six Canadian financial institutions, including CIBC, by one notch. CIBC's long-term rating was adjusted from Aa2 to Aa3 and has had no material impact on funding costs or our ability to access funding.CIBC's funding and liquidity levels remained stable and sound over the quarter and we do not anticipate any events, commitments or demands which will materially impact our liquidity risk position.Impact on collateral if there is a downgrade of CIBC's credit ratingWe are required to deliver collateral to certain derivative counterparties in the event of a downgrade to our current credit risk rating. The collateral requirement is based on MTM exposure, collateral valuations, and collateral arrangement thresholds as applicable. The following table presents the additional collateral requirements (cumulative) for rating downgrades:    Jan. 31 Oct. 31$ billions, as at 2013 2012One-notch downgrade$0.1 $0.1 Two-notch downgrade 1.2  1.5 Three-notch downgrade 2.3  2.6 Regulatory developments There is ongoing cooperation between banks and regulators to implement BCBS liquidity standards, i.e., the LCR and the Net Stable Funding Ratio (NSFR), which are scheduled for implementation in January 2015 and January 2018, respectively, in addition to other supplemental reporting metrics.  In January 2013, BCBS released revisions to the LCR metric. We currently monitor the LCR for regulatory and internal reporting purposes and NSFR reporting is provided quarterly to OSFI. Our liquidity management framework integrates liquidity management principles and guidelines recommended by BCBS. OSFI sets out prudential considerations relating to the liquidity risk management programs of Canadian federally regulated deposit-taking institutions in its Guideline B-6, "Liquidity Principles". Significant revisions to the guideline went into effect in February 2012. BCBS guidelines are incorporated into this regulation, and in addition, the regulation requires us to measure liquidity risk using the NCCF test, and report compliance with NCCF requirements to our regulator.Contractual obligationsContractual obligations give rise to commitments of future payments affecting our short- and long-term liquidity and capital resource needs. These obligations include financial liabilities, credit and liquidity commitments, and other contractual obligations.Assets and liabilitiesThe following table provides the contractual maturity profile of our on-balance sheet assets and liabilities at their carrying values. CIBC models the behaviour of both assets and liabilities on a net cash flow basis by applying recommended regulatory stress assumptions against contractual maturities and contingent liability utilization, supplemented by business experience, to construct its behavioural balance sheet, which constitutes a key component of CIBC's liquidity risk management framework.  Less than 1 - 3 3 - 5 Over No specified    $ millions, as at January 31, 2013 1 year years years 5 years maturity Total  Assets              Cash and non-interest bearing deposits with banks$2,302 $- $- $- $- $2,302 Interest bearing deposits with banks 3,334  -  -  -  -  3,334 Securities 5,586  9,164  8,955  13,802  29,513  67,020 Cash collateral on securities borrowed 3,477  -  -  -  -  3,477 Securities purchased under resale agreements 25,581  -  -  -  -  25,581 Loans             Residential mortgages  21,029  55,219  63,413  9,347  -  149,008  Personal  4,886  258  -  708  28,933  34,785  Credit card  3,826  7,652  3,320  -  -  14,798  Business and government  10,377  14,201  4,815  15,226  -  44,619  Allowance for credit losses -  -  -  -  (1,820) (1,820)Derivative instruments  4,021  4,878  3,580  12,606  -  25,085 Customers' liability under acceptances  9,749  -  -  -  -  9,749 Other assets  -  -  -  -  14,845  14,845   $94,168 $91,372 $84,083 $51,689 $71,471 $392,783 October 31, 2012$89,615 $89,763 $91,134 $52,405 $70,468 $393,385 Liabilities             Deposits (1)(2)$94,222 $52,960 $19,346 $12,885 $126,891 $306,304 Obligations related to securities sold short  12,313  -  -  -  -  12,313 Cash collateral on securities lent  1,460  -  -  -  -  1,460 Capital Trust securities  -  -  -  1,669  -  1,669 Obligations related to securities sold under repurchase agreements  4,516  -  -  -  -  4,516 Derivative instruments  4,198  5,008  3,423  11,922  -  24,551 Acceptances  9,797  -  -  -  -  9,797 Other liabilities  -  -  -  -  10,207  10,207 Subordinated indebtedness  -  285  -  4,506  -  4,791  $126,506 $58,253 $22,769 $30,982 $137,098 $375,608 October 31, 2012(3)$120,621 $61,823 $26,898 $32,189 $134,816 $376,347 (1)Deposits less than one year comprise: $24.0 billion (October 31, 2012: 22.4 billion) with contractual maturities less than three months; $24.7 billion (October 31, 2012: $18.7 billion) with contractual maturities within three to six months; and $45.5 billion (October 31, 2012: $43.7 billion) with contractual maturities within six to twelve months.(2)Comprises $119.1 billion (October 31, 2012: $118.2 billion) of personal deposits of which $114.9 billion (October 31, 2012: $113.6 billion)  are in Canada and $4.2 billion (October 31, 2012: $4.6 billion) in other countries; $182.0 billion (October 31, 2012: $177.4 billion) of business and government deposits of which $147.2 billion (October 31, 2012: $143.4 billion) are in Canada and $34.8 billion (October 31, 2012: $34.0 billion) in other countries; and $5.2 billion (October 31, 2012: $4.7 billion) of bank deposits of which $1.8 billion (October 31, 2012: $1.5 billion) are in Canada and $3.4 billion (October 31, 2012: $3.2 billion) in other countries.(3)Certain information has been reclassified to conform to the presentation adopted in the current period.CIBC's net asset position remained unchanged relative to October 31, 2012. The changes in the contractual maturity profile were primarily due to the natural migration of maturities and also reflect the impact of our regular business activities.Credit and liquidity commitmentsThe following table provides the contractual maturity of notional amounts of credit, guarantee, and liquidity commitments should contracts be fully drawn upon and clients default. Since a significant portion of guarantees and commitments are expected to expire without being drawn upon, the total of the contractual amounts is not representative of future liquidity requirements.  Less than1 - 33 - 5Over   $ millions, as at January 31, 20131 yearyearsyears5 years TotalUnutilized credit commitments$125,932 $6,814 $16,484 $441 $149,671 Backstop liquidity facilities 3,207  -  -  -  3,207 Standby and performance letters of credit 6,342  679  602  381  8,004 Documentary and commercial letters of credit 300  -  -  -  300  $135,781 $7,493 $17,086 $822 $161,182 October 31, 2012$129,991 $10,988 $17,640 $1,480 $160,099 Other contractual obligationsThe following table provides the contractual maturities of other contractual obligations affecting our funding needs:             Less than 1 - 3 3 - 5 Over    $ millions, as at January 31, 2013 1 year years years 5 years Total  Operating leases$375 $677 $566 $1,370 $2,988 Purchase obligations (1) 631  813  490  203  2,137 Investment commitments (2) 159  -  -  -  159 Pension contributions (3) 182  -  -  -  182 Underwriting commitments 200  -  -  -  200  $1,547 $1,490 $1,056 $1,573 $5,666 October 31, 2012$1,626 $1,518 $1,051 $1,646 $5,841(1)Obligations that are legally binding agreements whereby we agree to purchase products or services with specific minimum or baseline quantities defined at fixed, minimum or variable prices over a specified period of time are defined as purchase obligations. Purchase obligations are included through to the termination date specified in the respective agreements, even if the contract is renewable. Many of the purchase agreements for goods and services include clauses that would allow us to cancel the agreement prior to expiration of the contract within a specific notice period. However, the amount above includes our obligations without regard to such termination clauses (unless actual notice of our intention to terminate the agreement has been communicated to the counterparty). The table excludes purchases of debt and equity instruments that settle within standard market timeframes.(2)As an investor in merchant banking activities, we enter into commitments to fund external private equity funds and investments in equity and debt securities at market value at the time the commitments are drawn. As the timing of future investment commitments is non-specific and callable by the counterparty, obligations have been included as less than one year.(3)Includes estimated minimum pension contributions, and expected benefit payments for post-retirement medical and dental plans, the long-term disability plan, and related medical and dental benefits for disabled employees. Subject to change as contribution decisions are affected by various factors, such as market performance, regulatory requirements, and management's ability to change funding policy. Also, funding requirements after 2013 are excluded due to the significant variability in the assumptions required to project the timing of future cash flows.Strategic riskStrategic risk arises from ineffective business strategies or the failure to effectively execute strategies. It includes, but is not limited to, potential financial loss due to the failure of acquisitions or organic growth initiatives.Oversight of strategic risk is the responsibility of the SET and the Board. At least annually, the CEO presents CIBC's strategic planning process and CIBC's annual strategic business plan to the Board for review and approval. The Board reviews the plan in light of management's assessment of emerging market trends, the competitive environment, potential risks and other key issues.One of the tools for measuring, monitoring and controlling strategic risk is attribution of economic capital against this risk. Our economic capital models include a strategic risk component for those businesses utilizing capital to fund an acquisition or a significant organic growth strategy.Insurance riskInsurance risk is the risk of a potential loss due to actual experience being different from that assumed in the design and pricing of an insurance product. Unfavourable actual experience could emerge due to adverse fluctuations in timing, size and frequency of actual claims (e.g. mortality, morbidity), policyholder behaviour (e.g. cancellation of coverage), or associated expenses.Insurance contracts provide financial compensation to the beneficiary in the event of insured risk in exchange for premiums. We are exposed to insurance risk in our life insurance business and in our life reinsurance business within the respective subsidiaries.Senior management of the insurance and reinsurance subsidiaries has primary responsibility for managing insurance risk with oversight by Risk Management. The insurance and reinsurance subsidiaries also have their own boards of directors, as well as independent Appointed Actuaries who provide additional input to risk management oversight. Processes and oversight are in place to manage the risk to our insurance business. Underwriting risk on business assumed is managed through risk policies that limit exposure to an individual life, to certain types of business and to countries.CIBC's risk governance practices ensure strong independent oversight and control of risk within the insurance businesses. The subsidiaries' boards outline the internal risk and control structure to manage insurance risk which includes risk, capital and control policies, processes as