CIBC May Have Gone Too Far in Mortgage Retreat, CEO Dodig Says
(Bloomberg) -- The head of Canadian Imperial Bank of Commerce admits the lender may have retreated too far from the domestic mortgage market.
“Candidly, I think we went too far left in slowing things down, put the brakes on too hard, and we’re re-adjusting for that,” Chief Executive Officer Victor Dodig said Wednesday at the Scotiabank Financials Summit in Toronto. “We are now looking to create a more robust presence in the mortgage landscape.”
CIBC had trounced its peers with 12% year-over-year gains in mortgage growth through the first three quarters of 2017 -- until the pendulum began to swing the other way. The bank’s domestic mortgage book has contracted in each quarter this year.
Dodig said Canada’s fifth largest bank is focusing on the long game in these “unprecedented” times.
“Political leadership tends to be on the angrier side, the more aggressive side; negative rates, trade wars,” Dodig said. “These aren’t good trends.”
How negative interest rates will go, particularly in the U.S. and Canada, remains a question, he said. “I think we have to be prepared for that.”
If things go really sideways, “because we can’t control the weather, we adjust our business investment and spending accordingly. That’s going to be the plan going forward.”
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