At the request of Deputy Chairman of the Supervisory Board, Uwe Tschäge, a special meeting of the Supervisory Board will take place on 21 May at 3 pm, as several people familiar with the topic told Handelsblatt. At the meeting, the board must explain in detail why it has completed the merger talks with Deutsche Bank and what strategic plans it now pursues.
According to financial circles, the representatives of the Federal Government in the Commerzbank Supervisory Board also voted in favor of the special meeting. The state still holds a good 15 percent of the institute after the rescue in the financial crisis.
The big question is whether Commerzbank can survive on its own or be swallowed by a foreign bank. The Dutch ING and the Italian Unicredit, according to financial circles, have in principle signaled interest in Berlin in the past. Concrete discussions did not exist so far however.
This Tuesday Unicredit denied media reports that the institute had commissioned investment banks to prepare a purchase of Commerzbank. Also, the board of Germany's second largest private bank does not expect in the near future with takeover offers. So far, no one knocked, said CFO Stephan Engels recently. He sees a bidder competition for the Commerzbank at the moment "really not come".
Engels' remarks did not come from the gut, but they also relied on an internal analysis of the board. The top management had counted for the strategy meeting in the fall of 2018 several possible mergers.
It came out according to Handelsblatt information that the synergies in a merger with Deutsche Bank would be by far the largest. Unicredit and its German subsidiary Hypo-Vereinsbank followed at some distance.
According to the calculations of the management, synergies would have been significantly lower in a merger with ING, which in Germany was previously active only as a direct bank, and all other potential partners. Analysts at US bank Citi come to a similar conclusion this week in a roughly 50-page analysis.
Financially, a takeover of Commerzbank for ING and Unicredit would be "difficult to justify," they said. According to Citi, a deal would be attractive for both institutions if they relocate their headquarters to Germany – because then the financing costs and capital requirements could fall.
The probability that the ING will buy the Commerzbank, the Citi experts estimated at 35 to 45 percent. At Unicredit, they see a 20 percent chance.
The shareholders of Commerzbank, which is currently valued at € 9.4 billion on the stock exchange, are also realizing the question of a possible takeover. "Commerzbank is better positioned than Deutsche Bank and can currently manage well on its own," says an investor who is involved in both financial institutions. "Whether Commerzbank can survive alone on a long-term basis is open."
From the point of view of Michael Hünseler, the managing director of asset manager Assenagon, it is only a matter of time before Commerzbank is swallowed. "The bank will not survive on its own in the long run," says Hünseler.
The Germany-focused business model does not work because profit margins are too low due to fierce competition and the interest rate environment. "Customer numbers and the growth of Commerzbank are solid, but in the end it will simply hang on little profit."
The strategy of CEO Martin Zielke focuses on growth in private and corporate client business. But Zielke acknowledged at the beginning of the year that the bank can not currently generate internationally competitive returns in the Federal Republic.
During the merger talks with Deutsche Bank, Zielke then explained on the intranet of the institute that its own strategy was working. "However, organic growth has one drawback: it takes time to increase market share substantially." That's why the bank is simultaneously reviewing "all the external growth options we have".
According to these statements, many Commerzbank employees had the impression that Zielke spoke badly about their own bank. And they see the CEO today also because of the talks with the hated Deutsche Bank critical.
The relationship between workers' representatives, who fought loudly against a German big bank wedding, and management has also noticeably deteriorated. Some workers' representatives want to be heard early in the debate on a new strategy to be presented in the autumn.
When the head of the bank informed the Supervisory Board of Commerzbank in a telephone conference on April 25 about the canceled Deutsche Bank merger, the ruling committee immediately called for a special meeting.
Merger with BayernLB in conversation
Supervisory Board Chairman Stefan Schmittmann rejected these demands for information of the Handelsblatt, however, first in clear words. He considered that the panel had been sufficiently informed about the discussions – in several plenary sessions and at meetings of a special committee of the Supervisory Board on the merger.
But in the end Schmittmann had to back down. His deputy, Tschäge, who is also chairman of the works council of Commerzbank, forced the meeting with his proposal, which is now scheduled to take place one day before the Annual General Meeting on May 22. Commerzbank did not comment on the meeting and possible takeovers.
It is conceivable that the meeting not only talks about cross-border mergers, but also about a German option. For in Berlin and Frankfurt, the rumor has been circulating for a few days that Commerzbank can also partner with Bayerische Landesbank (BayernLB).
Concrete discussions between the two financial institutions have not yet been made, according to financial circles – and many bank managers also consider such a scenario unlikely. Hardly anyone wants to completely exclude it, after all, Commerzbank last year also reviewed a takeover of NordLB.
Commerzbank (t) Deutsche Bank (t) Banking merger (t) UniCredit (t) ING (t) BayernLB (t) Mergers & Acquisitions M & A (t) Unicredit (t) HVB (t) Assenagon (t) NordLB (t) Martin Zielke (t) Michael Hünseler (t) Stefan Schmittmann (t) Stephan Engels (t) Uwe TschÃ¤ge (t) Banks & Credit Institutions