Germany's Commerzbank Staff Protest UniCredit Takeover Threat
Dressed as a Gallic warrior fighting Roman invaders or wearing the yellow of the Commerzbank logo, employees from the German lender protested Thursday against any takeover attempt by Italy's UniCredit.
About 200 staff staged the demonstration outside the annual shareholders' meeting of Commerzbank in the German city of Wiesbaden, as the lender fights back against advances from its Italian peer.
UniCredit has built up a hefty stake in Commerzbank since last year, sparking speculation it could seek to swallow up Germany's second-biggest lender, in a move that shocked Berlin's corporate and political elite.
"We want to stay independent because we think it's better for us," said Christine Pfeiffenberger, 52, a bank employee who held a banner with the slogan "my heart beats in yellow" written in Italian.
Another demonstrator, Denis Krutikov, 50, said shareholders "need to ask themselves if it is a good idea to merge with UniCredit whilst workers are against the idea".
One protester, inspired by the Asterix comic series, was dressed as a Gallic warrior and held a sign showing someone being flattened by a menhir, the giant sculpted rocks that Asterix's companion Obelix carries around.
Commerzbank has fought back fiercely against UniCredit's moves, and chief executive Bettina Orlopp told shareholders at Thursday's meeting that the group aimed to become a "key" European bank.
The bank last week reported its best quarterly profit since 2011 and has also announced thousands of job cuts and share buybacks in a bid to make itself more attractive to shareholders.
The saga began in September when Italy's second-biggest lender revealed its had built up a stake in its German rival, triggering talk that CEO Andrea Orcel wanted to push for an ambitious pan-European banking merger.
UniCredit has since boosted its holding via shares and derivatives to around 28 percent.
It has also received the green light from regulators to buy up to 29.99 percent of Commerzbank, just below the level at which it would be required by law to make an offer for all of the bank.
Financial news agency Bloomberg reported Wednesday that Orcel had written to new German Chancellor Friedrich Merz in a bid to start talks.
But Merz has previously spoken out against UniCredit's moves.
And Orcel has played down the prospect of mounting a takeover bid for Commerzbank soon, saying in March that he could wait until 2027 to determine whether it made sense.
Commerzbank's shares have risen 60 percent since the start of the year, making any takeover more expensive, and might soon exceed the price the German government paid for its stake in 2008 during the financial crisis. About 200 people protested outside the bank's annual general meeting in Wiesbaden, western Germany AFP Commerzbank has come under pressure as UniCredit under CEO Andrea Orcel has steadily built up a stake in the Frankfurt-based firm AFP
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DW
2 hours ago
- DW
NATO likely to hike defense spending despite economic woes – DW – 06/05/2025
The military alliance looks set to satisfy US President Donald Trump's demands to commit to a massive increase in defense spending. Some creative counting proposed by NATO head Mark Rutte could soften the financial blow. A NATO defense ministers' meeting in Brussels on Thursday showed "broad support" for signing off a historic hike in defense spending at a crunch summit later this month. This was their response to the growing threat from Russia and a "more dangerous world" in general, the military alliance's Secretary General Mark Rutte told reporters. "I will propose an overall investment plan that would total 5% of gross domestic product in defense investment," Rutte announced, following months of pressure from US President Donald Trump for allies to more than double the present target. Current NATO guidelines encourage states to spend 2% of their economic output on their militaries. But not all of the alliance's members meet this target, raising questions of how they will reach an even higher spending goal. Splitting the bill In response, NATO chief Rutte has specified a division of the new spending goal that could allow Trump to claim a headline figure, while giving the other 31 nations room to maneuver their national budgets. Thus, of the 5%, 3.5% of national GDP could be allotted to "core defence spending", while the remaining 1.5% could be diverted to "defense- and security-related investment like infrastructure and industry," he said. Allied defense ministers gathered at the NATO headquarters in Brussels Image: Dursun Aydemir/Anadolu/picture alliance Trump has long criticized NATO allies for relying on the US' large military might as a strategy to defend the European continent. In 2023, more than two thirds of the 32 NATO countries' collective $1.3 trillion (€1.14 trillion) military spending came from Washington, according to data compiled by the Stockholm International Peace Research Institute (SIPRI). On Thursday, US Secretary of Defense Pete Hegseth drove home the message to the rest of the alliance once again. "Every shoulder has to be to the plough. Every country has to contribute at that level of 5% as a recognition of the nature of threat," he said. Leaders of the world's most powerful defense alliance are set to gather in three weeks in the Dutch city The Hague. Topping the agenda will be discussions on the ongoing war in Ukraine, and Russia's resulting massive