Earnings

Commerzbank downplays merger plans in the near future

CNBC with Reuters
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Key Points
  • Net profit of 271 million euros ($303.79 million) in the quarter was better than the 217 million euros expected by analysts and compares with 272 million euros a year earlier.
  • Revenues fell to 2.129 billion euros in the second quarter, from 2.178 billion a year earlier. That was slightly lower than the 2.135 billion expected.
Commerzbank CFO: Don't see M&A on the agenda
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Commerzbank CFO: Don't see M&A on the agenda

Germany's second largest lender is not planning a merger in the near future, the bank's CFO told CNBC after the failed talks with Deutsche Bank earlier this year.

Commerzbank and Deutsche Bank announced in April the collapse of merger talks. They argued that that the need for extra capital, restructuring costs and execution risks made the potential merger not viable. Both banks combined would have created one of the largest banks in Europe.

"For the time being I don't see (a merger) in the agenda," Stephan Engels, chief financial officer of Commerzbank, told CNBC's Joummana Bercetche Wednesday.

"On the one hand it is obviously something that makes sense on the spread sheet level, but it needs a proper opportunity and a proper environment, and I am not sure whether the current environment really is the proper environment to start discussions like that," Engels added.

Commerzbank on Wednesday posted net profit in the second quarter that was little changed from a year ago, helped by low taxes, but the German bank said its target for a slight increase in full-year net profit had become "significantly more ambitious".

Shares moved about 3% lower in early afternoon trade in Europe.

Net profit of 271 million euros ($303.79 million) in the quarter was better than the 217 million euros expected by analysts and compares with 272 million euros a year earlier.

Commerzbank is working on a new strategic plan that it will present later this year after talks to merge with Deutsche Bank were discontinued in April.

Revenues fell to 2.129 billion euros in the second quarter, from 2.178 billion a year earlier. That was slightly lower than the 2.135 billion expected.

But the bank stuck to its forecast that underlying revenues would be higher in 2019 than in 2018.

The failure of talks with Deutsche raised questions about Commerzbank's future as a stand-alone bank and some foreign banks had expressed interest in taking it over.