well as limits and governance. Senior management of the insurance and reinsurance subsidiaries and Risk Management attend the subsidiaries' board meetings.Operational riskOperational risk is the risk of loss resulting from inadequate or failed internal processes, systems, human error or external events.Operational risks driven by people and processes are mitigated through human resources policies and practices, and operational procedural controls, respectively. Operational risks driven by systems are managed through controls over technology development and change management.The Governance and Control Committee (GCC) provides oversight on operational risk matters and our internal control framework within the parameters and strategic objectives established by the SET. The SET is accountable to the Board and its Audit Committee and the RMC for maintaining a strong risk culture and internal control environment.Operational risk management approachWe have developed a comprehensive framework supporting and governing the processes of identifying, assessing, managing, measuring, monitoring and reporting operational risks. Our approach to operational risk management focuses on mitigating operational losses by consistently applying and utilizing control-based approaches as well as risk-specific assessment tools. The transparency of information, timely escalation of key risk issues and clear accountability for issue resolution are major pillars of our approach. We also regularly review our risk governance structure to ensure that there is clarity and ownership of key risk areas.We use a three lines of defence model to manage operational risk. Business lines are our first line of defence and have primary responsibility for the day-to-day management of operational risk inherent in their products and activities. Functionally independent governance groups, representing our second line of defence, are responsible for maintaining a robust operational risk management framework and providing operational risk oversight. Our third line of defence is Internal Audit who independently opines on the design and operating effectiveness of the controls that support our operational risk management program.Managing operational riskTo identify and assess our operational risk exposures, we utilize numerous risk assessment tools, including risk and control self-assessments, scenario analyses, audit findings, internal and external loss event analyses, key risk indicators, change management approval processes (including approval of new initiatives and products) as well as comparative analyses.In conducting risk assessments, we bring together subject matter experts from across the organization to share expertise and to identify improvements to risk identification, measurement, and control processes. Our operational risk management framework also requires risk assessments to undergo rigorous independent reviews and challenges from governance groups in their respective areas of expertise.We continuously monitor our operational risk profile to ensure that any adverse changes are addressed in a timely manner. Tools such as key risk indicators are used to identify changes in our risk profile before the risks become acute. Our risk monitoring processes support a comprehensive risk reporting program to both senior management and the Board.Our primary tool for mitigating our operational risk exposure is a robust internal control environment. Our internal control framework highlights critical internal controls across the bank which are subjected to ongoing testing and review to ensure that they are effective in mitigating our operational risk exposures. In addition, we maintain a corporate insurance program to provide additional protection from loss and a global business continuity management program to mitigate business continuity risks in the event of a disaster.Risk measurementWe use the Advanced Measurement Approach (AMA), a risk-sensitive method prescribed by BCBS, to quantify our operational risk exposure in the form of operational risk regulatory capital. We determine operational risk capital using a loss distribution approach that uses outputs from our risk assessment tools, including actual internal loss experiences, loss scenarios based on internal/external loss data and management expertise, audit findings and the results of risk and control self-assessments.Under AMA, we are permitted to recognize the risk mitigating impact of insurance in the measures of operational risk used for regulatory minimum capital requirements. Although our current insurance policies are tailored to provide earnings protection from potential high-severity losses, we do not reflect mitigation through insurance or any other risk transfer mechanism in our AMA model.We attribute operational risk capital at the line of business level. Capital represents the "worst-case loss" within a 99.9% confidence level and is determined for each loss event type and production/infrastructure/corporate governance line of business. The aggregate risk of CIBC is less than the sum of the individual parts, as the likelihood that all business groups across all regions will experience a worst-case loss in every loss category in the same year is extremely low. To adjust for the fact that all risks are not 100% correlated, we incorporate a portfolio effect to ensure that the aggregated risk is representative of the total bank-wide risk. The process for determining correlations considers both internal and external historical correlations and takes into account the uncertainty surrounding correlation estimates.The results of the capital calculations are internally backtested each quarter, and the overall methodology is independently validated by the Risk Management Validation group to ensure that the assumptions applied are reasonable and conservative.For regulated subsidiaries, the basic indicator or standardized approaches are adopted as agreed with local regulators.Reputation and legal riskOur reputation and financial soundness are of fundamental importance to us and to our customers, shareholders and employees.Reputation risk is the potential for negative publicity regarding our business conduct or practices which, whether true or not, could significantly harm our reputation as a leading financial institution, or could materially and adversely affect our business, operations or financial condition.Legal risk is the potential for civil litigation or criminal or regulatory proceedings being commenced against CIBC that, once decided, could materially and adversely affect our business, operations or financial condition.The RMC provides oversight of the management of reputation and legal risks. The identification, consideration and prudent, proactive management of potential reputation and legal risks is a key responsibility of CIBC and all of our employees.Our Global Reputation and Legal Risks Policy sets standards for safeguarding our reputation and minimizing exposure to reputation and legal risks. The policy is supplemented by business procedures for identifying and escalating transactions to the Reputation and Legal Risk Committee that could pose material reputation risk and/or legal risk.Regulatory riskRegulatory risk is the risk of non-compliance with regulatory requirements. Non-compliance with these requirements may lead to regulatory sanctions and harm to our reputation.Our regulatory compliance philosophy is to manage regulatory risk through the promotion of a strong compliance culture, and the integration of sound controls within the business and infrastructure groups. The foundation of this approach is a comprehensive Legislative Compliance Management (LCM) framework. The LCM framework maps regulatory requirements to internal policies, procedures and controls that govern regulatory compliance.Our Compliance department is responsible for the development and maintenance of a comprehensive regulatory compliance program, including oversight of the LCM framework. The department is independent of business management and reports regularly to the Audit Committee.Primary responsibility for compliance with all applicable regulatory requirements rests with senior management of the business and infrastructure groups, and extends to all employees. The Compliance department's activities support those groups, with particular emphasis on regulatory requirements that govern the relationship between CIBC and its clients that help protect the integrity of the capital markets.Environmental riskEnvironmental risk is the risk of financial loss or damage to reputation associated with environmental issues, whether arising from our credit and investment activities or related to our own operations. Our corporate environmental policy, originally approved by the Board in 1993 and most recently updated and approved by the RMC in 2011, commits CIBC to responsible conduct in all activities to protect and conserve the environment; safeguard the interests of all stakeholders from unacceptable levels of environmental risk; and support the principles of sustainable development.The policy is addressed by an integrated Corporate Environmental Management Program which is under the overall management of the Environmental Risk Management (ERM) group in Risk Management. Environmental evaluations are integrated into our credit and investment risk assessment processes, with environmental risk management standards and procedures in place for all sectors. In addition, environmental and social risk assessments in project finance are required in accordance with our commitment to the Equator Principles, a voluntary set of guidelines for financial institutions based on the screening criteria of the International Finance Corporation, which we adopted in 2003. We also conduct ongoing research and benchmarking on environmental issues such as climate change and biodiversity protection as they may pertain to responsible lending practices. We are also a signatory to and participant in the Carbon Disclosure Project, which promotes corporate disclosure to the investment community on greenhouse gas emissions and climate change management.The ERM group works closely with Corporate Services, Marketing, Communications and Public Affairs, and other business and functional groups in ensuring that high standards of environmental due diligence and responsibility are applied in our facilities management, purchasing and other operations. An Environmental Management Committee is in place to provide oversight and to support these activities.Accounting and control mattersCritical accounting policies and estimatesA summary of significant accounting policies is presented in Note 1 to the consolidated financial statements of the 2012 Annual Report. Certain accounting policies require us to make judgments and estimates, some of which may relate to matters that are uncertain. The key management judgments and estimates remain substantially unchanged from those described on pages 69 to 74 of the 2012 Annual Report.Valuation of financial instrumentsDebt and equity trading securities, trading business and government loans, obligations related to securities sold short, derivative contracts, AFS securities and FVO financial instruments are carried at fair value. FVO financial instruments include certain debt securities, structured retail deposits and business and government deposits. Retail mortgage interest rate commitments are also designated as FVO financial instruments.Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability at the measurement date in an orderly arm's length transaction between knowledgeable and willing market participants motivated by normal business considerations. Fair value measurements are categorized into levels within a fair value hierarchy based on the nature of the valuation inputs (Level 1, 2 or 3). We have an established and well-documented process for determining fair value. Fair value is based on unadjusted quoted prices in an active market, where available (Level 1). If active market prices or quotes are not available for an instrument, fair value is then based on valuation models that utilize predominantly observable market inputs (Level 2) or one or more significant non-observable market inputs (Level 3). Estimating fair value requires the application of judgment. The type and level of judgment required is largely dependent on the amount of observable market information available. For instruments valued using internally developed models that use significant non-observable market inputs and are therefore classified within Level 3 of the hierarchy, the judgment used to estimate fair value is more significant than when estimating the fair value of instruments classified within Levels 1 and 2. To ensure that valuations are appropriate, a number of policies and controls are put in place. Independent validation of fair value is performed at least on a monthly basis. Valuations are verified to external sources such as exchange quotes, broker quotes or other management-approved independent pricing sources.The following table presents amounts, in each category of financial instruments, which are fair valued using valuation techniques based on predominantly non-observable market inputs (Level 3), for the structured credit run-off business and total consolidated CIBC. For further details of the valuation of and sensitivity associated with Level 3 financial assets and liabilities, see Note 1 to the interim consolidated financial statements.      2013        2012       Jan. 31        Oct. 31  Structured credit Total Total  Structured credit  Total Total $ millions, as atrun-off business CIBC CIBC(1) run-off business  CIBC CIBC(1)Financial assets                Trading securities and loans$838 $846  2.0 % $628  $640  1.6 %AFS securities 22  1,225  4.7    22 (2) 1,370  5.5  FVO securities 167  167  55.1    170   170  55.9  Derivative instruments 514  585  2.3    591   683  2.5   $1,541 $2,823  3.0 %  1,411   2,863  3.1 %Financial liabilities                Deposits and other liabilities (3)$485 $656  30.0 % $428  $597  28.7 %Derivative instruments 568  648  2.6    1,315   1,402  5.2   $1,053 $1,304  3.3 %  1,743   1,999  4.7 %(1)Represents percentage of Level 3 financial assets and liabilities to the total financial assets and liabilities in each reported category in Note 1 of our interim consolidated financial statements.(2)Restated.(3)Includes FVO deposits and bifurcated embedded derivatives. Fair value adjustments We apply judgment in establishing valuation adjustments that take into account various factors that may have an impact on the valuation. Such factors include, but are not limited to, the bid-offer spread, illiquidity due to lack of market depth and other market risks, parameter uncertainty, model risk, credit risk, and future administration costs. During the fourth quarter of 2012, in order to reflect the observed market practice of pricing collateralized derivatives using the OIS curve, we amended our valuation approach to use OIS curves as the discount rate in place of LIBOR. Market practices continue to evolve concerning the use and construction of OIS curves that best reflect the nature of the underlying collateral.The establishment of fair value adjustments and the determination of the amount of write-downs involve estimates that are based on accounting processes and judgments by management. We evaluate the adequacy of the fair value adjustments and the amount of write-downs on an ongoing basis. The levels of fair value adjustments and the amount of the write-downs could be changed as events warrant and may not reflect ultimate realizable amounts.The following table summarizes our valuation adjustments:  2013 2012  $ millions, as at Jan. 31 Oct. 31  Securities    Market risk$2 $3 Derivatives    Market risk 54  53 Credit risk 97  137 Administration costs 5  5 Total valuation adjustments$158 $198 Allowance for credit losses We establish and maintain an allowance for credit losses that is considered the best estimate of probable credit-related losses existing in our portfolio of on- and off-balance sheet financial instruments, giving due regard to current conditions.The allowance for credit losses consists of individual and collective components.Individual allowances The majority of our business and government loan portfolios are assessed on an individual loan basis. Individual allowances are established when impaired loans are identified within the individually assessed portfolios. A loan is classified as impaired when we are of the opinion that there is no longer a reasonable assurance of the full and timely collection of principal and interest. The individual allowance is the amount required to reduce the carrying value of an impaired loan to its estimated realizable amount. This is determined by discounting the expected future cash flows at the effective interest rate inherent in the loan.Individual allowances are not established for portfolios that are collectively assessed, including most retail portfolios.Collective allowances Consumer and certain small business allowancesResidential mortgages, credit card loans, personal loans, and certain small business loan portfolios consist of large numbers of homogeneous balances of relatively small amounts, for which we take a portfolio approach to establish the collective allowance. As it is not practical to review each individual loan, we utilize a formula basis, by reference to historical ratios of write-offs to current accounts and balances in arrears. We also consider estimates of the time periods over which losses that are present would be identified and a provision taken, our view of current economic and portfolio trends, and evidence of credit quality improvements or deterioration. On a regular basis, the parameters that affect the allowance calculation are updated, based on our experience and the economic environment.Business and government allowances For groups of individually assessed loans for which no objective evidence of impairment has been identified on an individual basis, a collective allowance is provided for losses which we estimate are inherent in the portfolio at the reporting date, but not yet specifically identified from an individual assessment of the loan.The methodology for determining the appropriate level of the collective allowance incorporates a number of factors, including the size of the portfolios, expected loss rates, and relative risk profiles. We also consider estimates of the time periods over which losses that are present would be identified and a provision taken, our view of current economic and portfolio trends, and evidence of credit quality improvements or deterioration. On a regular basis, the parameters that affect the collective allowance calculation are updated, based on our experience and the economic environment. Expected loss rates for business loan portfolios are based on the risk rating of each credit facility and on the probability of default (PD) factors associated with each risk rating, as well as estimates of loss given default (LGD). The PD factors reflect our historical loss experience and are supplemented by data derived from defaults in the public debt markets. Historical loss experience is adjusted based on current observable data to reflect the effects of current conditions. LGD estimates are based on our experience over past years.For further details on allowance for credit losses, see Note 4 to the interim consolidated financial statements.Contingent liabilities and provisionIn the ordinary course of its business, CIBC is a party to a number of legal proceedings, including regulatory investigations, in which claims for substantial monetary damages are asserted against CIBC and its subsidiaries. While there is inherent difficulty in predicting the outcome of legal proceedings, based on current knowledge and in consultation with legal counsel, we do not expect that the outcome of these matters, individually or in aggregate, to have a material adverse effect on our consolidated financial statements. However, the outcome of these matters, individually or in aggregate, may be material to our operating results for a particular reporting period.Amounts are accrued if, in the opinion of management, it is both probable that an outflow of economic benefits will be required to resolve the matter, and a reliable estimate can be made of the amount of the obligation. If the reliable estimate of probable loss involves a range of potential outcomes within which a specific amount within the range appears to be a better estimate, that amount is accrued. If no specific amount within the range of potential outcomes appears to be a better estimate than any other amount, the mid-point in the range is accrued. In some instances, however, it is not possible either to determine whether an obligation is probable or to reliably estimate the amount of loss, in which case no accrual can be made.We regularly assess the adequacy of CIBC's litigation accruals and make the necessary adjustments to incorporate new information as it becomes available.The following developments occurred during the quarter:We recognized a US$150 million charge (US$110 million after-tax) in respect of the full settlement of the U.S. Bankruptcy Court adversary proceeding brought by the Estate of Lehman Brothers Holdings, Inc. challenging the reduction to zero of our unfunded commitment on a variable funding note. In 2008, we recognized a US$841 million gain on the variable funding note.In Green v. Canadian Imperial Bank of Commerce, et al., the plaintiffs filed an appeal to the Ontario Court of Appeal which will be heard in May 2013.In Brown v. Canadian Imperial Bank of Commerce and CIBC World Markets Inc., the plaintiffs filed an appeal to the Ontario Divisional Court, which will be heard in February 2013.In the mortgage prepayment class actions, the motion for class certification in Sherry v. CIBC Mortgages Inc. is scheduled to be heard in August 2013.Four additional proposed class actions (Fuze Salon v. BofA Canada Bank, et al., 1023926 Alberta Ltd. v. Bank of America Corporation, et al., The Crown & Hand Pub Ltd. v. Bank of America Corporation, et al., Hello Baby Equipment Inc. v. BofA Canada Bank, et al.) were commenced in western Canada against VISA Canada Corporation (Visa), MasterCard International Incorporated (MasterCard), CIBC and numerous other financial institutions. The actions, brought on behalf of merchants who accepted payment by Visa or MasterCard from 2001 to present, allege two "separate, but interrelated" conspiracies; one in respect of Visa and one in respect of MasterCard. The claims allege that Visa and MasterCard conspired with their issuing banks to set default interchange rate and merchant discount fees and that certain rules (Honour All Cards and No Surcharge) have the effect of increasing the merchant discount fees. The claims allege civil conspiracy, violation of the Competition Act, interference with economic interests and unjust enrichment. The claims seek unspecified general and punitive damages. These matters are similar to previously filed and disclosed proposed class actions relating to default interchange rates and merchant