CBK.DE - Commerzbank AG

XETRA - XETRA Delayed price. Currency in EUR
5.47
+0.03 (+0.53%)
At close: 5:35PM CET
Stock chart is not supported by your current browser
Previous close5.44
Open5.61
Bid5.47 x 200000
Ask5.48 x 110000
Day's range5.46 - 5.65
52-week range4.66 - 8.26
Volume14,215,658
Avg. volume8,995,936
Market cap6.9B
Beta (5Y Monthly)1.89
PE ratio (TTM)8.59
EPS (TTM)N/A
Earnings dateN/A
Forward dividend & yield0.20 (3.67%)
Ex-dividend date2020-05-07
1y target estN/A
  • Oil Climbs to Level Last Seen After Saudi Attacks in September
    Bloomberg

    Oil Climbs to Level Last Seen After Saudi Attacks in September

    (Bloomberg) -- Oil settled above $60 a barrel for the first time since missile strikes on Saudi Arabia sparked a record price surge three months ago.Futures closed 1.5% higher in New York on Friday, buoyed by a partial truce in the U.S.-China trade war that has imperiled demand all year. Chinese officials said the countries agreed to hold off on a new round of tariffs set to go into effect in a matter of days. The bullish momentum was undermined when U.S. President Donald Trump tweeted that existing levies will remain in effect.“The market has just priced in this outcome to a certain extent already,” Daniel Ghali, a TD Securities commodity strategist, said by phone. “The hope is that a trade deal will translate into more demand.”Until Friday’s session, crude was poised to end the week little changed after surging more than 7% last week on the strength of a surprise OPEC supply cut. Money managers boosted bullish bets on crude by the most in more than three years in the days before the trade deal was struck.See also: Commodities Enjoy Best Week in 5 Months as Trade Deal Struck“Risk appetite among financial investors is now likely to remain high thanks to the deal between the U.S. and China,” said Eugen Weinberg, head of commodities research at Commerzbank AG in Frankfurt. Yet “the oil market risks facing a massive oversupply and a pronounced inventory build, at least in the first half of the year.”West Texas Intermediate for January delivery rose 89 cents to settle at $60.07 a barrel on the New York Mercantile Exchange. Brent for February settlement advanced $1.02 to $65.22 on the London-based ICE Futures Europe Exchange. The global benchmark settled at a $5.24 premium to WTI for the same month.(An earlier version corrected the day in second paragraph)\--With assistance from Catherine Ngai.To contact the reporter on this story: Robert Tuttle in Calgary at rtuttle@bloomberg.netTo contact the editors responsible for this story: David Marino at dmarino4@bloomberg.net, Joe CarrollFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Palladium Barrels Toward $2,000 as Red-Hot Rally Continues
    Bloomberg

    Palladium Barrels Toward $2,000 as Red-Hot Rally Continues

    (Bloomberg) -- Palladium set its sights on a record $2,000 an ounce, with the metal’s blistering rally showing no sign yet of cooling off.Prices climbed for an unprecedented 16th day after signs of a breakthrough in the U.S.-China trade talks, fueling hopes for a rebound in the auto industry, palladium’s biggest consumer. The metal that reached another record surged this week as mining disruptions in major producer South Africa threatened to tighten a market already hobbled by a persistent deficit.“We’re already in uncharted territory,” said Daniel Briesemann, a Commerzbank AG analyst. “The $2,000 mark seems to be a very attractive target to overcome. We also think some speculative financial investors may be pushing the price higher.”Spot palladium climbed as much as 2.1% to $1,982.01 an ounce, before trading at $1,969 at 10:25 a.m. in New York, according to Bloomberg generic pricing.The metal has gained more than 50% this year even as global car sales remain weak. Citigroup Inc. forecast prices could hit $2,500 next year.Tight supplies, which have trailed demand since at least 2012, mean that autocatalyst makers are scrambling to get hold of the metal to meet stricter pollution rules.“The physiological $2,000 level now acts as such a magnet to the market,” said Ole Hansen, head of commodity strategy at Saxo Bank A/S. “The strong momentum driven by tight fundamentals was given a further jolt on news that a phase-one trade deal has been reached.”South Africa, the world’s No. 2 palladium producer, expanded rolling blackouts to a record level earlier this week, disrupting miners’ operations. The situation has eased and most operations have returned to normal, although the country continues to experience power cuts.Still, given the relatively small size of the market, a pullback in palladium prices could be sharp, said ABN Amro Bank NV strategist Georgette Boele.“What goes exponentially up can eventually also drop like that,” she said. “It will not defy gravity forever.”Beijing and Washington have agreed on the text of a phase one trade deal, which will see the removal of tariffs on Chinese goods in stages, Vice Commerce Minister Wang Shouwen said. That averts the Dec. 15 introduction of a new wave of U.S. tariffs.Gold and silver swung between gains and losses, while platinum declined. The metal used in autocatalysts mainly for diesel-fueled vehicles will probably remain in surplus, Morgan Stanley said this week.The Bloomberg Dollar Spot Index reached the lowest since July.\--With assistance from Justina Vasquez.To contact the reporters on this story: Ranjeetha Pakiam in Singapore at rpakiam@bloomberg.net;Elena Mazneva in London at emazneva@bloomberg.netTo contact the editors responsible for this story: Phoebe Sedgman at psedgman2@bloomberg.net, ;Lynn Thomasson at lthomasson@bloomberg.net, Liezel HillFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • China Exports Unexpectedly Decline in November, Imports Rise
    Bloomberg

