Commerzbank reports profit surge as it fends off UniCredit bid
Germany's Commerzbank posted better-than-expected results for the first three months of 2025. Instead of the anticipated declining net income, the bank's net result increased by 12% to €834 million.
The lender's revenues increased by 12% to €3.1 billion, while net interest income was slightly less than a year ago, standing at €2.07bn at the end of the first quarter of 2025. Meanwhile, the net commission income, driven by a strong securities business, grew by 6% to €1bn in the same period.
'We achieved the highest quarterly profit since 2011, demonstrating that we can grow even in economically challenging times,' Commerzbank CEO Bettina Orlopp said. 'We are progressing with the implementation of our strategy 'Momentum'. We plan to return more capital to our shareholders in the coming years.'
Commerzbank completed a share buyback programme of €1bn starting from November 2024, and it also proposes to pay a dividend of €0.65 per share, which will be decided at the Annual General Meeting on 15 May 2025.
The better-than-expected results are coming at a time when the German bank is making efforts to fend off Italian banking group Unicredit's takeover advances.
Related
Commerzbank to cut jobs and boost profits in bid to fend off UniCredit
Italy's UniCredit beats profit estimate as it continues takeover drive
Unicredit has recently acquired a large stake in Commerzbank, raising its stake to 29.9%, just short of the 30% threshold at which Unicredit is required to make a public offer for the entire bank.
In February, Commerzbank announced cost-cutting measures, including job cuts of about 10% of the bank's workforce, to fend off any takeover bid by the Italian bank.
The German lender's employee representatives are also organising a protest against a possible takeover, scheduled just hours before Commerzbank's annual general meeting on 15 May.
The German bank said that this year it expects a higher net result of around €2.4bn for the full year, after restructuring expenses.
The bank set aside €40m for restructuring expenses in the first quarter, for an early partial retirement programme, which the bank will offer later this year. It is part of the job reductions, the lender is currently negotiating with the employee representative committees.
Furthermore, to preserve profitability, Commerzbank reduces its dependence on net interest income –the difference between what it earns from loans and pays for deposits–as interest rates fall.
The return on tangible equity improved to 11.1% from last year's 10.5% in the first quarter, which is seasonally strong. 'We are on track to reach our full-year target of around 9.6%,' Commerzbank CFO Carsten Schmitt said. 'At the same time, we are reducing our dependency on net interest income. We confirm our outlook for 2025.'
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