Strong Q3 23 figures, 2023 profit target upgrade and share buy-back

• Total revenues increased by 46% to €2.75bn in Q3 23 compared to Q3 22 • Further provisions relating to Swiss franc loans of mBank of €234m in Q3 23 • Consolidated profit was up from to €195m for Q3 22 to €684m for Q3 23 • Commerzbank upgraded its profit target for the FY2023 from well above 2022 (€1.4bn) to €2.2bn (+57%) • Commerzbank announced a share buy-back of €600m

Good Q2 figures despite additional burdens from Polish CHF loans

• Revenues increased by 9% to €2.6bn driven by higher net interest income • Further provisions relating to the Swiss franc loans of mBank amounted to €347m in Q2 23 • Administrative expenses including compulsory contributions declined by 2% to €1.5bn • Consolidated profit was up by 20% to €565m for Q2 23 • Commerzbank confirmed its 2023 net result target well above FY2022 and indicated that it had asked the regulators for a share buy-back approval

Revenue decrease in Q1 but a strong profit increase thanks to lower risk costs

• Total revenues decreased by 4.5% to €2.7bn in Q1 23 compared to Q1 22 • The risk result (loan losses) improved from €464m for Q1 22 to €68m for Q1 23 • Consolidated profit was up by 95% to €580m for Q1 23 • Commerzbank confirmed all of its 2023 financial targets

Good 2022 figures pushed by rate hikes despite the burden of Polish mBank

• Total revenues were up by 12% to €9.5bn for 2022 compared to 2021 • Poland contributed negative revenue of €278m plus a further €650m of provisions for the Swiss franc loans of mBank • Net profit attributable to share increased from €291m for FY2021 to €1.24bn for FY2022 • Commerzbank is targeting a net result in 2023 well above the 2022 level. In addition, the Bank intends to increase the pay-out ratio to 50%

Good Q3 22 figures despite €500m loss of Polish mBank

• Revenues decreased by 6% to €1.9bn in Q3 22 due to one-off charges of €270m for so-called “credit holidays” at mBank • Further provisions relating to Swiss franc loans of mBank amounted to €477m in Q3 22 • The pre-tax result declined by 33% to €267m for Q3 22 due to a pre-tax loss of €528m for mBank in Q3 22 • Commerzbank confirmed its net result target of more than €1bn for the FY2022

Good Q2 figures owing to higher interest income and lower restructuring costs

• Revenues increased by 30% to €2.4bn driven by higher net interest income • Restructuring charges were €25m in Q2 22 compared €511m in Q2 21 • The net result was a profit of €470m for Q2 22 compared to a loss of €527m for Q2 21 • Commerzbank confirmed its net result target of more than €1bn for the FY2022 despite no contribution from Polish mBank • Risk costs of 20bp forecasted in a “no gas from Russia” scenario

Good Q1 figures

• Revenues increased by 12% to €2.8bn for Q1 22, driven by higher net interest income • The risk result rose to €464m for Q1 22 compared to €149m for Q1 21, owing to charges due to the war in Ukraine • The net result was €298m for Q1 22 compared to €133m for Q1 21 • Commerzbank confirmed all its 2022 financial targets

Surprisingly good preliminary Q1 figures

• Revenues increased by 12% to €2.8bn for Q1 22, driven by higher net interest income • The risk result rose to €464m for Q1 22 compared to €149m for Q1 21, owing to charges due to the war in Ukraine • The preliminary net result was €284m for Q1 22 compared €133m in Q1 21 • Commerzbank confirmed all its 2022 financial targets

Return to profit but still in restructuring mode

• Net profit increased from a loss of €2.9bn for FY2020 to a profit of €430m for FY2021 which was higher than consensus expectations of €95m. • Risk result declined from €1.75bn for 2020 to €570m for 2021. • Restructuring expenses were €1.08bn in 2021 compared to €814m in 2020. • Commerzbank expects a net profit of more than €1bn, and aims to pay a 30% dividend for FY2022, thereafter 30-50% plus potential share buy-backs.

Solid Q3 figures, profit pushed by lower loan provisions and tax income

• Total revenues decreased by 1% to €2.0bn in Q3 21 compared to Q3 20 • Net profit increased from a loss of €60m for Q3 20 to a profit of €403m for Q3 21 • Risk result (loan losses) declined €272m for Q3 20 to €22m for Q3 21 • Commerzbank expects now a net profit for FY2021

High net loss in Q2 21 from restructuring charges as expected

• Net loss was €527m for Q2 21 compared to a net profit of €183m for Q2 20 • Swing from a profit of €42m for “other income” in Q2 20 to a loss of €288m in Q2 21 • Risk result (loan losses) declined from €469m for Q2 20 to €87m for Q2 21 • Restructuring charges of €511m in Q2 21

Surprisingly good Q1 figures, net profit despite high restructuring charges

• Net profit of €133m for Q1 21 compared to a net loss of €291m for Q1 20 • Swing from a loss of €304m for the fair value result in Q1 20 to a profit of €360m in Q1 21 • Risk result (loan losses) declined from €326m for Q1 20 to €149m for Q1 21 but increase expected from H2 21 onwards • Restructuring charges of €465m in Q1 21 and another €680m in Q2-Q4 21

Huge loss for 2020 as expected

• Net profit after minorities attributable to shareholders decreased from €644m for 2019 to a loss of €2.9bn for 2020. • The resumption of dividend payments is planned for FY2023. • Up to €3bn of payouts to shareholders in the years 2023 and 2024.