    China Exports Unexpectedly Decline in November, Imports Rise

    (Bloomberg) -- Terms of Trade is a daily newsletter that untangles a world embroiled in trade wars. Sign up here. China’s exports unexpectedly fell in November as global demand waned and a deal with the U.S. continued to elude negotiators, while imports rebounded.Exports dropped 1.1% in dollar terms in November from a year earlier, while imports rose 0.3%, the customs administration said Sunday. That left a trade surplus of $38.73 billion for the month. Economists had forecast that exports would rise 0.8% while imports would drop by 1.4%.Key InsightsThe numbers are a bit surprising as exports unexpectedly fell while imports returned to growth, said Zhou Hao, senior economist at Commerzbank AG in Singapore. Overall these are still soft numbers -- there might be some further import improvement in December due to a favorable comparison with low numbers last year, but in general there is hardly a meaningful improvement in sight.Imports from the U.S. rose for the first time since August last year, while exports continued their slide for a 12th month, dropping 23%. However, the value of imports in 2018 was depressed by the trade war so the increase this year is off a low base.Chinese and U.S. negotiators are moving closer to an agreement despite sharp rhetoric and diplomatic spats over Xinjiang and Hong Kong. U.S. negotiators expect a phase one deal to be completed before the Dec. 15 deadline when new American tariffs on Chinese goods are scheduled to take effect, according to people familiar with the matter.Senior Chinese officials will meet in coming days to set economic policy for next year, including the growth target and plans for monetary and fiscal settings.The soft rebound in imports shows the weakness of the domestic economy. The government has brought forward the sale of some debt so it can start spending the money as early as possible next year, but People’s Bank of China Governor Yi Gang indicated that the nation’s monetary policy will continue to refrain from large-scale easing steps.Get More“If a phase one trade deal is struck and there is no further escalation of U.S.-China trade tensions, the drag on China’s exports from higher U.S. tariffs will likely ease through 2020. Domestic business and consumer sentiment will also improve slightly, supporting investment and consumption, although trade-related uncertainty will likely remain elevated in the short term,” Sylvia Sheng, global multi-asset strategist at J.P. Morgan Asset Management in Hong Kong, wrote in a recent note.(Updates with deck headlines, economist’s comment, data on bilateral China-U.S. trade)\--With assistance from Tomoko Sato.To contact Bloomberg News staff for this story: Miao Han in Beijing at mhan22@bloomberg.netTo contact the editors responsible for this story: Jeffrey Black at jblack25@bloomberg.net, James Mayger, Keith GosmanFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Bloomberg

