CIBC plans job cuts, joining Canadian peers in savings quest
Canadian Imperial Bank of Commerce plans to eliminate an unspecified portion of its workforce as part of Chief Executive Victor Dodig’s push to streamline the company, following cost-cutting efforts by the nation’s other lenders.
Dodig mentioned the reductions in an internal memo on Thursday that did not include the number of workers to be let go. He said the Toronto-based firm, Canada’s fifth-largest lender by assets, must keep “a careful eye on costs” and improve efficiency.
“As a result, some team members will be leaving our bank in the coming months,” Dodig said. “We are not taking these decisions lightly as they involve colleagues who have made valuable contributions.” CIBC’s plan was reported earlier by the Globe and Mail.
CIBC joins the ranks of Canadian lenders that are making cuts. Bank of Montreal said in December that it would eliminate about 5% of its workforce, or as many as 2,300 positions, the most dramatic pullback by a Canadian bank in more than 15 years. Toronto-Dominion Bank took a restructuring charge when reporting earnings last month tied to an unspecified number of job cuts.
Dodig said CIBC has made “steady progress,” with an efficiency ratio improving to 55.5% at year-end from 60.4% in 2015. The ratio is a measure of what it costs to produce a dollar of revenue. The firm had 45,157 employees as of the end of October, the smallest workforce among the five biggest Canadian banks.
In December, Dodig set a “realistic” efficiency target range of 53.5% to 54% for 2022, a goal he reiterated at a banking conference in January.