Commerzbank income surge in enhance to takeover defence | USAEMALL.com

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Commerzbank has reported its biggest quarterly profit for more than a decade, in a boost for the German bank as it attempts to remain independent amid takeover interest from Italy’s UniCredit.

Germany’s second-largest lender said on Friday that net profit rose 12 per cent year on year to €834mn in the first quarter, significantly ahead of analysts’ expectations of €698mn.

Total revenues climbed 12 per cent to €3.1bn, driven by stronger than expected interest and commission income. Loan loss provisions came in at just €123mn, well below the €162mn forecast by analysts, who had anticipated stronger increases after the economic turbulences following the US’s tariff announcements.

“We achieved the highest quarterly profit since 2011, demonstrating that we can grow even in economically challenging times,” said chief executive Bettina Orlopp, who took over in October.

The results come as Commerzbank seeks to strengthen its case for remaining independent following pressure from UniCredit. The Italian lender has amassed a 28 per cent stake in Commerzbank, including through derivatives, and last month received clearance from both Germany’s antitrust authority and the European Central Bank to increase its direct shareholding to just under 30 per cent.

Commerzbank’s shares have surged more than 70 per cent over the past 12 months, reflecting growing investor confidence in the bank’s prospects and takeover speculation.

Orlopp in February outlined a standalone strategy aimed at fending off UniCredit’s advances, including plans to cut 3,900 jobs and boost profitability by two-thirds by 2028 compared with 2024 levels.

On Friday, management said talks with labour representatives over job reductions were “progressing well”, after unions called for a demonstration in favour of the bank’s independence ahead of its annual general meeting next week.

Commerzbank staff and management have voiced strong resistance against UniCredit. The German government, which still holds a 12 per cent stake following the bank’s bailout during the financial crisis, has yet to endorse any deal.

UniCredit has indicated that it would seek approval from Berlin before pursuing a formal takeover. Its separate bid for Italian peer Banco BPM has stalled amid new conditions imposed by Rome.