Fitch Rates CIBC's CARDS II Trust, Series 2016-1

NEW YORK--()--Fitch Ratings has assigned the following ratings to Canadian Imperial Bank of Commerce's (CIBC) CARDS II Trust, series 2016-1 credit card receivables-backed USD floating-rate class A and CAD floating-rate class B notes:

--USD750,000,000 class A notes 'AAAsf'; Outlook Stable;

--CAD76,512,000 class B notes 'BBBsf'; Outlook Stable.

KEY RATING DRIVERS

Fitch's ratings are based on the underlying receivables pool, available credit enhancement, Canadian Imperial Bank of Commerce's underwriting and servicing capabilities, and the transaction's legal and cash flow structures, which employ early amortization triggers.

RATING SENSITIVITIES

Fitch models three different scenarios when evaluating the rating sensitivity compared to expected performance for credit card asset-backed securities transactions: 1) increased defaults; 2) a reduction in purchase rate, and 3) a combination stress of higher defaults and lower monthly payment rate (MPR).

Increasing default rate alone has the least impact on rating migration even in the most severe scenario of a 75% increase in defaults. The rating sensitivity to a reduced purchase rate is more pronounced with a severe stress, of a 100% decrease, and leads to possible downgrades of the class A notes. The harshest scenario assumes both default and MPR stresses occur simultaneously. Similarly, the ratings would only be downgraded under the moderate stress of a 50% increase in defaults and 25% reduction in MPR; however, the severe stress could lead to more drastic downgrades to all classes.

To date, the CARDS II Trust transactions have exhibited strong performance with all performance metrics within Fitch's initial expectations. For further discussion of Fitch's sensitivity analysis, please see the related presale report. For a discussion of the representations, warranties, and enforcement mechanisms available to investors in this transaction please see the related presale appendix.

DUE DILIGENCE USAGE

No third-party due diligence was provided or reviewed in relation to this rating action.

The presale report is available to all investors on Fitch's website at 'www.fitchratings.com'. For more information about Fitch's comprehensive subscription service FitchResearch, which includes all presale reports, surveillance, and credit reports on more than 20 asset classes, contact product sales at +1-212-908-0800 or at 'webmaster@fitchratings.com'.

Additional information is available at www.fitchratings.com.

Applicable Criteria

Counterparty Criteria for Structured Finance and Covered Bonds (pub. 18 Jul 2016)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=884963

Criteria for Interest Rate Stresses in Structured Finance Transactions and Covered Bonds (pub. 17 May 2016)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=879815

Criteria for Servicing Continuity Risk in Structured Finance (pub. 17 Dec 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=875586

Global Credit Card ABS Rating Criteria (pub. 21 Jul 2016)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=885146

Global Structured Finance Rating Criteria (pub. 27 Jun 2016)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=883130

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=1009555

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=1009555

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31

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Contacts

Fitch Ratings, Inc.
John Alberici
Associate Director
+1-212-908-0370
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst
Stephanie Lobaccaro
Analyst
+1-212-908-0769
or
Committee Chairperson
Herman C. Poon
Senior Director
+1-212-908-0847
or
Media Relations
Sandro Scenga, +1-212-908-0278
sandro.scenga@fitchratings.com

Contacts

Fitch Ratings, Inc.
John Alberici
Associate Director
+1-212-908-0370
Fitch Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary Analyst
Stephanie Lobaccaro
Analyst
+1-212-908-0769
or
Committee Chairperson
Herman C. Poon
Senior Director
+1-212-908-0847
or
Media Relations
Sandro Scenga, +1-212-908-0278
sandro.scenga@fitchratings.com