rearmament drive. It seems likely that NATO members will officially commit to the 5% goal at these upcoming talks. Giving in to pressure Under US pressure, and with Europeans alarmed by Russia's full-scale invasion of Ukraine in 2022, NATO military spending has already burgeoned in recent years. Most countries now meet the 2% threshold, which was agreed upon 11 years ago. But around one third of the alliance still doesn't, including Portugal, Italy, Canada, Belgium, and Spain. Most NATO states had indicated willingness to spend more, but the 5% goal was considered far-fetched when Trump floated the idea earlier this year. Almost half a year on, the message seems to be resonating with many in the alliance. Earlier this week, 14 NATO states, including the Czech Republic, Hungary, Poland and the five Nordic states, published a joint statement in which they said they were "moving towards reaching at least 5% of GDP on defense and defense-related investments." Specter of war: Are Europeans really ready to rearm? To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video Last month, German Foreign Minister Johann Wadepuhl also indicated Germany could get on board with the goal. Several NATO countries, including Poland, Estonia and Lithuania, have already committed to spending 5% or more in the future. All are former Soviet states, and two of them share a border with Russia. Since taking office in January, the "America-first" president has strained the NATO alliance with threats not to help defend alliance members that didn't meet spending targets should they be attacked. His designs on the semi-autonomous Danish territory Greenland have also alienated allies, as have his attempts at bilateral talks to find an end to Russia's war in Ukraine, which sidelined European partners and left Ukrainian President Volodymyr Zelenskyy largely marginalized. Questions remain There are still many open questions to be answered, one of them being the timeline. On Thursday, Estonian Defense Minister Hanno Pevkur spoke of committing to reaching 5% within five years. "We don't have time for ten years, we don't even have time for seven years, to be honest," he said. But the official focus at this week's meeting was on working out what exact capabilities NATO would need and may currently be missing to defend itself if a member of the alliance were attacked. After the talks, Rutte spoke of the need to upgrade air defense systems and long-range missiles, among other things. German Defense Minister Boris Pistorius said Germany might need as many as 50,000 – 60,000 more troops in its standing forces to meet defense needs in the coming years. Increased spending amid economic downturn While consensus appears to be forming, it is also clear that increasing military spending to 5% of GDP would be an enormous strain on public finances, particularly as Europe's two major economies, Germany and France, face tough times. Paris and Berlin are touting increased defense spending as a chance to fuel economic growth in Europe, but there is a risk of public backlash. In April in Rome, the opposition Five Star Movement led a protest against an EU drive to rearm the bloc — a move supported by the government of far-right Prime Minister Giorgia Meloni — reportedly drawing tens of thousands of people. According to Cullen Hendrix, an expert from the Peterson Institute for International Economics, a US think tank, a 5% spending target would essentially put NATO countries on "war footing." US secretary of State Pete Hegseth was in Brussels for the last NATO gathering before next month's summit Image: Bob Reijnders/Middle East Images/AFP/Getty Images "In 2023, just nine countries spent 5% of GDP or more on defense: Algeria, Armenia, Israel, Lebanon, Oman, Russia, Saudi Arabia, and South Sudan," Hendrix wrote in February. "Most are, or were, at war. Five of these are authoritarian petro-states, unencumbered by competitive elections or the need to tax their populaces to fund this military largesse." There is also a risk that increased spending will make Europe less safe, Hendrix warned. "Increasing military spending to this extent would likely catalyze an arms race with those near-peer competitors." On Thursday in Brussels, Rutte argued there was little choice but to spend significantly more on defense, pointing to recent comments by the German Chief of Defense Carsten Breuer, who posited that Russia would be ready to mount an attack on NATO states by 2029. "We live in a more dangerous world," Rutte said. "We are safe today, but if we don't do this, we are not safe in the foreseeable future." Edited by: Maren Sass
Local Germany
4 hours ago
- Local Germany
OPINION: It's high time Germany scrapped the rent brake