    UniCredit Bides Its Time With an $8.9 Billion Gift

    (Bloomberg Opinion) -- Jean Pierre Mustier’s new four-year plan for Italy’s UniCredit SpA marks a victorious milestone for the chief executive officer. He’s managed to turn a sprawling European bank laden with bad loans into a simpler entity that promises to improve its returns to shareholders. It leaves him well-placed to plot his biggest move yet (should he so choose): cross-border M&A.The Italian bank has cut costs, sold non-core units and eliminated a bad-debt mountain. While he’s forfeited growth by exiting businesses in Poland and Italian online lending, Mustier has improved profitability. The group return on tangible equity is targeted to exceed 9% this year, up from just 4% in 2015.He’s convinced regulators that the bank doesn’t need as much capital and he’ll seek their approval for the company’s first share buyback since 2004. The 27.8 billion-euro ($31 billion) lender plans to return 8 billion euros ($8.9 billion) to investors in dividends and stock purchases through 2023, giving an implied yield of as much as 7%. That compares with a 6% average for the sector, according to UBS Group AG analysts.All this good work is just as well. While the Frenchman has made UniCredit a more stable, cross-border commercial lender, it still faces huge challenges. That was plain to see in some of the key targets in his “Team 23” strategic plan unveiled on Tuesday.Under assumptions for interest rates that UniCredit says are more severe than the market’s, it sees ROTE declining again. Under this scenario, the measure will be no higher than 8% through 2022, while the bank’s revenue will increase by a meager 0.8% on average annually during the four-year plan. That’s below analyst estimates. Mustier won’t be able to do much more on costs, either; they’ll remain little changed throughout the plan’s duration.Crucially, eking out that modest growth in revenue will depend on UniCredit expanding loans to Europe’s small and medium-sized businesses and consumers at a pace that exceeds GDP expansion.There are some more levers Mustier can pull. UniCredit plans to set up an Italian holding company for foreign assets that could lower its capital needs. It still owns 32% of the Turkish bank Yapi ve Kredi Bankasi, a stake that could be sold.But Mustier’s vision for a “pan-European winner” (his words) may require more radical thought. For the moment, he’s adamant there will be “no M&A,” pointing to smaller, bolt-on purchases. Valuations are a stumbling block to large deals. With UniCredit’s shares trading well below its book value, it makes more sense to pursue buybacks — as Mustier says.Nonetheless, the bank’s smaller, nimbler form positions it for a cross-border deal should the European Union ever complete its banking union. Germany’s Commerzbank AG is often mooted as a partner. If UniCredit’s share price ticks up in the meantime, that would certainly help.To contact the author of this story: Elisa Martinuzzi at emartinuzzi@bloomberg.netTo contact the editor responsible for this story: James Boxell at jboxell@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Elisa Martinuzzi is a Bloomberg Opinion columnist covering finance. She is a former managing editor for European finance at Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.

  • Commerzbank managers keeping staff in dark on overhaul, union says
    Reuters

    Commerzbank managers keeping staff in dark on overhaul, union says

    Commerzbank managers are keeping employees in the dark about the German lender's overhaul plans, a union representative said on Wednesday. The state-backed bank earlier this year announced plans to restructure after a failed merger attempt with Deutsche Bank .

  • Oil Rises on Signs of Trade-Talks Optimism, Key Hub Drop
    Bloomberg

    Oil Rises on Signs of Trade-Talks Optimism, Key Hub Drop

    (Bloomberg) -- Oil rose on signs of progress in trade talks between the U.S. and China.Futures were little changed in New York after settling 0.7% higher Tuesday. Washington and Beijing “reached consensus on properly resolving relevant issues” to pursue a “phase one” trade deal during a phone call on Tuesday, China’s Ministry of Commerce said. The American Petroleum Institute reported that U.S. stockpiles at a key hub fell 516,000 barrels last week, according to people familiar.“The general sense is that the economy is doing good,” said Phil Flynn, senior market analyst at Price Futures Group in Chicago. “There is a little bit of movement toward the U.S.-China trade deal, but the market is reflecting the strength we see in stocks and overall optimism.”Crude has been rising since early October on the thaw in trade hostilities between the world’s two largest economies, although investors are becoming increasingly fatigued over how long the negotiations are taking. Traders are also concerned that OPEC and its allies seem unwilling to cut production further when they meet next week, despite signs of a renewed surplus in early 2020.“The optimism that the trade conflict will at least ease somewhat is currently preventing prices from falling,” said Carsten Fritsch, an analyst with Commerzbank AG in Frankfurt.West Texas Intermediate for January delivery traded at $58.28 at 4:42pm after rising 40 cents to settle at $58.41 a barrel on the New York Mercantile Exchange.Brent for January settlement climbed 62 cents to end the session at $64.27 a barrel on the London-based ICE Futures Europe Exchange. The global benchmark traded at a $5.86 premium to WTI.The industry-funded API also reported that US. crude supplies rose by 3.64 million barrels. Meanwhile gasoline inventories grew 4.38 million barrels and distillate inventories fell by 665,000 barrels.Analysts surveyed by Bloomberg said nationwide inventories probably fell by 878,000 barrels. That would still be near the highest level since July as the country’s oil output keeps rising.“Optimism linked to the U.S. Chinese trade discussions, the likely extension of OPEC+ agreement and increased utilization rates should provide support to crude structure,” said Tom Finlon, director of Energy Analytics Group Ltd in Wellington, Florida.To contact the reporter on this story: Jacquelyn Melinek in New York at jmelinek@bloomberg.netTo contact the editors responsible for this story: David Marino at dmarino4@bloomberg.net, Mike Jeffers, Catherine TraywickFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Oil Surges as Key U.S. Storage Hub Shows Biggest Draw in Months
    Bloomberg

