Commerzbank to slash 4 300 jobs as cost cuts stepped up

Mon, 01 Jun 2020

Commerzbank to slash 4 300 jobs as cost cuts stepped up

News24
21 Sep 2019, 04:14 GMT+10

Commerzbank AG is planning to cut 4 300 jobs as part of a new strategic plan that will also see the bank sell a stake in its Polish mBank unit to reduce risk and help pay for the measures.

Germany's second-biggest listed bank plans to close 200 branches as part of the measures, and buy the 18% it doesn't yet own in its online bank Comdirect Bank AG, according to a statement Friday. It's the bank's biggest overhaul since Chief Executive Officer Martin Zielke three years ago announced his strategy of focusing on lending to retail and corporate clients in its home market.

Since then, a weaker economy and the prospect of even lower interest rates have forced Zielke give up many of the mid-term targets in his current turnaround plan, which runs through 2020. That plan had aimed to cut headcount by 7 300, though the bank since revised that number to less than 5 300. Merger talks with Deutsche Bank AG collapsed earlier this year.

The new measures do "little to enhance the lender's investment case or appeal to a potential suitor," said Philip Richards, an analyst at Bloomberg Intelligence. It "doesn't suggest earnings recovery or a credible stand-alone plan is in the offing."

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