discount fees.Other than the items described above, there are no significant developments in the matters identified in Note 23 to our 2012 annual consolidated financial statements, and no significant new matters have arisen during the quarter ended January 31, 2013.Asset impairment As at January 31, 2013, we had goodwill of $1,700 million (October 31, 2012: $1,701 million) and other intangible assets with an indefinite life of $136 million (October 31, 2012: $136 million). Goodwill is not amortized, but is assessed, at least annually and when there are events or changes in circumstances to indicate that the carrying amount may not be recoverable, for impairment by comparing the recoverable amount of the cash-generating unit (CGU) to which goodwill has been allocated, with the carrying amount of the CGU including goodwill, with any deficiency recognized as impairment to goodwill. The recoverable amount of a CGU is defined as the higher of its estimated fair value less cost to sell or value in use.Acquired intangible assets are separately recognized if the benefits of the intangible assets are obtained through contractual or other legal rights, or if the intangible assets can be sold, transferred, licensed, rented, or exchanged. Determining the useful lives of intangible assets requires judgment and fact-based analysis. Intangibles with an indefinite life are not amortized but are assessed for impairment by comparing the recoverable amount to the carrying amount.Long-lived assets and other identifiable intangibles with a definite life are amortized over their estimated useful lives. These assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount is higher than the recoverable amount. The recoverable amount is defined as the higher of its estimated fair value less cost to sell or value in use. In performing the review for recoverability, we estimate the future cash flows expected to result from the use of the asset and its eventual disposition.We performed our annual impairment testing in the fourth quarter of 2012 and did not record any impairment at that time. During the quarter, there were no events or changes in circumstances to indicate that the carrying amounts may not be recoverable and hence no further testing was conducted.Income taxes We are subject to income tax laws in the various jurisdictions where we operate, and the tax laws in those jurisdictions are potentially subject to different interpretations by us and the relevant taxation authority. We use judgment in the estimation of income taxes and deferred income tax assets and liabilities.  As a result, management judgment is applied in the interpretation of the relevant tax laws and in estimating the provision for current and deferred income taxes. A deferred tax asset or liability is determined for each temporary difference based on the tax rates that are expected to be in effect in the period that the asset is realized or the liability is settled. Where the temporary differences will not reverse in the foreseeable future, no deferred tax amount is recognized.As at January 31, 2013, we had a deferred income tax asset of $467 million (October 31, 2012: $457 million) and a deferred income tax liability of $36 million (October 31, 2012: $37 million). We are required to assess whether it is probable that our deferred income tax asset will be realized prior to its expiration and, based on all the available evidence, determine if any portion of our deferred income tax asset should not be recognized. The factors used to assess the probability of realization are our past experience of income and capital gains, forecast of future net income before taxes, available tax planning strategies that could be implemented to realize the deferred income tax asset, and the remaining expiration period of tax loss carryforwards. Although realization is not assured, we believe, based on all the available evidence, it is probable that the remaining deferred income tax asset will be realized.For further details on our income taxes, see Note 9 to the interim consolidated financial statements.Post-employment and other long-term benefit plans We sponsor a number of benefit plans to eligible employees, including registered pension plans, supplemental pension plans, and health, dental, disability and life insurance plans. The pension plans provide benefits based on years of service, contributions and average earnings at retirement.The calculation of net defined benefit plan expense and obligations depends on various actuarial assumptions such as discount rates, expected rates ofreturn on assets, health-care cost trend rates, turnover of employees, projected salary increases, retirement age, and mortality rates. These assumptions are reviewed annually in accordance with accepted actuarial practice and are approved by management.  The actuarial assumptions used for determining net defined benefit expense for a fiscal year are set at the beginning of the annual reporting period.The discount rate assumption used in determining net defined benefit expense reflects market yields, as of the measurement date, on high-quality debt instruments with a currency and term to maturity that match the currency and expected timing of benefit payments. Our discount rate is estimated by developing a yield curve based on high-quality corporate bonds. While there is a deep market of high-quality corporate bonds denominated in Canadian dollars with short and medium terms to maturity, there is not a deep market in bonds with terms to maturity that match the timing of all the expected benefit payments for all of our Canadian plans. As a result, for our Canadian post-employment and other long-term benefit plans, we estimate the yields of high-quality corporate bonds with longer term maturities by extrapolating current yields on bonds with short and medium-term durations along the yield curve. Judgment is required in constructing the yield curve, and, as a result, different methodologies applied in constructing the yield curve can give rise to different discount rates.For further details on post-employment benefit plan expense, see Note 8 to the interim consolidated financial statements.Controls and procedures Disclosure controls and procedures CIBC's management, with the participation of the President and Chief Executive Officer and the Chief Financial Officer, has evaluated the effectiveness, as at January 31, 2013, of CIBC's disclosure controls and procedures (as defined in the rules of the SEC and the Canadian Securities Administrators) and has concluded that such disclosure controls and procedures were effective.Changes in internal control over financial reporting There have been no changes in CIBC's internal control over financial reporting during the quarter ended January 31, 2013, that have materially affected, or are reasonably likely to materially affect, its internal control over financial reporting.Interim consolidated financial statements(Unaudited) Consolidated balance sheet  2013  2012Unaudited, $ millions, as at Jan. 31  Oct. 31ASSETS     Cash and non-interest-bearing deposits with banks$2,302  $2,613 Interest-bearing deposits with banks 3,334   2,114 Securities     Trading 40,839   40,330 Available-for-sale (AFS) (Note 3) 25,878   24,700 Designated at fair value (FVO) 303   304   67,020   65,334 Cash collateral on securities borrowed 3,477   3,311 Securities purchased under resale agreements 25,581   25,163 Loans     Residential mortgages 149,008   150,056 Personal 34,785   35,323 Credit card 14,798   15,153 Business and government 44,619   43,624 Allowance for credit losses (Note 4) (1,820)  (1,860)  241,390   242,296 Other     Derivative instruments 25,085   27,039 Customers' liability under acceptances 9,749   10,436 Land, buildings and equipment 1,665   1,683 Goodwill 1,700   1,701 Software and other intangible assets 673   656 Investments in equity-accounted associates and joint ventures 1,589   1,635 Other assets 9,218   9,404   49,679   52,554  $392,783  $393,385 LIABILITIES AND EQUITY     Deposits (Note 6)     Personal$119,148  $118,153 Business and government 129,022   125,055 Bank 5,218   4,723 Secured borrowings 52,916   52,413   306,304   300,344 Obligations related to securities sold short 12,313   13,035 Cash collateral on securities lent 1,460   1,593 Capital Trust securities 1,669   1,678 Obligations related to securities sold under repurchase agreements 4,516   6,631 Other     Derivative instruments 24,551   27,091 Acceptances 9,797   10,481 Other liabilities 10,207   10,671   44,555   48,243 Subordinated indebtedness 4,791   4,823 Equity     Preferred shares 1,706   1,706 Common shares (Note 7) 7,765   7,769 Contributed surplus 79   85 Retained earnings 7,229   7,042 Accumulated other comprehensive income (AOCI) 230   264 Total shareholders' equity 17,009   16,866 Non-controlling interests 166   172 Total equity 17,175   17,038  $392,783  $393,385The accompanying notes and shaded sections in "MD&A - Management of risk" are an integral part of these interim consolidated financial statements.Consolidated statement of income  2013 2012(1) 2012Unaudited, $ millions, except as noted, for the three months ended Jan. 31 Oct. 31  Jan. 31Interest income       Loans$2,474 $2,494  $2,540 Securities 403  377   388 Securities borrowed or purchased under resale agreements 88  87   76 Deposits with banks 11  11   11   2,976  2,969   3,015 Interest expense       Deposits 904  895   915 Securities sold short 83  84   87 Securities lent or sold under repurchase agreements 30  30   52 Subordinated indebtedness 52  52   52 Capital Trust securities 34  36   36 Other 18  24   31   1,121  1,121   1,173 Net interest income 1,855  1,848   1,842 Non-interest income       Underwriting and advisory fees 106  118   107 Deposit and payment fees 191  194   190 Credit fees 118  111   97 Card fees 156  152   164 Investment management and custodial fees 112  110   102 Mutual fund fees 240  230   212 Insurance fees, net of claims 85  92   82 Commissions on securities transactions 101  98   101 Trading income (loss) 14  (17)  45 AFS securities gains, net 72  61   52 FVO losses, net (3) (4)  (8)Foreign exchange other than trading 4  9   30 Income from equity-accounted associates and joint ventures 25  44   62 Other 105  113   79   1,326  1,311   1,315 Total revenue 3,181  3,159   3,157 Provision for credit losses (Note 4) 265  328   338 Non-interest expenses       Employee compensation and benefits 1,082  1,001   1,013 Occupancy costs 168  182   173 Computer, software and office equipment 247  266   241 Communications 77  74   79 Advertising and business development 47  69   49 Professional fees 36  45   39 Business and capital taxes 17  12   13 Other 313  180   184   1,987  1,829   1,791 Income before income taxes 929  1,002   1,028 Income taxes 131  150   193 Net income$798 $852  $835 Net income attributable to non-controlling interests$2 $2  $3  Preferred shareholders$25 $29  $56  Common shareholders 771  821   776 Net income attributable to equity shareholders$796 $850  $832 Earnings per share (in dollars) (Note 10)        - Basic$1.91 $2.02  $1.94  - Diluted 1.91  2.02   1.93 Dividends per common share (in dollars) 0.94  0.94   0.90(1)Certain amounts have been reclassified to conform to the presentation adopted in the current period. The accompanying notes and shaded sections in "MD&A - Management of risk" are an integral part of these interim consolidated financial statements.Consolidated statement of comprehensive income  2013 2012 2012Unaudited, $ millions, for the three months ended Jan. 31 Oct. 31 Jan. 31Net income$798 $852 $835 Other comprehensive income (OCI), net of tax, that may be recycled to profit or loss       Net foreign currency translation adjustments       Net gains (losses) on investments in foreign operations (21) 36  41  Net (gains) losses on investments in foreign operations reclassified to net income -  -  1  Net gains (losses) on hedges of investments in foreign operations 11  (50) (19) Net (gains) losses on hedges of investments in foreign operations reclassified to net income -  -  (1)  (10) (14) 22  Net change in AFS securities       Net gains (losses) on AFS securities 20  36  85  Net (gains) losses on AFS securities reclassified to net income (52) (48) (40)  (32) (12) 45  Net change in cash flow hedges       Net gains (losses) on derivatives designated as cash flow hedges 28  21  3  Net (gains) losses on derivatives designated as cash flow hedges reclassified to net income (20) (15) 5   8  6  8 Total OCI (1) (34) (20) 75 Comprehensive income$764 $832 $910 Comprehensive income attributable to non-controlling interests$2 $2 $3  Preferred shareholders$25 $29 $56  Common shareholders 737  801  851 Comprehensive income attributable to equity shareholders$762 $830 $907 (1)Includes $1 million of gains for the quarter ended January 31, 2013 (October 31, 2012: $5 million of gains; January 31, 2012: $3 million of gains) relating to our investments in equity-accounted associates and joint ventures.         