News

CIBC shuts down U.S. supermarket banking

November 17, 2002

TORONTO -- Canadian Imperial Bank of Commerce (CIBC) says it is closing its U.S. electronic banking operations, CIBC National Bank and Amicus FSB, subject to regulatory approval.

CIBC National Bank provides financial services under the Marketplace Bank brand which operates in Winn-Dixie Stores in Florida,and Amicus FSB provides financial services under the Safeway SELECT Bank brandat Safeway supermarkets, mostly in California.

The Nov. 14 announcement followed an Oct. 21 statement that the bank might scale back or close its U.S. supermarket banking division because it wasn't meeting financial expectations.

(See related story Amicus seeks capital to stay afloat)

The closures are part of a broader move by the bank to eliminate more than 700 jobs under a cost-cutting program and to focus on more profitable businesses.

Amicus, which employs about 1,000 people, was believed to be losing $39 million a quarter, mostly from the U.S. operations. The cuts will not affect its Canadian operations, with branches at Loblaws stores.

According to the CIBC Web site, all customers will be notified in writing with the details they need for the transition. Customer deposits with a balance of $1,000 or more on the date of closing, as well as all customers who purchased certificates of deposit, will be transferred to E*TRADE Bank, subject to regulatory approval.

Amicus will turn off deposit features at ATMs by the end of the month, according to CIBC, and will begin shutting down its supermarket pavilions. Electronic withdrawals will be available until accounts are transferred or closed.

It is not clear how operations of XtraCash ATM, the San Diego, Calif.-based ISO purchased by Amicus in early 2001, will be affected. An unidentified XtraCash employee told ATMmarketplace he is "taking it a day at a time." XtraCash has more than 7,500 ATMs under contract.