    Oil Surges as Key U.S. Storage Hub Shows Biggest Draw in Months

    (Bloomberg) -- Oil jumps the most since the first of the month as American crude stockpiles at a key storage hub shrank by the most since August.Futures rose 3.4% in New York, the biggest gain since Nov. 1. The Energy Information Administration reported that crude supplies at Cushing, Oklahoma, declined by 2.3 million barrels, the biggest draw in three months. Nationwide crude inventories rose 1.38 million barrels, less than reported by the American Petroleum Institute on Tuesday.There is some unrest in the market that could be supporting prices, said Ashley Petersen, oil market analyst at Stratas Advisors LLC. “But that doesn’t change the fundamental picture that was bringing down prices over the past two weeks, concerns about future demand and supply,” she said. “So that makes the question: ‘How long can this rally last?’”Although nationwide crude stockpiles rose, the size of the build was smaller than the volume of crude released from the Strategic Petroleum Reserve. Combined crude and products inventories fell by 6.93 million barrels.“The Cushing draw is pushing WTI prices higher for sure,” said Matt Sallee, portfolio manager at Tortoise, a Kansas firm that oversees more than $21 billion in assets. “We’ve seen some interruption from the Canadian supply, but it’s hard to say in any given week, but I think that’s what’s supporting WTI prices.”West Texas Intermediate for December delivery, which expires Wednesday, rose $1.90 to settle at $57.11 a barrel on the New York Mercantile Exchange. The more-active January contract increased $1.66 to end the session at $57.01.Brent for January settlement gained $1.49 to close at $62.40 a barrel on the London-based ICE Futures Europe Exchange. The global benchmark crude traded at a $5.39 premium to WTI for the same month.The EIA report also showed gasoline inventories rose 1.76 million barrels while distillate supplies fell 974,000 barrels. Crude production remained strong at a record level of 12.8 million barrels a day for the second week in a row.To contact the reporter on this story: Jacquelyn Melinek in New York at jmelinek@bloomberg.netTo contact the editors responsible for this story: David Marino at dmarino4@bloomberg.net, Catherine Traywick, Mike JeffersFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Reuters - UK Focus

    LIVE MARKETS-Are European banks getting naughtier?

    * Qiagen surges as it explores sale Welcome to the home for real-time coverage of European equity markets brought to you by Reuters stocks reporters and anchored today by Julien Ponthus. ARE EUROPEAN BANKS GETTING NAUGHTIER? "While U.S. banks were particularly hit by misconduct costs in the immediate aftermath of the global financial crisis, European banks have been more exposed since 2015", a study published today by the ECB found.

  • Negative rates are hurting savers and the banks that handle their money
    Yahoo Finance

    Negative rates are hurting savers and the banks that handle their money

    Lessons from Germany as interest rates remain below 0%.

  • Commerzbank warns of profit drop for 2019
    Reuters

    Commerzbank warns of profit drop for 2019

    Commerzbank AG on Thursday said its 2019 profit would be lower than last year, partly due to the impact of euro zone monetary policy that has pressured margins. The state-backed bank, which is restructuring after a failed merger attempt with Deutsche Bank , also cited trade conflicts and expectations for a higher tax rate in the fourth quarter for the profit downgrade. "We deliberately set long-term success above short-term return targets," Chief Executive Officer Martin Zielke said.

