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Deutsche Bank and Commerzbank go public on merger talks

18 March 2019 [12:31] - TODAY.AZ
By  Trend

Deutsche Bank and Commerzbank confirmed on Sunday they were in talks about a merger, although both cautioned that a deal was far from a foregone conclusion, Trend reported citing Reuters.

Germany’s two largest banks issued short statements following separate meetings of their management boards, a person with knowledge of the matter said, indicating a quickening of pace in the merger process.

“In light of arising opportunities, the management board of Deutsche Bank has decided to review strategic options,” Deutsche said in its statement.

Christian Sewing, Deutsche Bank’s chief executive, told employees in a note that Deutsche still aimed “to remain a global bank with a strong capital markets business...with a global network”.

Sewing also said that “experience has shown” that many economic and technical factors could prevent a merger. For its part, Commerzbank described the outcome as open.

Formal disclosure of talks appears to boost the chances of concluding a deal floated in 2016 before the banks opted to focus on restructuring and which has since been the subject of renewed speculation.

The German government has pushed for a combination given concerns about the health of Deutsche, which has struggled to generate sustainable profits since the 2008 financial crisis.

The government, which holds a stake of more than 15 percent in Commerzbank following a bailout, wants a national banking champion to support its export-led economy, best known for cars and machine tools.

Berlin also wants to keep Commerzbank’s speciality - the funding of medium-sized companies, the backbone of the economy - in German hands.

“We are going to seriously evaluate a merger,” said the person with knowledge of the matter ahead of the announcement.

A person with knowledge of the matter had earlier this month told Reuters that the management board of Deutsche had agreed to hold talks with Commerzbank on the feasibility of a merger.

A merged bank is likely to rank as the third largest in Europe behind HSBC and BNP Paribas.

URL: http://www.today.az/news/regions/180428.html

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