CIBC says it has taken steps to create alternative options in case it decides not to renew its Aeroplan credit card agreement with Aimia, which is set to expire at the end of the year.

"While the launch of the alternative card would result in short-term costs for CIBC, we believe it would generate benefit over the longer term for our clients and shareholders," CIBC president and chief executive Gerry McCaughey said during a conference call Thursday.

McCaughey said the bank is investing $50 million over the next four quarters, including $30 million before the end of fiscal 2013, to build these alternatives.

But he also didn't rule out the possibility of renewing the existing contract with Aimia, a loyalty rewards company that has partnered with the bank for more than two decades to create the popular CIBC Aerogold Visa.

"Our primary objective is to ensure that one way or another, we offer our clients a market-leading travel credit card," McCaughey told investors and analysts.

The comments came as CIBC announced a second-quarter profit of $876 million, up eight per cent from last year and ahead of analyst estimates.

The bank also said it will be raising its dividend by two per cent starting with the July payout.

The profit for the three months ended April 30 amounted to $2.12 per share in net income while its adjusted net income was also $2.12 per share — four cents above the consensus estimate compiled by Thomson Reuters.

CIBC's quarterly dividend will be increased by two cents to 96 cents per common share, which will be paid July 29 to shareholders of record as of June 28.

CIBC's retail and business banking segment accounted for most of the second-quarter profit — $604 million of net income, which was up $48 million or nine per cent from the same time last year.

Wealth management contributed $92 million while wholesale bank added $198 million of net income to CIBC's bottom line.

CIBC and Royal Bank of Canada (TSX:RY) were the last of Canada's big banks to report their second-quarter results. All the banks showed increased profits compared with last year — although some banks missed analyst estimates.

At CIBC, the reported net income was up from $811 million a year earlier and adjusted net income compared with $840 million in the second quarter of 2012. Adjusted EPS was up from $2 a year earlier and net income before adjustments was up from $1.90 in the second quarter of 2012.

Total revenue was $3.13 billion in the three months ended April 30, up from $3.08 billion in the second quarter of 2012.