CIBC selling shares to GNB Financial Group Ltd
Canadian Imperial Bank of Commerce (CIBC) CIBC has agreed to sell a large portion of its investment in CIBC FirstCaribbean International Bank to GNB Financial Group Ltd. for US$797 million.
GNB will buy 66.7 percent of the shares of FirstCaribbean, subject to the approval of local regulators.
CIBC will retain a 24.9 percent interest in the Caribbean bank.
The Canadian bank is expected to receive about US$200 million in cash and provide secured financing for the rest.
“FirstCaribbean is a strong, well-performing business that continues to grow across the region. FirstCaribbean remains laser focused on delivering on its strategy – providing its clients with first class service through a modern everyday banking experience and providing its employees with the best possible work experience,” said Colette Delaney, CEO, FirstCaribbean earlier today.
“FirstCaribbean will remain the strong entity it is today, committed to servicing its clients in the region,” said Jaime Gilinski, Chairman of GNB Financial Group Limited. “I have been impressed by the strength and stability of FirstCaribbean and am excited about its prospects for the future.”
GNB Financial is wholly owned by Starmites Corp., the financial holding company of the Gilinski Group, which has about US$15 billion in combined assets.
CIBC First Caribbean operates in 16 countries in the region and offers a range of financial services including corporate, retail and business banking as well as wealth management.
CIBC expects to record an after-tax loss on the transaction of about C$135 million in the fourth quarter ended Oct. 31. Upon closing, CIBC expects to realize foreign currency translation gains estimated at C$280 million. (PR)