Commerzbank to cut branches, jobs after Deutsche merger fails

FRANKFURT: Commerzbank said it wanted to shed thousands of staff and close a fifth of its branches in a strategy overhaul, after the German lender’s attempt to merge with Deutsche Bank failed.
The bank, partly owned by the German government after a bailout and struggling to generate profits, also aims to sell a stake in its Polish subsidiary mBank and absorb its Comdirect online brokerage unit.
Commerzbank said the strategy plan would involve investment of 1.6 billion euros ($1.8 billion), with 750 million euros going into new technology and the rest earmarked for restructuring.
The bank said the draft measures would be discussed at a meeting of the supervisory board on September 25 and 26. It said no final decision had yet been taken. Shares in Commerzbank, which has been reviewing strategy in recent weeks, were 0.8 per cent higher in late afternoon trade, with some investors saying the measures were not enough.
Klaus Nieding, vice president of shareholder lobby group DSW, said the bank needed to do more than cut costs. “The big question remains how the bank wants to make money in the future,” he said.
The bank was ejected from the blue-chip DAX index last year, highlighting the challenge facing banks in Europe’s biggest economy since the global financial crisis. The bank said it would cut 4,300 jobs in some places but add 2,000 jobs in “strategic areas”, so the group headcount would fall in total by about 2,300 full-time positions. — Reuters