2013 2012 2012  Unaudited, $ millions, for the three months ended Jan. 31 Oct. 31 Jan. 31  Income tax (expense) benefit       Net foreign currency translation adjustments       Net gains (losses) on investments in foreign operations$1 $(9)$(1) Net gains (losses) on hedges of investments in foreign operations  (2) 7  5    (1) (2) 4  Net change in AFS securities        Net gains (losses) on AFS securities  (12) (7) (34) Net (gains) losses on AFS securities reclassified to net income  20  18  15    8  11  (19) Net change in cash flow hedges        Net gains (losses) on derivatives designated as cash flow hedges  (10) (4) (2) Net (gains) losses on derivatives designated as cash flow hedges reclassified to net income   7  5  (1)  (3) 1  (3) $4 $10 $(18)The accompanying notes and shaded sections in "MD&A - Management of risk" are an integral part of these interim consolidated financial statements.Consolidated statement of changes in equity  2013 2012 2012Unaudited, $ millions, for the three months ended Jan. 31 Oct. 31 Jan. 31Preferred shares      Balance at beginning of period$1,706 $2,006 $2,756 Redemption of preferred shares -  (300) (450)Balance at end of period$1,706 $1,706 $2,306 Common shares      Balance at beginning of period$7,769 $7,744 $7,376 Issue of common shares 59  64  161 Purchase of common shares for cancellation (64) (39) - Treasury shares 1  -  - Balance at end of period$7,765 $7,769 $7,537 Contributed surplus      Balance at beginning of period$85 $87 $93 Stock option expense 1  1  3 Stock options exercised (6) (3) (9)Other (1) -  - Balance at end of period$79 $85 $87 Retained earnings      Balance at beginning of period$7,042 $6,719 $5,457 Net income attributable to equity shareholders 796  850  832 Dividends       Preferred (25) (29) (38) Common (379) (381) (360)Premium on redemption of preferred shares -  -  (18)Premium on purchase of common shares for cancellation (205) (118) - Other -  1  - Balance at end of period$7,229 $7,042 $5,873 AOCI, net of tax       Net foreign currency translation adjustments       Balance at beginning of period$(88)$(74)$(88) Net change in foreign currency translation adjustments (10) (14) 22  Balance at end of period$(98)$(88)$(66) Net gains (losses) on AFS securities       Balance at beginning of period$350 $362 $338  Net change in AFS securities (32) (12) 45  Balance at end of period$318 $350 $383  Net gains (losses) on cash flow hedges       Balance at beginning of period$2 $(4)$(5) Net change in cash flow hedges 8  6  8  Balance at end of period$10 $2 $3 Total AOCI, net of tax$230 $264 $320 Non-controlling interests      Balance at beginning of period$172 $167 $164 Net income attributable to non-controlling interests 2  2  3 Dividends (2) -  (2)Other (6) 3  (2)Balance at end of period$166 $172 $163 Equity at end of period$17,175 $17,038 $16,286The accompanying notes and shaded sections in "MD&A - Management of risk" are an integral part of these interim consolidated financial statements.Consolidated statement of cash flows  2013 2012 2012Unaudited, $ millions, for the three months ended Jan. 31 Oct. 31 Jan. 31Cash flows provided by (used in) operating activities      Net income$798 $852 $835 Adjustments to reconcile net income to cash flows provided by (used in) operating activities:       Provision for credit losses 265  328  338  Amortization (1) 82  83  91  Stock option expense 1  1  3  Deferred income taxes (14) 15  15  AFS securities gains, net (72) (61) (52) Net gains on disposal of land, buildings and equipment (2) (14) -  Other non-cash items, net (71) (102) 131  Net changes in operating assets and liabilities         Interest-bearing deposits with banks (1,220) 4,366  (1,084)  Loans, net of repayments 446  854  (2,951)  Deposits, net of withdrawals 6,189  (4,592) 6,036   Obligations related to securities sold short (722) 1,091  (1,957)  Accrued interest receivable 67  (81) 5   Accrued interest payable (296) 279  (368)  Derivative assets 1,927  1,721  (3,095)  Derivative liabilities (2,536) (1,986) 3,616   Trading securities (509) (1,183) (2,869)  FVO securities 1  20  67   Other FVO assets and liabilities 54  (95) 125   Current income taxes (415) (22) (555)  Cash collateral on securities lent (133) (691) (649)  Obligations related to securities sold under repurchase agreements (2,115) (1,896) 2,282   Cash collateral on securities borrowed (166) 679  (28)  Securities purchased under resale agreements (418) 3,842  2,806   Other, net   314  (263) (354)  1,455  3,145  2,388 Cash flows provided by (used in) financing activities      Redemption of preferred shares -  (300) (468)Issue of common shares for cash 53  61  152 Purchase of common shares for cancellation (269) (157) - Net proceeds from treasury shares 1  -  - Dividends paid (404) (410) (398)  (619) (806) (714)Cash flows provided by (used in) investing activities      Purchase of AFS securities (6,642) (7,691) (14,408)Proceeds from sale of AFS securities 2,702  3,608  6,727 Proceeds from maturity of AFS securities 2,793  2,147  6,087 Net cash used in acquisitions -  (30) (3)Net cash provided by dispositions 41  42  - Net purchase of land, buildings and equipment (39) (117) (45)  (1,145) (2,041) (1,642)Effect of exchange rate changes on cash and non-interest-bearing deposits with banks (2) (4) 2 Net increase (decrease) in cash and non-interest-bearing deposits with banks during period (311) 294  34 Cash and non-interest-bearing deposits with banks at beginning of period 2,613  2,319  1,481 Cash and non-interest-bearing deposits with banks at end of period (2)$2,302 $2,613 $1,515 Cash interest paid$1,417 $842 $1,541 Cash income taxes paid 560  157  733 Cash interest and dividends received 3,043  3,056  3,020(1)Comprises amortization of buildings, furniture, equipment, leasehold improvements, and software and other intangible assets. (2)Includes restricted balance of $269 million (October 31, 2012: $270 million; January 31, 2012: $252 million).The accompanying notes and shaded sections in "MD&A - Management of risk" are an integral part of these interim consolidated financial statements.Notes to the interim consolidated financial statements (Unaudited)The interim consolidated financial statements of CIBC are prepared in accordance with Section 308(4) of the Bank Act which states that, except as otherwise specified by the Office of the Superintendent of Financial Institutions (OSFI), the financial statements are to be prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board. There are no accounting requirements of OSFI that are exceptions to IFRS.These interim consolidated financial statements have been prepared in accordance with IAS 34 "Interim Financial Statements". These interim consolidated financial statements do not include all of the information required for full annual consolidated financial statements and, accordingly, should be read in conjunction with the consolidated financial statements for the year ended October 31, 2012, as set out on pages 84 to 176 of the 2012 Annual Report. All amounts in these interim consolidated financial statements are presented in Canadian dollars, unless otherwise indicated. These interim consolidated financial statements were authorized for issue by the Board of Directors on February 27, 2013.1. Fair value of financial instruments The tables below present the level in the fair value hierarchy into which the fair values of financial instruments that are carried at fair value on the interim consolidated balance sheet are categorized:  Level 1  Level 2  Level 3      Quoted market price Valuation technique -observable market inputs Valuation technique -non-observable market inputs TotalTotal  2013 2012  2013 2012  2013 2012  2013 2012$ millions, as at Jan. 31 Oct. 31  Jan. 31 Oct. 31  Jan. 31 Oct. 31  Jan. 31 Oct. 31Financial assets                   Trading securities                    Government issued or guaranteed$1,662 $2,052  $7,291 $8,468  $- $-  $8,953 $10,520 Corporate equity 24,660  23,693   4,182  3,600   -  -   28,842  27,293 Corporate debt -  -   1,670  1,351   -  -   1,670  1,351 Mortgage- and asset-backed -  -   536  538   838  628   1,374  1,166   26,322  25,745   13,679  13,957   838  628   40,839  40,330 Trading loans                   Business and government$1,409 $866  $103 $27  $8 $12  $1,520 $905   AFS securities                   Government issued or guaranteed$1,357 $1,889  $16,908 $15,389  $- $-  $18,265 $17,278 Corporate equity 21  14   -  1   650  639   671  654 Corporate debt -  -   5,218  4,977   21  21   5,239  4,998 Mortgage- and asset-backed -  -   1,149  1,060   554  710   1,703  1,770  $1,378 $1,903  $23,275 $21,427  $1,225 $1,370  $25,878 $24,700 FVO securities                   Government issued or guaranteed$- $-  $46 $47  $- $-  $46 $47 Corporate debt -  -   90  87   -  -   90  87 Asset-backed -  -   -  -   167  170   167  170   -  -   136  134   167  170   303  304 FVO securities purchased under resale agreements$- $-  $38 $38  $- $-  $38 $38 Derivative instruments                   Interest rate$3 $12  $17,781 $20,166  $71 $80  $17,855 $20,258 Foreign exchange -  -   5,850  5,386   -  -   5,850  5,386 Credit -  -   -  -   514  591   514  591 Equity 39  33   278  209   -  12   317  254 Precious metal 6  7   11  15   -  -   17  22 Other commodity 89  193   443  335   -  -   532  528  $137 $245  $24,363 $26,111  $585 $683  $25,085 $27,039 Total financial assets$29,246 $28,759  $61,594 $61,694  $2,823 $2,863  $93,663 $93,316 Financial liabilities                   Deposits and other liabilities (1)$- $-  $(1,533)$(1,483) $(656)$(597) $(2,189)$(2,080)Obligations related to securities sold short (7,668) (6,805)  (4,645) (6,230)  -  -   (12,313) (13,035) $(7,668)$(6,805) $(6,178)$(7,713) $(656)$(597) $(14,502)$(15,115)Derivative instruments                   Interest rate$(2)$-  $(17,068)$(19,540) $(76)$(85) $(17,146)$(19,625)Foreign exchange -  -   (5,182) (4,556)  -  -   (5,182) (4,556)Credit -  -   -  -   (568) (1,315)  (568) (1,315)Equity (41) (18)  (1,109) (936)  (4) (2)  (1,154) (956)Precious metal (9) (18)  (6) (13)  -  -   (15) (31)Other commodity (112) (101)  (374) (507)  -  -   (486) (608) $(164)$(137) $(23,739)$(25,552) $(648)$(1,402) $(24,551)$(27,091)Total financial liabilities$(7,832)$(6,942) $(29,917)$(33,265) $(1,304)$(1,999) $(39,053)$(42,206)(1)Comprises FVO deposits of $1,518 million (October 31, 2012: $1,488 million), FVO secured borrowings of $362 million (October 31, 2012: $365 million), bifurcated embedded derivatives of $252 million (October 31, 2012: $184 million), FVO other liabilities of $7 million (October 31, 2012: $3 million), and other financial liabilities measured at fair value of $50 million (October 31, 2012: $40 million). During the quarter, we transferred $12 million of certain bifurcated embedded derivatives from Level 3 to Level 2 due to availability of market observable inputs.The net gain recognized in the interim consolidated statement of income on the financial instruments, for which fair value was estimated using valuation techniques requiring non-observable market parameters, for the quarter ended January 31, 2013 was $47 million (a net gain of $74 million and $23 million for the quarters ended October 31, 2012 and January 31, 2012, respectively.)The following table presents the changes in fair value of financial assets and liabilities in Level 3. These instruments are measured at fair value utilizing non-observable market inputs. We often hedge positions with offsetting positions that may be classified in a different level. As a result, the gains and losses for assets and liabilities in the Level 3 category presented in the table below do not reflect the effect of offsetting gains and losses on the related hedging instruments that are classified in Level 1 and Level 2.    