  • Analyst Tears Up New Apple AirPods to Prove Their Power Source
    Bloomberg

    Analyst Tears Up New Apple AirPods to Prove Their Power Source

    (Bloomberg) -- A Commerzbank AG analyst has gone to great lengths to prove that Apple Inc.’s latest AirPods Pro earbuds are powered by batteries made by German manufacturer Varta AG.Stephan Klepp visited his local Apple store and bought a pair of the $249 earphones, before dismantling them to find a Varta lithium-ion micro-battery inside, he wrote in a note.“Overall, our tear-down puts the speculation around Apple ultimately to rest,” Klepp said in his report, which included pictures of the dissected device and its power source.Varta and Apple declined to comment.Varta shares have risen to the highest since being re-listed in 2017 on speculation that Apple, the market leader for wireless earbud headphones, may be behind numerous capacity increases announced by the German manufacturer. To date, neither company has confirmed the relationship.Klepp has a buy recommendation on Varta, whose shares rose 1.8% in late Frankfurt trading, extending gains after soaring more than 7% in each of the previous two sessions.To contact the reporter on this story: Richard Weiss in Frankfurt at rweiss5@bloomberg.netTo contact the editors responsible for this story: Daniel Schaefer at dschaefer36@bloomberg.net, Paul JarvisFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Bloomberg

    Germany's Peace Offering to the European Central Bank

    (Bloomberg Opinion) -- Some good news for the European Central Bank. The German government has nominated Isabel Schnabel, an accomplished economist at the University of Bonn, to replace her compatriot Sabine Lautenschlaeger on the ECB’s executive board. Lautenschlaeger is quitting after the central bank’s decision to restart large-scale bond purchases (known as quantitative easing).It’s an anachronism that Germany, France and Italy always get to choose one of the top positions at the ECB. But if this appointment must be made by Berlin, Schnabel is a fine choice.Read More: ECB Gets Chance for German Reset With Lagarde-Schnabel Dual ActThe ECB’s senior team has three big problems: its increasingly bitter divisions over QE, a shortage of trained economists in the top jobs and a lack of female leaders. Hiring Schnabel would address each of these issues. Her pragmatism and ability to see both sides of the monetary argument would ease some of the tension that’s taken hold after several members of the ECB’s governing council — which includes the central bank chiefs of all euro zone members — voted against the decision by departing president Mario Draghi to restart asset purchases.The relationship between the ECB and Germany is especially fraught. Jens Weidmann, president of the Bundesbank, has opposed many of Draghi’s boldest policy moves, including his 2012 pledge to do “whatever it takes” to preserve the euro. Immediately after last month’s announcement on new bond-buying, Weidmann distanced himself from the decision. Lautenschlaeger resigned weeks afterwards, having also voiced her dissent.Schnabel is a hawk too, with her own doubts about the need for more QE. She’s an advocate of stringent bank supervision, supporting the “bail-in” mechanism that forces losses on bondholders when lenders fail. She opposed the proposed merger of Germany’s Deutsche Bank AG and Commerzbank AG because the resulting bank would have been too big to fail. Yet she has defended the ECB in Germany. In September Schnabel tweeted that her country “shouldn’t use the ECB as a scapegoat,” comparing it to how the U.K. berated the EU before the Brexit referendum.She also believes Draghi’s “whatever it takes” policy, which promises to support any euro area country in trouble, is crucial. One can expect her to fight for tighter monetary policy, but in a consensus-building manner. She could be a powerful ally to Christine Lagarde, who replaces Draghi at the end of October, especially if she managed to convince a skeptical German public that the ECB was following the right course. Schnabel’s recruitment would also help restore the depleted ranks of trained economists among the ECB leadership. Lagarde has had a distinguished career as France’s finance minister and the International Monetary Fund’s managing director, but she’s not an economist. Luis de Guindos, her deputy, has spent much of his recent professional life as a banker and politician.The ECB will have lost three first-rate economic thinkers by the end of this year, including Benoit Coeure (a member of the executive board), Peter Praet (the central bank’s former chief economist) and Draghi himself. The appointment of two seasoned economists, Philip Lane to replace Praet and Italy’s Fabio Panetta to the executive board, isn’t enough.Finally, the ECB needs more women in senior posts. The European Parliament has often scolded the Frankfurt institution for its lack of gender balance. Unless Lautenschlaeger’s replacement is a woman too, Lagarde will be the lone female in the top ranks. Other recent appointments to the executive board were made without putting any women on the candidate lists.Schnabel is eminently well-qualified. She has written extensively on banks and the financial system, has been a member of the German Council of Economic Experts and has advised the Bundesbank and Germany’s bank regulator BaFin. In 2018 she was part of a group of German and French economists that put together a thoughtful proposal to reform the euro zone. It’s a reassuring sign that Berlin has put forward her name. This might be an attempt to de-escalate the conflict with the central bank at a time of transition and vulnerability in Europe. It may even let Germany increase its influence. Joerg Asmussen, Lautenschlaeger’s predecessor on the ECB board, supported many Draghi policies and played a key role until his resignation in 2013. Schnabel would hope to do similar. To contact the author of this story: Ferdinando Giugliano at fgiugliano@bloomberg.netTo contact the editor responsible for this story: James Boxell at jboxell@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Ferdinando Giugliano writes columns on European economics for Bloomberg Opinion. He is also an economics columnist for La Repubblica and was a member of the editorial board of the Financial Times.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.

