Germany’s SECOND biggest bank Commerzbank posts unexpected massive loss
GERMANY’S second biggest bank Commerzbank is facing an uncertain future after posting massive losses of more than €400 million today.
Germany’s SECOND biggest bank Commerzbank posts unexpected massive loss
The catastrophic loss, which equates to £363m, is huge reversal of last year’s €380m profit.
The 147-year-old Frankfurt-based giant has slashed more than 7,000 jobs and has earmarked a further €807m (£720m) to mitigate against job cuts following severance agreements with works councils.
Bosses have said the bank is in midst of a restructuring.
Commerzbank announces the cut of 9,600 jobs
In customer growth, we are above plan, also because we have invested
The first half losses were higher than analysts had previously expected.
But in a report out today bank bosses point to spending on customer acquisition and the digitisation of the business.
Since the start of the conversion in October, Commerzbank has won more than half a million customers, while the subsidiary Comdirect contributed 100,000 by acquiring the online broker Onvista.
The loss, which equates to £363m, is huge reversal of last year’s €380m profit
CEO Martine Zielke said: "In customer growth, we are above plan, also because we have invested.
"However, some time will elapse before this is reflected in profit growth."
Stephan Engels, the bank’s finance chairman, said he was expecting a "slightly positive" result for the year as a whole.
Mr Engels said he was expecting a 'slightly positive' result for the year as a whole
Plans to sell the bank’s Frankfurt HQ Commerzbank Tower to the South Korean Samsung Group will raise €220m.
The bank will remain a tenant in the tallest building in Germany.
Further capital will be raised by the ending of a credit joint venture with the French bank BNP Paribas and the selling of the shares of the company providing credit services Concardis to Bain Capital and Advent will bring in €90m.