Don't expect a dividend: Commerzbank CEO
The CEO and Chairman of Commerzbank has told CNBC its fourth-quarter earnings were "solid," after the lender returned to profit, but warned investors it was best not to expect a dividend in 2014.
Germany's second-biggest lender said its turnaround plan was ahead of schedule, as it had unloaded non-core assets such as shipping and commercial real estate faster than expected.
"We have been able to increase our capital ratio and we have been faster in reducing our non-core assets," Martin Blessing told CNBC on Thursday. "The core bank is solid, so it is a solid result."
The Frankfurt-based bank posted net profit of 64 million euros ($87 million) in the fourth quarter, beating expectations and recovering from a 726 million euro-loss a year ago.
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"Since we have already reduced our non-core [assets] faster, the average amount that we have on our books is now roughly 18 billion euros below what we planned," Blessing said.
However, he warned that shareholders should not expect to a dividend in 2014.
"We always said that it is very unlikely that we would pay a dividend 2013 and we will not recommend paying one to our annual shareholder meeting," Blessing said.
"It is too early to tell for 2014 — we have the stress tests of the ECB (European Central Bank) ahead and therefore we think it is better for investors to be cautious. You don't get disappointed if you don't expect a dividend for 2014," he added.
He denied that impending stress tests had made the bank more cautious about lending in order to boost its performance — a measure the ECB has said some banks were taking ahead of the tests, the results of which are expected to be published in October.
(Read more: Deutsche Bank tumbles, warns of 2014 headwinds)
"We increased our lending to German mid-corporates by about 6 percent, we increased our lending volume in the area of private mortgages, these areas which we consider a core area for the future. In other areas that we consider non-core, such as ship finance and commercial real estate, we are reducing lending volumes, but that is not a specific measure ahead of the ECB tests," he said.
The bank's shipping arm, which previously had one of industry's largest loan books in the world, is expected to come under intense scrutiny when the ECB tests the bank.
Blessing said the lender was "well-prepared" in that respect, as the shipping portfolio has been reduced significantly.
"We already by 2013 have reached our reduction goal for 2016. With this amount, we think that we are well prepared for stress tests," he said.
Shares of Commerzbank closed around 1.5 percent higher on the Frankfurt stock exchange.