  • Commerzbank sounds out potential mBank buyers as lenders hire advisors - sources
    Reuters

    Commerzbank sounds out potential mBank buyers as lenders hire advisors - sources

    WARSAW/FRANKFURT (Germany) (Reuters) - Commerzbank is sounding out potential buyers of its stake in Polish lender mBank ahead of a formal sale process which is expected to launch in coming months, people familiar with the matter said. MBank has hired JPMorgan as an advisor, while Goldman Sachs is advising Commerzbank, two sources said. Germany's second-largest lender, which is seeking funds to finance its recently announced restructuring, said in September its supervisory board had approved plans to sell the 69.3% stake in mBank, worth about $2.65 billion.

  • Bloomberg

    Deutsche Bank Is Only Part of Germany's Misery

    (Bloomberg Opinion) -- Attempts to accelerate the shakeup of German banking haven’t had much success in the past year. First, talks to combine two state-owned regional lenders fell apart; then Deutsche Bank AG and Commerzbank AG tried but (for good reason) were unable to find a way to make a merger work. Now a third combination is on the table.This time too, any real excitement about needed consolidation in a deeply fragmented market is premature. Putting together a regional, public-sector bank, Helaba, with an asset management business, DekaBank, is but a baby step toward the industry’s restructuring. Plus political goodwill appears to be lacking still for the transformational, and expensive, adjustments needed to revive the companies’ profitability.State-backed lenders control about 25% of the nation’s banking assets and cooperative banks another 10%, creating fierce, low-margin competitors to the third pillar of German banking: private commercial lenders such as Deutsche Bank and Commerzbank. Earning a decent return has become difficult for everybody.A year ago, Germany’s state-backed lenders considered an ambitious plan to reorganize one part of the country’s public-sector finance sector: the Landesbanken, whose business models were shown to be deeply flawed by the financial crisis. Landesbanken invest money for local savings banks (or Sparkassen) and have ventured out internationally and taken on more risk. Weakened by losses on everything from toxic asset-backed securities to shipping loans, they’ve received several bailouts since the crisis.Indeed it was a capital shortfall at one Landesbank, NordLB, that encouraged discussions last year to combine it with another, Helaba. Coming just after the first Landesbank privatization, of HSH Nordbank, the deal would have marked an important step in rationalizing these institutions. Ultimately, having one Landesbank catering to the nation’s 380 or so savings banks — rather than half a dozen — is probably sufficient.Yet the NordLB plan needed the backing of the two federal states that control the lender, and local governments haven’t exactly been jumping at the chance to loosen their grip. Private buyers also walked away from a bid for NorldLB.It’s no suprise then that the latest attempt at a big German merger goes in a different direction. Helaba is largely controlled by the savings banks rather than directly by local government and Deka is the asset management unit of the savings banks, making a combination easier to achieve (or at least that’s the hope). Having a new, bigger entity with about 260 billion ($286 billion) euros of assets might even attract other Landesbanken to join the club.Still, this all still leaves the future of the ailing NordLB in the hands of the states of Lower Saxony and Saxony-Anhalt. Worse, the states are about to give it more cash in a rescue that could further distort competition, a violation of European Union state aid rules.As things stand, the states will inject 1.7 billion euros into NordLB, with another 1.14 billion euros coming from the German Savings Bank Association (DSGV) and publicly owned savings banks. To stop it breaching state aid rules, the recapitalization must pass a so-called private investor test: The overhauled business needs to look like something a normal investor would back.In fairness, the plan is ambitious. NordLB anticipates shrinking its balance sheet from about 150 billion euros to 95 billion euros, refocusing on its regional business and ultimately cutting its cost to income ratio below 50% by 2024. By European standards that would be an extremely efficient bank. The EU average cost-income ratio is closer to 70%.The European Commission is still reviewing whether the plan adds up to state aid. It’s a tricky question; Brussels not letting the state entities salvage their own investment might be seen as discriminatory.But if the greater good of German lending is the motivation, namely pruning an over-banked sector, you have to ask whether it makes sense to keep NordLB afloat at all costs. Berlin has taken a dim view when Italy has done similar with its lenders. A Helaba merger with Deka would be little consolation.To contact the author of this story: Elisa Martinuzzi at emartinuzzi@bloomberg.netTo contact the editor responsible for this story: James Boxell at jboxell@bloomberg.netThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Elisa Martinuzzi is a Bloomberg Opinion columnist covering finance. She is a former managing editor for European finance at Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.