As Bundestag debates the planned second extension of Mietpreisbremse rent controls until 2029 and is almost certain to pass it, I have a question: isn't it actually high time we got rid of the 'rent brake'? Your first reaction – especially if you are one of the 50 percent of German households living in rental accommodation – might be to ask back: scrap legislation intended to limit rent price increases at a time when rents are shooting up? What are you, nuts? To which I would answer: rents have been shooting up ever since German cities were given the option of putting controls in place ten years ago. They've risen by almost 40 percent in my part of Hamburg, for instance, as this interactive infographic map illustrates , and Berlin is another story altogether … But surely, you might object, without the Mietpreisbremse , these rises would have been even worse? That can't be proved either way. After observing Germany's increasingly dysfunctional housing market for almost two decades now, however, I'd say: probably not. In fact, my creeping suspicion is that rent controls are ineffectual at best and, at worst, may actually be contributing to rises. Wait, so you think the Mietpreisbremse is making rents higher now…? No, please: hear me out! Ineffective on its own terms First off, experts agree that, even on its own terms, the Mietpreisbremse is ineffective – that's why those in favour of it usually also argue that it needs to be more stringent. In their current form, controls only apply to new rental contracts, and come with enough loopholes and exceptions that any landlord looking for one will find a semi-legal workaround. The easiest option is to either limit the length of the rental contract to less than one year or to part-furnish the letting – which has led to a market where unscrupulous operators are now demanding top-dollar for sticking a flat-pack wardrobe in the bedroom and then coming back for more a year later when the contract needs to be renewed. READ ALSO: Four scams to be aware of while navigating Germany's rental market Theoretically, this shouldn't be happening, of course. In Germany's tenant-friendly housing law, leases can only be time-limited if there is good reason – e.g. if the renter needs a short-term let for professional reasons – and any furnishings need to be high-value enough to warrant higher prices. Advertisement Yet for legal protections to apply, tenants have to know – and exercise – their rights. And as my colleague Paul Krantz has explained , even in simpler cases where the rent has been set too high on a standard lease, many who could challenge it do not – for lack of understanding, lack of time and energy, or lack of confidence confronting a potentially Scrooge-like landlord. A man hangs up his keys in a Berlin apartment. Photo: picture alliance/dpa/dpa-Zentralbild | Kira Hofmann Then there are the grey areas where well-meaning letters can easily end up unintentionally contravening the Mietpreisbremse . Under the rule, rents should not exceed a local average price by more than ten percent in tight housing market areas. But local rental averages are determined in rent price indexs – Mietenspiegel – which themselves are for more complicated than many assume: this is Germany, after all. In Hamburg, for example, figures are declined in a detailed table according to the specific location of buildings and when they were completed, leaving ranges of between €3 and €5 per square metre to take account of amenities such as balconies, bathtubs, and bicycle cellars… What is more, the Mietpreisbremse doesn't apply when significant works have been carried out prior to letting: but what does 'significant' actually mean? You might not be surprised to learn that, in cases which have gone to court, complicated formulae have been applied and a range of factors taken into account… The upshot is now that, to be sure of being able to make back money invested, law-abiding landlords are now likely to have more work done than might be strictly necessary (and then need to set rent even higher to recoup the extra costs…). Others, meanwhile, simply do the place up on the cheap and hope that tenants never challenge them to show their receipts. Setting the wrong incentives Why wouldn't they try? After all, once they are out of Mietpreisbremse territory, the sky is the limit – so the clear incentive for landlords is to look for any way to get an apartment out of regulatory purview and then set rent at market rates. Or, simply, to invest in new-builds, which are wholly exempt from rental controls – and rarely available for under €20 per square metre. Advertisement In this way, the Mietpreisbremse is entrenching a two-speed rental market where high-earning tenants with good credit records have their pick of snazzy new-builds and souped-up Altbau flats while those lower down the socio-economic scale are left fighting for increasingly pricey scraps. As I've written before, it's a trust issue : anyone with a flat to let is now acutely aware that its rental value is capped even as inflation, wages, and market values aren't. So increasingly, landlords max out the 10% the Mietpreisbremse allows – and then make use of all legal options to keep upping the rent. That is one reason so many new rentals are now using the unloved Staffelmiete (defined raises every year) and Indexmiete inflation-linked contracts, which allow for increases of 15 or 20 percent in a three-year period. Previously, it was standard practice – especially among ethically-minded private owners – to issue standard contracts and leave rents more or less untouched for sitting tenants before upping them on re-letting. Now, as rents continue to soar but the Mietpreisbremse limits raises, many private landlords are, perversely, having to hike rents in existing leases to avoid trouble with the Finanzamt further down the line: not charging market rates is, of course, considered a form of tax avoidance. These in-tenancy rises then drag up the averages on which the 10 percent maximum is calculated, and so the 'rent brake' is being applied at the same time as the price accelerator. Advertisement Overly-complex – and potentially unconstitutional This reveals the fundamental problem with rental controls. Like it or not, Germany's rental market is