Commerzbank mulls capital hike to repay state bailout
GERMANY’S second biggest lender Commerzbank said it is considering a capital increase and divestments among options for repaying €16.4bn (£14.8bn) in government bailout money.
In January, Germany took a 25 per cent stake in Commerzbank as part of an €18.2 rescue package to stabilise the lender, which was rocked by the financial crisis and its takeover of rival Dresdner Bank.
Commerzbank said it would repay the government’s tranche of non-voting capital contribution by 2012 at the latest.
The lender completed the acquisition of Dresdner at the height of the fallout from the collapse of Lehman Brothers. Initial costs of integrating Dresdner are set to hit €2.5bn – €500m more than expected.
For 2009, Commerzbank expects charges of €6bn, of which €4.3bn will be loan-loss provisions.
The Frankfurt-based lender said crisis-related charges would continue in 2010 but are expected to decrease.
Loan-loss provisions are expected to fall to around €2bn by 2012.
Commerzbank reaffirmed it expects to achieve revenue of just below €14bn in 2012.