Stable underlying performance in the operating divisions Commerzbank''s retail and corporate banking activities are maintaining pre-provision profits at a stable run-rate, similar in 2Q21 to 2Q20 and 2Q19. That is good in a sense, to hold steady despite the costs and disruptions of the change programme (and low rates). But it is also inconclusive, in that we are not yet seeing clear evidence of progress towards better levels of profitability. Multiple and material one-off items causing group losses Alongside this the bank is incurring a lot of large non-operating charges, including restructuring (as planned), but also the Polish CHF mortgages, the German fee consent ruling, the cancellation of the securities outsourcing project (rather more unexpected), and a number of fair value revenue items. These push the group into loss, and cause some anxiety about the risk of more to come. Credit quality remains benign, but uncertain After low 1H loan loss provisions (EUR 236m or 18bp of loans annualised), the FY guidance is improved from ''=1bn'' to ''1bn'', with an implication that it could be well below 1bn (as the 1H run-rate suggests). But management emphasise how uncertain the outlook remains, with all the variables that we are familiar with. Restructuring work is progressing, but perhaps too early to assess The bank is pressing ahead with its extensive transformation programme, and indicates good progress on digital service enhancements, branch and headcount reductions, near-shoring, and action on less profitable corporate relationships. Customer attrition is said to be less than expected too. But we are only a few months on from the mid-February plan, so it remains early days. We update estimates and target price, remain Neutral In line with the somewhat inconclusive nature of the latest datapoints, we make relatively limited changes to our forecasts and fair value. We keep our Neutral rating on the shares.