News Column

Commerzbank bounces back as economic recovery cuts bad loans

August 8, 2014

TIM WALLACE



PROFITS more than doubled at Commerzbank in the second quarter, the German lender said yesterday.


The improving economic picture slashed its bad loan volumes, improving its earnings overall.


And the bank accelerated the sale of its crisis-era toxic assets, again cutting its bad loan provisions.


Profits came in at 100m (79.3m) for the second quarter, more than double the 40m in the same period of 2013.


Commerzbank's retail banking arm performed strongly, raising operating profits from 54m to 115m.


But its corporates and markets business turned in weaker figures, in part because of the ongoing squeeze hitting the bond markets.


Fixed income trading revenues helped drag down the unit's profits by 24 per cent on the year to 402m in the three-month period.


The bad bank part of the group saw its assets shrunk by 32 per cent on the year to 92bn. And Commerzbank now hopes to cut that to 67bn by 2016.


The bank's shares stayed flat, edging up just 0.09 per cent on the results.


Commerzbank AG 10.90 10.46 7 Aug 10.80 10.70 10.60 10.50 10.40 10.30 6 Aug 7Aug 1Aug 4Aug 5 Aug


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Source: City A.M. (UK)


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