just that – a market. Yet by selling off swathes of social housing stock over recent decades, many major cities have deprived themselves of the best means of slowing price rises in this market -- offering affordable rental accommodation to those who need it. Instead, they now find themselves shelling out huge sums in housing benefit – Wohngeld – to low-income households and hoping that middle-income tenants have the gumption and courage to apply the complicated Mietpreisbremse themselves. All of this, meanwhile, puts the majority of well-meaning landlords at a disadvantage and encourages those with the ways and means to maximise revenue (or to simply ignore the system). No wonder rents are going up faster than ever. A view of flats in Hamburg. Photo: picture alliance/dpa | Daniel Bockwoldt So for me, it's simple: the Mietpreisbremse should be scrapped. Even in this market, asking rents currently can't go much higher – prospective tenants can no longer afford them on their wages – and there is every reason to suspect that the legislation may actually have pushed prices to this point faster than would otherwise have been the case. This, in turn, is contributing to stasis as people are forced to stay put and make do , with vacancies in most cities far below the 1 percent generally considered the minimum necessary for a functioning rental market. What is more, the Mietpreisbremse will eventually become unconstitutional: in our market economy, the state is not allowed to use price-fixing legislation to force a lasting devaluation of assets. Advertisement Thus far, Karlsruhe has accepted the rent controls because they are temporary, being implemented for defined periods of time. Yet when this planned extension reaches its term in 2029, the measures will have been in place for almost 15 years – making them 'temporary' in the same way that the exceptionally ugly shelving unit I 'temporarily' put in my hallway when we moved in 2010 is still 'temporary' one-and-a-half decades on. Mercifully, we haven't had our rent raised since then. Then again, we moved in before the Mietpreisbremse and paid top-whack in the first few years. That's how things used to work. Our newer neighbours, however, all seem to get regular rent increases. Call me crazy, but…
DW
18 hours ago
- DW
Trump and Musk trade barbs in public falling out – DW – 06/06/2025
Donald Trump and Elon Musk's disagreement over a budget bill has exploded into an open feud as Musk links US president to Epstein files. US President Donald Trump and his former adviser, Elon Musk are having a very public falling out. As Trump hosted German Chancellor Friedrich Merz in the White House, the US president expressed his "disappointment" with Musk over his public criticism of Trump's tax and spending bill that is up for approval by the Senate. Trump-Musk relationship unravels Trump said he didn't know if his "great relationship" with Musk would remain the same after the billionaire slammed the bill on social media as "a disgusting abomination." "Look, Elon and I had a great relationship. I don't know if we will anymore. I was surprised," Trump told reporters in the Oval Office. Trump claimed Musk's opposition to the bill was driven by its elimination of tax credits for electric vehicles, which would potentially hurt Tesla. The US president later posted on his media platform Truth Social that Musk "just went CRAZY" after "I took away his EV Mandate." Musk, however, says he opposes the bill because it would increase federal deficits, posting on X on Wednesday that "Congress was spending America into bankruptcy." It was part of a barrage of sniping posts that Musk launched on Wednesday evening. His posts then moved from politics to the personal, with Musk linking Trump and convicted sex offender Jeffrey Epstein. Musk claims Trump in Epstein files "Time to drop the really big bomb: @realDonaldTrump is in the Epstein files. That is the real reason they have not been made public. Have a nice day, DJT!" Musk posted late Wednesday evening. Musk provided no evidence for his claims. Trump's previous association with the wealthy financier Jeffrey Epstein, who hanged himself while awaiting trial, has been widely reported in the past. Trump has said the two had a falling-out 15 or so years ago and hasn't publicly objected to the release of the Epstein files. These are the documents linked to the sex-trafficking investigation into Epstein. The files are currently under review by the Justice Department. Trump threatens to cut Musk's government contracts Trump hasn't responded to Musk's posts about Epstein. But late on Wednesday evening, he threatened to cut Musk's government contracts in a Truth Social post. "The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon's Governmental Subsidies and Contracts. I was always surprised that Biden didn't do it!" Trump said. Elon Musk sported a black eye which he said came from his son as his time as special adviser to President Trump wrapped up Image: Nathan Howard/REUTERS Elon was "wearing thin," Trump posted. Musk spent at least $250 million (€218 million) backing Trump's bid to return to the White House and was tasked with heading up the cost-cutting Department of Government Efficiency (DOGE). Just under a week ago, Trump gave Musk a sendoff in the Oval Office in which Musk appeared with a visible black eye which he said came from his young son. This article was updated on June 6, 2025 to include more recent posts. Edited by: Wesley Rahn and Saim Dušan Inayatullah