Net gains (losses)included in income                 $ millions, for the three months ended Openingbalance Realized(1) Unrealized  (1)(2)  Net unrealizedgains (losses)includedin OCITransferin toLevel 3 Transferout ofLevel 3 Purchases Issuances Sales Settlements Closing balance Jan. 31, 2013                         Trading securities                        Mortgage- and asset-backed$628 $47  $87  $- $- $- $162 $- $- $(86)$838 Trading loans                        Business and government 12  -   -   -  -  -  -  -  (4) -  8 AFS securities                        Corporate equity 639  14   -   4  -  -  24  -  (31) -  650 Corporate debt 21  -   -   -  -  -  -  -  -  -  21 Mortgage- and asset-backed 710  4     -   (3) -  -  -  -  -  (157) 554 FVO securities                        Asset-backed 170  4   10   -  -  -  -  -  -  (17) 167 Derivative instruments                        Interest rate 80  5   (9)  -  -  -  -  -  -  (5) 71 Credit 591  (6)  (49)  -  -  -  -  -  -  (22) 514 Equity 12  -   -   -  -  -  -  -  -  (12) - Total assets$2,863 $68  $39  $1 $- $- $186 $- $(35)$(299)$2,823 Deposits and other liabilities (3)$(597)$(12) $(108) $- $- $12 $- $(32)$- $81 $(656)Derivative instruments                        Interest rate (85) (5)  9   -  -  -  -  -  -  5  (76)Credit (1,315) 22   36   -  -  -  -  -  -  689  (568)Equity (2) -   (2)  -  -  -  -  -  -  -  (4)Total liabilities$(1,999)$5  $(65) $- $- $12 $- $(32)$- $775 $(1,304)Oct. 31, 2012                          Trading securities                        Mortgage- and asset-backed$611 $11  $25  $- $- $- $1 $- $- $(20)$628 Trading loans                        Business and government 16  -   (4)  -  -  -  -  -  -  -  12 AFS securities                        Corporate equity 668  14   (10)  (17) -  -  8  -  (24) -  639 Corporate debt 65  44   (2)  (31) -  -  -  -  (51) (4) 21 Mortgage- and asset-backed 863  -   -   4  -  -  -  -  -  (157) 710 FVO securities                        Asset-backed 195  16   18   -  -  -  -  -  (18) (41) 170 Derivative instruments                        Interest rate 82  2   (2)  -  -  -  -  -  -  (2) 80 Credit 758  (4)  (142)  -  -  -  -  -  -  (21) 591 Equity 9  -   3   -  -  -  -  -  -  -  12 Total assets$3,267 $83  $(114) $(44)$- $- $9 $- $(93)$(245)$2,863 Deposits and other liabilities (3)$(582)$(1) $(24) $- $- $27 $(3)$(6)$(20)$12 $(597)Derivative instruments                        Interest rate (89) (11)  2   -  -  -  -  -  -  13  (85)Credit (1,494) 11   126   -  -  -  -  -  -  42  (1,315)Equity (3) 1   1   -  -  -  -  -  -  (1) (2)Total liabilities$(2,168)$-  $105  $- $- $27 $(3)$(6)$(20)$66 $(1,999)(1)Includes foreign currency gains and losses. (2)Comprises unrealized gains and losses relating to these assets and liabilities held at the end of the reporting period. (3)Includes FVO deposits of $530 million (October 31, 2012: $472 million) and bifurcated embedded derivatives of $123 million (October 31, 2012: $122 million).Sensitivity of Level 3 financial assets and liabilitiesValuation techniques using predominantly non-observable market inputs are used for a number of financial instruments including our structured credit run-off business.Asset-backed securities (ABS) are sensitive to credit spreads, which we consider to be a non-observable market input.AFS privately issued equity and debt securities are sensitive to non-observable assumptions and inputs such as projected cash flow and earnings multiples.FVO deposits that are not managed as part of our structured credit run-off business are sensitive to non-observable credit spreads, which are derived using extrapolation and correlation assumptions.Certain bifurcated embedded derivatives, due to the complexity and unique structure of the instruments, require significant assumptions and judgment to be applied to both the inputs and valuation techniques, which we consider to be non-observable.The effect of changing one or more of the assumptions used to fair value these instruments to reasonably possible alternatives would impact net income or OCI as described below.Our unhedged non-U.S. residential mortgage market (USRMM) structured credit positions are sensitive to changes in mark-to-market (MTM), generally as derived from indicative broker quotes and internal models. A 10% adverse change in MTM of the underlyings would result in losses of approximately $72 million, excluding unhedged non-USRMM positions classified as loans which are carried at amortized cost.For our hedged positions, there are two categories of sensitivities; the first relates to our hedged loan portfolio and the second relates to our hedged fair valued exposures. Since on-balance sheet hedged loans are carried at amortized cost whereas the related credit derivatives are fair valued, a 10% increase in the MTM of credit derivatives in our hedged structured credit positions would result in a net gain of approximately $5 million, assuming current credit valuation adjustment (CVA) ratios remain unchanged. A 10% reduction in the MTM of our on-balance sheet fair valued exposures and a 10% increase in the MTM of all credit derivatives in our hedged structured credit positions would result in a net loss of approximately $19 million, assuming current CVA ratios remain unchanged.The impact of a 10% increase in the MTM of unmatched credit derivatives, where we have purchased protection but do not have exposure to the underlying, would result in no significant gain or loss, assuming current CVA ratios remain unchanged.The impact of a 10% reduction in receivables, net of CVA from financial guarantors, would result in a net loss of approximately $23 million.A 10% reduction in the MTM of our on-balance sheet ABS that are valued using non-observable credit and liquidity spreads would result in a decrease in OCI of approximately $55 million.A 10% reduction in the MTM of our AFS privately issued equity and debt securities that are valued using non-observable inputs such as projected cash flows and earnings multiples, would result in a decrease in OCI of approximately $66 million.A 10% reduction in the MTM of certain FVO deposits which are not managed as part of our structured credit run-off business and are valued using non-observable inputs, including correlation assumptions and extrapolated credit spreads, would result in a gain of approximately $5 million.A 10% reduction in the MTM of certain bifurcated embedded derivatives, valued using internally vetted valuation techniques and correlation assumptions, would result in a gain of approximately $12 million.FVO liabilitiesThe impacts of changes in CIBC's own credit risk on our outstanding FVO liabilities were gains of $1 million for the quarter ended January 31, 2013 and less than $1 million cumulatively (losses of less than $1 million for the quarter ended January 31, 2012 and cumulatively).As at January 31, 2013, the total contractual settlement amount of the FVO deposits was $12 million lower (October 31, 2012: $5 million lower) than its fair value.2. Significant dispositionPrivate wealth management (Asia)On January 25, 2013, CIBC sold its stand-alone Hong Kong and Singapore-based private wealth management business. This niche advisory and brokerage business, which was included in International banking within Corporate and Other, provided private banking services to a small number of high-net-worth individuals in the Asia-Pacific region and had assets under management of approximately $2 billion. As a result, CIBC recognized a gain, net of associated expenses, of $16 million ($16 million after-tax) during the quarter. CIBC's other businesses in Asia are unaffected by this transaction.3. Securities Fair value of AFS securities          2013       2012$ millions, as at       Jan. 31       Oct. 31    Gross Gross      Gross Gross      Amortized unrealized unrealized Fair Amortized unrealized unrealized Fair    cost gains losses value cost gains losses value  Securities issued or guaranteed by:                 Canadian federal government$7,468 $45 $(2)$7,511 $6,683 $84 $(2)$6,765  Other Canadian governments 4,595  30  -  4,625  4,197  28  (2) 4,223  U.S. Treasury and agencies 4,070  15  (19) 4,066  4,393  14  (8) 4,399  Other foreign governments 2,055  25  (17) 2,063  1,885  24  (18) 1,891 Mortgage-backed securities 1,117  7  (1) 1,123  1,004  19  -  1,023 Asset-backed securities 572  8  -  580  736  11  -  747 Corporate public debt 5,167  75  (12) 5,230  4,938  69  (18) 4,989 Corporate private debt 5  4  -  9  5  4  -  9 Corporate public equity 9  13  -  22  5  11  -  16 Corporate private equity 385  264  -  649  378  260  -  638  $25,443 $486 $(51)$25,878 $24,224 $524 $(48)$24,700 As at January 31, 2013, the amortized cost of 117 AFS securities that are in a gross unrealized loss position (October 31, 2012: 100 securities) exceeded their fair value by $51 million (October 31, 2012: $48 million). The securities that have been in a gross unrealized loss position for more than a year include 3 AFS securities (October 31, 2012: 6 securities), with a gross unrealized loss of less than $1 million (October 31, 2012: less than $1 million).Reclassification of financial instrumentsIn October 2008, amendments made to IAS 39 "Financial Instruments - Recognition and Measurement" and IFRS 7 "Financial Instruments - Disclosures" permitted certain trading financial assets to be reclassified to loans and receivables and AFS in rare circumstances. As a result of these amendments, we reclassified certain securities to loans and receivables and AFS with effect from July 1, 2008. During the quarter ended January 31, 2013, we have not reclassified any securities.The following tables show the carrying values, fair values, and income or loss impact of the assets reclassified:      2013   2012$ millions, as at   Jan. 31   Oct. 31    Fair Carrying Fair Carrying      value value value value  Trading assets previously reclassified to loans and receivables$3,812 $3,839 $3,864 $3,940 Trading assets previously reclassified to AFS 12  12  14  14 Total financial assets reclassified$3,824 $3,851 $3,878 $3,954              