ZCZC
BCN-08
VIRUS-GERMANY-BANKING-EARNINGS-COMMERZBANK
Heavy losses at Commerzbank as virus takes its toll
FRANKFURT AM MAIN, May 13, 2020 (BSS/AFP) – Germany’s second-largest lender
Commerzbank sank into a loss in the first quarter as it took a hit of 479
million euros over the coronavirus pandemic, it said Wednesday.
The Frankfurt-based bank reported a net loss of 295 million euros ($320
million) for January-March — compared with a profit of 122 million euros
during the same period in 2019.
Analysts reviewed by Factset predicted a loss of just 71 million euros.
The lender blamed the heavy losses on “temporary valuation effects” and “a
higher risk provision booked on account of the pandemic”.
The group has not provided a firm forecast for 2020.
“In view of the uncertainty about the further development of the pandemic,
it is difficult to provide a concrete outlook,” it said.
Assuming that the economy will gradually recover as a lockdown over the
coronavirus is lifted and with no new restrictions introduced, Commerzbank
expects its banking revenues to be largely stable in 2020.
On Monday, Commerzbank said it had abandoned plans to sell off its
lucrative Polish subsidiary mBank, blaming unfavourable conditions caused by
the coronavirus.
Commerzbank, which has been partly state-owned since the financial crisis
of 2008, had been in talks to merge with crosstown rival Deutsche Bank.
But the bid to join forces failed early last year, leading the bank to
slash 4,300 jobs to bring its headcount down to just over 40,000.
Commerzbank reported net profit of 644 million euros for 2019.
BSS/AFP/MMA/1610HRS