Bermuda Bank agrees to buy a 91.7% stake in CIBC Caribbean Bank for $1.8 billion, creating a regional giant.
This article appears in the July/August issue of Global Finance Magazine.
Butterfield Group has agreed to acquire a 91.7% stake in CIBC Caribbean Bank Ltd. for $1.8 billion – $1.09 billion in cash and the rest in shares – in a deal that will create one of the region’s largest banking groups.
This is at least the third time in the past seven years that Canadian Imperial Bank of Commerce (CIBC) has attempted to sell some of its Caribbean interests.
“This deal combines two storied, complementary banks with significant local scale advantages and time-honored customer relationships in their respective core jurisdictions,” Butterfield Chairman and Chief Executive Michael Collins said in a statement.
The new banking group will have an estimated $29 billion in assets. Bermuda-based Butterfield Group—formerly Bank of NT Butterfield & Son Limited—also operates in the Bahamas, Cayman Islands, Channel Islands, Singapore, Switzerland and the UK CIBC, which has a presence in 10 countries and is based in Barbados.
CIBC will own about 22% of the expanded Butterfield Group and have the right to appoint two directors to the board.
The bank’s top executives say the deal underscores a transformation of the Caribbean financial sector.
Mariano Brown, former CEO of Butterfield, told the Trinidad and Tobago Guardian, “It’s really a change in Butterfield’s position because it now picks up both a retail and business portfolio that spans the entire scope of the region, and that could probably make it the largest bank in the region.”
Butterfield has promised to maintain CIBC’s Barbados office. Customers should not expect any immediate changes. Existing branches will remain open, and customers can expect improved cross-border payments and expanded consumer, digital and merchant banking.
The deal, pending regulatory approval, should close in the first half of 2027.
In 2018, CIBC attempted to list FirstCaribbean on US stock exchanges to raise up to $240 million, but withdrew the application less than a month after failing to garner sufficient investor interest. CIBC’s 2019 deal to sell 66.7% of GNB Financial Group to GNB Financial Group for $797 million fell through after failing to receive regulatory approval.
Nick Wirtz is a contributing writer based in Guatemala.