2013 2012 2012  $ millions, for the three months ended   Jan. 31 Oct. 31 Jan. 31  Net income (before taxes) recognized on assets reclassified           Interest income  $16 $19 $27  Impairment write-downs   -  (34) -      $16 $(15)$27 Change in fair value recognized in net income (before taxes) on assets if reclassification had not been made           On trading assets previously reclassified to loans and receivables  $24 $22 $24  On trading assets previously reclassified to AFS   -  1  -      $24 $23 $24 The effective interest rates on trading securities previously reclassified to AFS ranged from 3% to 13% with expected recoverable cash flows of $1.2 billion as of their reclassification date. The effective interest rates on trading assets previously reclassified to loans and receivables ranged from 4% to 10% with expected recoverable cash flows of $7.9 billion as of their reclassification date.4. Loans Allowance for credit losses                 2013 2012 2012$ millions, for the three months ended     Jan. 31 Oct. 31 Jan. 31     Individual Collective Total  Total Total    allowance allowance allowance allowance allowanceBalance at beginning of period$475 $1,441 $1,916 $1,936 $1,851  Provision for credit losses 30  235  265  328  338  Write-offs (54) (282) (336) (380) (322) Recoveries -  44  44  43  40  Interest income on impaired loans (6) (3) (9) (10) (16) Other 1  -  1  (1) 4 Balance at end of period$446 $1,435 $1,881 $1,916 $1,895 Comprises:           Loans$446 $1,374 $1,820 $1,860 $1,849  Undrawn credit facilities (1) -  61  61  56  46(1)Included in Other liabilities on the interim consolidated balance sheet. Impaired loans                     2013 2012  $ millions, as at        Jan. 31 Oct. 31    Gross Individual Collective  Net Net    impaired allowance allowance  (1) impaired impaired  Residential mortgages$481 $1 $50  $430 $427 Personal 276  8  174   94  83 Business and government 992  437  21   534  636 Total impaired loans (2)$1,749 $446 $245  $1,058 $1,146(1)Includes collective allowance relating to personal, scored small business and mortgage impaired loans that are greater than 90 days delinquent. In addition, we have collective allowance of $1,190 million (October 31, 2012: $1,195 million) on balances which are not impaired.  (2)Average balance of gross impaired loans for the quarter ended January 31, 2013 totalled $1,794 million (for the quarter ended October 31, 2012: $1,872 million). Contractually past due loans but not impaired        2013 2012$ millions, as at       Jan. 31 Oct. 31  Less than 31 to Over      31 days 90 days 90 days Total Total Residential mortgages$1,801 $679 $255 $2,735 $2,732 Personal 459  107  25  591  564 Credit card 700  205  133  1,038  1,060 Business and government 124  99  19  242  284    $3,084 $1,090 $432 $4,606 $4,640 5. Structured entities and derecognition of financial assetsStructured entitiesStructured entities are entities that have been designed so that voting or similar rights are not the dominant factor in deciding who controls the entity, such as when any voting rights relate to administrative tasks only and the relevant activities are directed by means of contractual arrangements. Structured entities include special purpose entities which are entities that are created to accomplish a narrow and well-defined objective.We consolidate a structured entity when the substance of the relationship indicates that we control the structured entity.Details of our consolidated and non-consolidated structured entities are provided on pages 117 and 118 of the 2012 Annual Report.With respect to our Covered Bond Programme as at January 31, 2013, $14.6 billion of mortgages with a fair value of $14.7 billion (October 31, 2012: $14.6 billion with a fair value of $14.7 billion) supported associated covered bond liabilities of $13.8 billion with a fair value of $13.9 billion (October 31, 2012: $13.9 billion with a fair value of $14.0 billion).With respect to Cards II Trust and Broadway Trust entities as at January 31, 2013, $6.0 billion of credit card receivable assets with a fair value of $6.0 billion (October 31, 2012:  $5.0 billion with a fair value of $5.0 billion) supported associated funding liabilities of $6.0 billion with a fair value of $6.0 billion (October 31, 2012: $4.9 billion with a fair value of $5.0 billion).As at January 31, 2013, there were $1.5 billion (October 31, 2012: $1.6 billion) of total assets in our non-consolidated multi-seller conduits. Our on-balance sheet amounts and maximum exposure to loss related to structured entities that are not consolidated are set out in the table below. The maximum exposure comprises the carrying value of unhedged investments, the notional amounts for liquidity and credit facilities, and the notional amounts less accumulated fair value losses for unhedged written credit derivatives on structured entity reference assets. The impact of CVA is not considered in the table below.          CIBC                  structured       Commercial     CIBC collateralized  Third-party  Pass-through mortgage  sponsored debt obligation  structured vehicles investment securitization$ millions, as at January 31, 2013 conduits vehicles  Run-off Continuing structures trust On-balance sheet assets at carrying value (1)             Trading securities$15 $7 $831 $158 $2,716 $2  AFS securities -  -  2  582  -  -  FVO securities -  -  167  -  -  -  Loans 81  222  3,449  25  -  -  Derivatives (2) -  -  -  -  12  -  $96 $229 $4,449 $765 $2,728 $2 October 31, 2012$103 $232 $4,313 $1,004 $2,259 $1 On-balance sheet liabilities at carrying value (1)             Derivatives (2)$- $20 $466 $- $197 $- October. 31, 2012$- $23 $1,198 $- $151 $- Maximum exposure to loss, net of hedges             Investment and loans$96 $229 $4,449 $765 $2,716 $2  Notional of written derivatives, less fair value losses -  190  3,043  -  -  -  Liquidity and credit facilities 1,464  42  370  25  -  -  Less: hedges of investments, loans and written derivatives exposure -  (295) (6,551) -  (2,716) -  $1,560 $166 $1,311 $790 $- $2 October 31, 2012$1,657 $100 $1,360 $1,027 $- $1 (1)Excludes structured entities established by Canada Mortgage and Housing Corporation (CMHC), Federal National Mortgage Association (Fannie Mae), Federal Home Loan Mortgage Corporation (Freddie Mac), Government National Mortgage Association (Ginnie Mae), Federal Home Loan Banks, Federal Farm Credit Bank, and Student Loan Marketing Association (Sallie Mae). (2)Comprises written credit default swaps and total return swaps under which we assume exposures and excludes all other derivatives.Derecognition of financial assetsDetails of the financial assets that did not qualify for derecognition are provided on page 120 of the 2012 Annual Report.The following table provides the carrying amount and fair value of transferred financial assets that did not qualify for derecognition and the associated financial liabilities:     2013   2012$ millions, as at   Jan. 31   Oct. 31  Carrying Fair Carrying Fair  amount value amount valueResidential mortgages securitizations (1)$32,373 $32,437 $32,409 $32,528 Securities held by counterparties as collateral under repurchase agreements (2)(3) 712  712  1,795  1,795 Securities lent for securities collateral (2)(3) 8,058  8,058  5,324  5,324  $41,143 $41,207 $39,528 $39,647 Carrying amount of associated liabilities$41,905 $41,891 $40,762 $40,830 (1)Includes $4.3 billion (October 31, 2012: $4.0 billion) of mortgages underlying mortgage-backed securities held by CMHC counterparties as collateral under repurchase agreements. Certain cash in transit balances related to the securitization process amounting to $976 million (October 31, 2012: $1,196 million) have been applied to reduce these balances.(2)Does not include over-collateralization of assets pledged. (3)Excludes third-party pledged assets.Additionally, we securitized $23.8 billion with a fair value of $23.9 billion (October 31, 2012: $22.7 billion with a fair value of $22.8 billion) of mortgages that were not transferred to external parties. 6. Deposits (1)(2)           2013 2012$ millions, as at          Jan. 31 Oct. 31  Payable on  Payable  Payable on a         demand  (3) after notice  (4) fixed date  (5) Total  Total  Personal$8,440  $69,105  $41,603  $119,148 $118,153 Business and government 29,279   18,392   81,351   129,022  125,055 Bank 1,668   7   3,543   5,218  4,723 Secured borrowings (6) -   -   52,916   52,916  52,413  $39,387  $87,504  $179,413  $306,304 $300,344 Comprised of:              Held at amortized cost         $304,424 $298,491  Designated at fair value          1,880  1,853           $306,304 $300,344 Total deposits include:              Non-interest-bearing deposits               In domestic offices         $30,248 $29,717   In foreign offices          2,476  2,592  Interest-bearing deposits               In domestic offices            233,649  228,790   In foreign offices              U.S. federal funds purchased                  499  437           $306,304 $300,344 (1)Includes deposits of $67.5 billion (October 31, 2012: $66.8 billion) denominated in U.S. dollars and deposits of $7.7 billion (October 31, 2012: $6.5 billion) denominated in other foreign currencies.(2)Net of purchased notes of $1,174 million (October 31, 2012: $1,127 million). (3)Includes all deposits for which we do not have the right to require notice of withdrawal. These deposits are generally chequing accounts. (4)Includes all deposits for which we can legally require notice of withdrawal. These deposits are generally savings accounts. (5)Includes all deposits that mature on a specified date. These deposits are generally term deposits, guaranteed investment certificates, and similar instruments.  (6)Comprises liabilities issued by or as a result of activities associated with the securitization of residential mortgages, Covered Bond Programme, and consolidated securitization vehicles.7. Share capitalCommon shares       2013   2012   2012   $ millions, except number of shares, for the three months ended   Jan. 31   Oct. 31   Jan. 31       Number   Number     Number       of shares Amount of shares Amount   of shares Amount   Balance at beginning of period 404,484,938 $7,769  405,626,082 $7,744  400,534,211 $7,376  Issuance pursuant to:              Stock option plans 535,386  38  276,397  17  573,490  39  Shareholder investment plan (1) 7,672  1  291,216  23  1,319,517  99    Employee share purchase plan 253,964  20  316,286  24  309,221  23       405,281,960 $7,828  406,509,981 $7,808  402,736,439 $7,537  Purchase of common shares for cancellation (3,337,300) (64) (2,025,000) (39) -  -  Treasury shares 15,142  1  (43) - (2)(8,050) - (2)Balance at end of period 401,959,802 $7,765  404,484,938 $7,769  402,728,389 $7,537          (1)Commencing with the January 28, 2013 dividend payment, shares distributed under the Shareholder Investment Plan were acquired in the open market. (2)Due to rounding. Regulatory capital and ratiosOur capital ratios and assets-to-capital multiple (ACM) are presented in the following table:                  2013(1)  2012(1)$ millions, as at Jan. 31   Oct. 31 Basel III - Transitional basis       Common Equity Tier 1 capital$15,556    n/a Tier 1 capital 16,718    n/a Total capital 20,689    n/a Risk-weighted assets (RWA) 134,821    n/a Common Equity Tier 1 ratio 11.5 %  n/a Tier 1 capital ratio 12.4 %  n/a Total capital ratio 15.3 %  n/a ACM 17.9 x  n/a Basel III - All-in-basis       Common Equity Tier 1 capital$12,077    n/a Tier 1 capital 15,179    n/a Total capital 19,352    n/a RWA 126,366    n/a Common Equity Tier 1 ratio 9.6 %  n/a Tier 1 capital ratio 12.0 %  n/a Total capital ratio 15.3 %  n/a Basel II       Tier 1 capital n/a  $15,940 (2)Total capital n/a   19,924 (2)RWA n/a   115,229  Tier 1 capital ratio n/a   13.8 %Total capital ratio n/a   17.3 %ACM n/a   17.4 x (1)Capital measures for fiscal year 2013 are based on Basel III and prior period are based on Basel II.                (2)The Tier 1 capital and Total capital incorporate OSFI's IFRS transitional relief election.               n/a Not applicable.During the quarter we have complied with all of our regulatory capital requirements.8. Post-employment benefit expense             2013 2012 2012$ millions, for the three months ended Jan. 31 Oct. 31 Jan. 31Defined benefit plans       Pension plans$35$30$33 Other post-employment plans 9 9 8Total net defined benefit expense$44$39$41Defined contribution plans       CIBC's pension plans$3$2$3 Government pension plans (1) 21 20 20Total defined contribution expense$24$22$23       (1) Includes Canada Pension Plan, Quebec Pension Plan, and U.S. Federal Insurance Contributions Act.           9. Income taxesDeferred income tax assets and liabilitiesAs at January 31, 2013, we had available gross deferred income tax assets of $467 million (October 31, 2012: $457 million) and gross deferred income tax liabilities of $36 million (October 31, 2012: $37 million).EnronIn prior years, the Canada Revenue Agency issued reassessments disallowing the deduction of approximately $3 billion of the 2005 Enron settlement payments and related legal expenses. The matter is currently in litigation and on December 21, 2011 (and reconfirmed on July 5, 2012), in connection with a motion by CIBC to strike the Crown's replies, the Tax Court of Canada struck certain portions of the replies and directed the Crown to submit amended replies. Both the Crown and CIBC appealed the ruling to the Federal Court of Appeal, and the appeal was heard on November 21, 2012. A decision has not yet been rendered.Should we successfully defend our tax filing position in its entirety, we would recognize an additional accounting tax benefit of $214 million and taxable refund interest of approximately $187 million. Should we fail to defend our position in its entirety, we would incur an additional tax expense of approximately $866 million and non-deductible interest of approximately $124 million.10. Earnings per share                  2013 2012 2012$ millions, except number of shares and per share amounts, for the three months ended Jan. 31 Oct. 31 Jan. 31Basic EPS      Net income attributable to equity shareholders$796 $850 $832 Less: Preferred share dividends and premiums 25  29  56 Net income attributable to common shareholders$771 $821 $776 Weighted-average common shares outstanding (thousands) 403,332  405,404  401,099 Basic EPS$1.91 $2.02 $1.94 Diluted EPS      Net income attributable to diluted common shareholders$771 $821 $776 Weighted-average common shares outstanding (thousands) 403,332  405,404  401,099 Add: Stock options potentially exercisable (1) (thousands) 438  440  514 Weighted-average diluted common shares outstanding (thousands) 403,770  405,844  401,613 Diluted EPS$1.91 $2.02 $1.93  (1)Excludes average options outstanding of 346,801 (October 31, 2012: 1,251,523; January 31, 2012: 1,537,948) with a weighted-average exercise price of $95.62 (October 31, 2012: $83.73; January 31, 2012: $82.33) for the quarter ended January 31, 2013, as the options' exercise prices were greater than the average market price of CIBC's common shares.             11. Contingent liabilities and provisionIn the ordinary course of its business, CIBC is a party to a number of legal proceedings, including regulatory investigations, in which claims for substantial monetary damages are asserted against CIBC and its subsidiaries. While there is inherent difficulty in predicting the outcome of legal proceedings, based on current knowledge and in consultation with legal counsel, we do not expect that the outcome of these matters, individually or in aggregate, to have a material adverse effect on our consolidated financial statements. However, the outcome of these matters, individually or in aggregate, may be material to our operating results for a particular reporting period.Amounts are accrued if, in the opinion of management, it is both probable that an outflow of economic benefits will be required to resolve the matter, and a reliable estimate can be made of the amount of the obligation. If the reliable estimate of probable loss involves a range of potential outcomes within which a specific amount within the range appears to be a better estimate, that amount is accrued. If no specific amount within the range of potential outcomes appears to be a better estimate than any other amount, the mid-point in the range is accrued. In some instances, however, it is not possible either to determine whether an obligation is probable or to reliably estimate the amount of loss, in which case no accrual can be made.We regularly assess the adequacy of CIBC's litigation accruals and make the necessary adjustments to incorporate new information as it becomes available.The following developments occurred during the quarter:We recognized a US$150 million charge (US$110 million after-tax) in respect of the full settlement of the U.S. Bankruptcy Court adversary proceeding brought by the Estate of Lehman Brothers Holdings, Inc. challenging the reduction to zero of our unfunded commitment on a variable funding note. In 2008, we recognized a US$841 million gain on the variable funding note.In Green v. Canadian Imperial Bank of Commerce, et al., the plaintiffs filed an appeal to the Ontario Court of Appeal which will be heard in May 2013.In Brown v. Canadian Imperial Bank of Commerce and CIBC World Markets Inc., the plaintiffs filed an appeal to the Ontario Divisional Court, which will be heard in February 2013.In the mortgage prepayment class actions, the motion for class certification in Sherry v. CIBC Mortgages Inc. is scheduled to be heard in August 2013.Four additional proposed class actions (Fuze Salon v. BofA Canada Bank, et al., 1023926 Alberta Ltd. v. Bank of America Corporation, et al., The Crown & Hand Pub Ltd. v. Bank of America Corporation, et al., Hello Baby Equipment Inc. v. BofA Canada Bank, et al.) were commenced in western Canada against VISA Canada Corporation (Visa), MasterCard International Incorporated (MasterCard), CIBC and numerous other financial institutions. The actions, brought on behalf of merchants who accepted payment by Visa or MasterCard from 2001 to present, allege two "separate, but interrelated" conspiracies; one in respect of Visa and one in respect of MasterCard. The claims allege that Visa and MasterCard conspired with their issuing banks to set default interchange rate and merchant discount fees and that certain rules (Honour All Cards and No Surcharge) have the effect of increasing the merchant discount fees. The claims allege civil conspiracy, violation of the Competition Act, interference with economic interests and unjust enrichment. The claims seek unspecified general and punitive damages. These matters are similar to previously filed and disclosed proposed class actions relating to default interchange rates and merchant discount fees.Other than the items described above, there are no significant developments in the matters identified in Note 23 to our 2012 annual consolidated financial statements, and no significant new matters have arisen during the quarter ended January 31, 2013.12. Segmented informationCIBC has three strategic business units (SBUs) - Retail and Business Banking, Wealth Management and Wholesale Banking. These SBUs are supported by six functional groups - Technology and Operations, Corporate Development, Finance, Treasury, Administration, and Risk Management, which form part of Corporate and Other. The revenue, expenses and balance sheet resources of these functional groups are generally allocated to the business lines within the SBUs. Corporate and Other also includes our International banking operations comprising mainly FirstCaribbean International Bank Limited, strategic investments in the CIBC Mellon joint ventures and The Bank of N.T. Butterfield & Son Limited, and other income statement and balance sheet items not directly attributable to the business lines.    Retail and                Business  Wealth  Wholesale  Corporate  CIBC$ millions, for the three months ended  Banking  Management  Banking  and Other  TotalJan. 31Net interest income (1) $1,461 $47 $343 $4 $1,8552013Non-interest income   525  465  219  117  1,326 Intersegment revenue(2)  79  (80)  1  -  - Total revenue (1)  2,065  432  563  121  3,181 Provision for credit losses   241  -  10  14  265 Amortization(3)  22  3  1  56  82 Other non-interest expenses  999  312  444  150  1,905 Income (loss) before income taxes   803  117  108  (99)  929 Income taxes (1)  192  27  17  (105)  131 Net income $611 $90 $91 $6 $798 Net income attributable to:                 Non-controlling interests $- $- $- $2$ 2  Equity shareholders  611  90  91  4  796 Average assets (4) $251,786 $4,015 $125,734 $20,778 $402,313Oct. 31(5)Net interest income (1) $1,462 $46 $321 $19 $1,8482012Non-interest income  498  451  253  109  1,311 Intersegment revenue (2)  76  (77)  1  -  - Total revenue (1)  2,036  420  575  128  3,159 Provision for credit losses  255  -  66  7  328 Amortization (3)  22  2  1  58  83 Other non-interest expenses  1,008  306  262  170  1,746 Income (loss) before income taxes  751  112  246  (107)  1,002 Income taxes (1)  182  28  53  (113)  150 Net income $569 $84 $193 $6 $852 Net income attributable to:                 Non-controlling interests $- $- $-  $2 $2  Equity shareholders  569  84  193  4  850 Average assets (4) $251,939 $3,960 $125,467 $19,726 $401,092Jan. 31Net interest income (1) $1,445 $48 $262 $87 $1,8422012Non-interest income  513  458  233  111  1,315 Intersegment revenue (2)  71  (71)  -  -  - Total revenue (1)  2,029  435  495  198  3,157 Provision for credit losses  281  -  26  31  338 Amortization (3)  22  2  1  66  91 Other non-interest expenses  974  310  288  128  1,700 Income (loss) before income taxes  752  123  180  (27)  1,028 Income taxes (1)  185  23  47  (62)  193 Net income $567 $100 $133 $35 $835 Net income attributable to:                 Non-controlling interests $- $- $- $3 $3  Equity shareholders  567  100  133  32  832 Average assets (4) $255,441 $4,058 $111,209 $25,414 $396,122(1)Wholesale Banking net interest income and income tax expense includes a TEB adjustment of $92 million for the three months ended January 31, 2013 ($92 million and $57 million for the three months ended October 31, 2012 and January 31, 2012, respectively) with an equivalent offset in Corporate and Other.(2)Intersegment revenue represents internal sales commissions and revenue allocations under the Manufacturer / Customer Segment / Distributor Management Model.  (3)Comprises amortization of buildings, furniture, equipment, leasehold improvements, and software and other intangible assets.  (4)Assets are disclosed on an average basis as this measure is most relevant to a financial institution and is the measure reviewed by management.(5)Certain amounts have been reclassified to conform to the presentation adopted in the current period.     SOURCE: CIBCFor further information: Investor and analyst inquiries should be directed to Geoff Weiss, Senior Vice-President, Planning, Analysis and Investor Relations, at 416-980-5093. Media inquiries should be directed to Mary Lou Frazer, Senior Director, Investor & Financial Communications, at 416-980-4111.