New restructuring programme draft with harsh staff cuts

Commerzbank will reduce c.10,000 full-time equivalents in gross terms. Costs will be reduced by €1.4bn, or around 20%, by 2024. Restructuring expenses totalling €1.8bn, which will be fully financed with existing funds. Commerzbank targets a Return on Tangible Equity (RoTE) of 6.5-7% for FY2024.

New CEO starts with a profit warning

Commerzbank expects to impair fully the existing goodwill of around €1.5bn in FY2020. The loan loss provision guidance of €1.3-1.5bn for FY2020 was increased to at least €1.7bn too. The bank is planning further restructuring measures as part of a new strategy to be announced in the first quarter of 2021.

Morning Note – 22 April 2024

Benefits of scale set to materialise

Frenkel Topping - Resilient with strong growth potential

FY 2023 was a challenging year for Frenkel with higher interest rates encouraging clients to place money into lower margin money market funds. Despite this, sales grew +32% (supported by recurring revenue +9% and +51% in non-recurring), EBIT margins remained strong at 22% and adj. EPS grew +17% (taking into account the higher number of shares). FY 2024 has seen a solid start to transactional business and there is a strong pipeline of new FUM opportunities both of which support further growth. Wi

S&U - PBT ahead, encouraging volume trends

S&U reported FY24 PBT of £33.6m, down from £41.4m in FY23 on higher funding and regulatory costs and higher impairments in Advantage in H2. PBT was 2% ahead of our forecast as stronger revenues – up 12% to £115.4m – and better costs offset higher-than-expected impairments. Net receivables grew to a record at both Advantage and Aspen and management noted particular strength in Q4 and a good trading environment in the current year. Having absorbed a significant rise in funding cost as well as addi

Hardman & Co Insight: 2023 was an annus horribilis for Quoted UK Infrastructure and Renewable Energy

The focus of Hardman & Co Research is on the nine quoted Infrastructure Investment Companies (IICs) and on the 22 Renewable Energy Infrastructure Funds (REIFs): the stocks analysed are all members of the Association of Investment Companies (AIC). We are updating our publication of January 2023, assessing both the lacklustre share price performances during 2023 and the key issues, including interest rates, inflation and power prices. As a 31-strong group, its combined market capitalisation is no

Foresight Solar Fund - Termination of coverage

Edison Investment Research is terminating coverage on ABC Arbitrage (ABCA), paragon (PGN), Foresight Solar Fund (FSFL), Kendrion (KENDR), Lithium Power International (LPI), Triple Point Energy Transition (TENT), 4iG (4IG), e-therapeutics (ETX), Pharnext (ALPHA) and Shield Therapeutics (STX). Please note you should no longer rely on any previous research or estimates for this company. All forecasts should now be considered redundant. Previously published reports can still be accessed via our web

LIBERUM: PayPoint: On track for £100m of EBITDA in FY 26

Hybridan Small Cap Feast - 22 April 2024

22nd April 2024 * A corporate client of Hybridan LLP ** Arranged by type of listing and date of announcement *** Alphabetically arranged **** Potential means Intention to Float (ITF) has been announced Dish of the day Admissions: Delistings: What’s baking in the oven? ** Potential**** Initial Public Offerings: Reverse Takeovers: 16 April 2024: Electric Guitar (ELEG.L) Concurrent with its Admission to trading on AIM, Electric Guitar is proposing to acquire the entire issued share capital of 3radi

LIBERUM: Speedy Hire: Weakness in FY 24 but recovery in FY 25

Regional REIT - Performing as expected ahead of refinancing

In a challenging market, Regional REIT’s (RGL’s) FY23 operational and financial performance was robust, in line with expectations and previous guidance. Investor focus remains on the company’s loan to value (LTV) reduction and bond refinancing plans, explored in detail in our previous note and RGL will provide an update on this in due course.

The Hardman & Co Monthly: April 2024

Feature article: Steady as she goes, but could be better: A review of investment company liquidity since 2016 Liquidity is the lifeblood of equity markets. The measurement of liquid asset availability to a market or company is a way of gauging a market’s health. This article builds on our previous work, which analysed the liquidity data for non-financial trading companies, by applying the same analytical techniques to the investment companies (IC) space. We analyse liquidity for ICs as a whol

Foxtons Group (FOXT LN) - 1Q24 IMS shows real momentum

Foxtons Group plc first quarter revenue rose 9% to £35.7m (1Q23: £32.9m) with growth delivered across all business segments. Trading is in line with management's expectations.

Morning Note – 29 February 2024

Jupiter Green

Hardman & Co Insight - Asset managers had a poor 2022

Asset managers had a poor 2022: the S&P Composite 1500 Asset Management Index was down 22% and, according to the Investment Company Institute (ICI), worldwide mutual funds fell by 20%, from $76tr to $60tr. When bond and equity markets fall, the results are unlikely to be pretty: with revenues trending down and multiples contracting, there is a double whammy to contend with. So how do valuations shape up now, after a bullish start to the new year? The first chart is my favourite chart of asset m