A CIBC branch is seen in Toronto in this file photo.Mark Blinch/Reuters
Canadian Imperial Bank of Commerce's wholesale banking division is expanding in the U.K., at least a little bit.
The move continues CIBC's incremental approach to international expansion – a minority stake here, an alliance there.
In this case, CIBC is lending money to a British brokerage in return for wider access to the firm's clients and research.
The Canadian bank is making a "substantial investment" in Oriel Securities of the U.K., the head of Oriel said in an email to clients. Substantial to Oriel, perhaps, but not to CIBC.
While the terms were not disclosed, a person familiar with the situation said it is a loan. The Financial Times said the amount is in the "single-digit" millions and could be converted into an equity stake in the future.
CIBC has no plans to convert the loan to equity, a spokesman for the bank said.
Oriel and CIBC have had a deal for the past year in which CIBC distributes Oriel research in the U.S. and Canada, giving the Canadian company a bit more to offer clients from an international perspective.
Oriel CEO Simon Bragg said the "agreement takes our relationship to the next level."
Under the new agreement, Oriel said there will be "wider mutual distribution of research across Europe, Canada and the United States, enhanced access to existing investors and new sources of capital for Oriel Securities' corporate client base, as well as opportunities for cross border listings and integrated M&A advice and financing."
(Boyd Erman is a Globe and Mail Capital Markets Reporter & Streetwise Columnist.)
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