Commerzbank Reports Bigger than Forecast Loss

Commerzbank unveiled a revamped board structure and restructuring program as Germany's second largest bank reported a bigger-than-expected net loss on Friday.

The quarterly loss came to 861 million euros (US$1.15 billion), worse than the average analysts forecast of 719 million euros in a Reuters poll. A year earlier, Commerzbank had posted a net profit of 236 million euros, adjusted for the takeover of Dresdner Bank.

The Frankfurt-based bank which has been battered by writedowns on debt products related to the U.S. residential mortgage market unveiled bullish targets as part of its planned overhaul, which included a reshuffle of the board.

Commerzbank said it wanted to return to profitability no later than 2011, as well as operating profit of more than 4 billion euros a year from 2012.

The bank had a first-quarter operating loss of 591 million euros, hit by a 1.2 billion euros charge from the investment bank and a 54 million euro charge from its commercial real estate unit.

In the January to March period 2008, Commerzbank had made a 470 million euros operating profit.

Portfolios that include asset backed securities, mortgage-backed securities and various types of credit derivatives totaling some 38 billion euros would be merged into a restructuring unit, the company said.

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