  • Osram Takeover Battle Set for Next Round After AMS Bid Setback
    Bloomberg

    Osram Takeover Battle Set for Next Round After AMS Bid Setback

    (Bloomberg) -- The battle for control of Osram Licht AG is set to enter a new round after Austria’s AMS AG vowed to keep fighting after a sweetened 4 billion euro ($4.4 billion) offer failed.AMS, a supplier to Apple Inc., will seek a regulator nod to raise its 19.99% stake in Osram. As the biggest shareholder in the German lighting maker, AMS’s approval has become key for any would-be rival bidder. Osram has said private equity investors Bain Capital and Advent International are inspecting its books with a plan to make an offer.“We doubt private equity will launch a superior bid given AMS has built up a 19.99% stake in the meantime,” Commerzbank said in a note. “While we cannot rule out that AMS might make another push, timing is yet unclear, so we attach a greater likelihood to a potential cooperation only.”German takeover law doesn’t allow a new bid within one year unless the target gives its consent, as well as stipulating that an offer needs to be made if an investor crosses a 30% ownership threshold. AMS’s pursuit took a setback Friday, when it announced its offer failed to attract enough support from shareholders. Osram investors had tendered only 51.6% of their shares, short of a 62.5% threshold.Osram fell as much as 4.5% to 39 euros, the most in two months, while shares of AMS declined as much as 5.8%.AMS’s failed bid extends a period of protracted uncertainty for Osram, which emerged as a takeover target last year after warning trade friction and a cooling of the car industry had clouded the outlook for 2019. The former division of Siemens AG gets about half of its revenue from the automotive sector. Subsequent profit warnings further eroded investor confidence, sending shares tumbling until the takeover battle took hold.Osram confirmed talks with Bain and Carlyle, which was later replaced by Advent, in February after they were first reported by Bloomberg News. A bidding war broke out in July when AMS lobbed a higher offer. The Austrian company has drawn criticism from Osram unions and employee representatives on the board, as well as management due to concerns about promised synergies as well as the deal’s financing.Following the months-long takeover battle against private equity suitors, AMS said the combination remains compelling and pledged to continue to “explore strategic options” for a takeover. Bain and Advent are inspecting Osram’s books “with a view to submitting an offer,” Osram said in a separate statement.AMS, a supplier of facial recognition technology for Apple’s iPhone, has said it would invest in the company’s Regensburg, Germany site that makes high-tech chip components, but would sell the digital division that makes lighting controls, stage and theater lights.Century-old Osram, based in Munich, started out making light bulbs, pivoting in recent years under Chief Executive Officer Olaf Berlien to products like iris scanners and infrared emitters. The refocus was contentious, leading to a boardroom clash over strategy and a public spat with Siemens before the German engineering giant sold down its stake.To contact the reporter on this story: Oliver Sachgau in Munich at osachgau@bloomberg.netTo contact the editors responsible for this story: Tara Patel at tpatel2@bloomberg.net, Elisabeth Behrmann, Jennifer RyanFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

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