Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on COMMERZBANK AG. We currently have 8 research reports from 1 professional analysts.
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Ridiculously low return after 8 years of restructuring
09 Feb 17
Preliminary pre-tax profit decreased by 65% to €643m for FY2016 compared to FY2015. Net interest income and trading income was down by 13% to €5.4bn for FY2016 compared to FY2015. Loan loss provisions rose by 29% to €900m in 2016. Revenues before loan loss provisions decreased by 4% to €9.4bn for 2016 compared to 2015. Operating expenses were slightly down by 1% to €7.1bn in the same period. Impairments of goodwill were €627m and positive one-offs were around €400m in FY2016. Commerzbank booked restructuring charges of €129m for FY2016 compared to €114m for FY2015. The tax ratio was 41% for 2016 and 34% for 2015. The net profit after minorities attributable to common shares declined by 74% to €279m for 2016 compared to 2015. The Basel III fully-applied Core Tier 1 ratio was 12.3% at the end of December 2016 compared to 12.0% at year-end 2015 regarding Commerzbank. The RoE was 1.0% for FY2016 compared to 3.8% for FY2015. Commerzbank is paying no dividend for FY2016.
Q3 loss as warned due to restructuring 4.0
04 Nov 16
The pre-tax result was a loss of €255m for Q3 16 versus a profit of €401m for Q3 15. Net interest income was down by 13% to €1.14bn for Q3 16 compared to Q3 15. Loan loss provisions increased by 88% to €275m in Q3 16. Commission income declined by 4% to €777m in Q3 16. Trading income increased by 25% to €367m for Q3 16 compared to Q3 15. Total revenues declined by 5% to €2.2bn in Q3 16 compared to Q3 15. Administrative expenses were down by 1.6% to €1.73bn in the same period. Impairments on goodwill were €627m and restructuring charges €57m in Q3 16. Despite the pre-tax loss there were tax expenses of €14m in Q3 16 as impairments on GW are not tax deductable. The net result after minorities was therefore a loss of €288m for Q3 16 versus a profit of €235m for Q3 15. The Basel 3 fully phased-in core Tier 1 ratio was 11.8% at end September 2016 versus 12.0% at year-end 2015.
29 Sep 16
In response to current market rumours, management confirms that it has presented Commerzbank’s draft strategic and financial objectives until 2020 to the Supervisory Board for consideration. The Board of Managing Directors will decide tomorrow on the strategic objectives after discussions with the Supervisory Board. The objectives presented are as follows: • By the end of 2020, Commerzbank will have sustainably increased its profitability. As part of the “Commerzbank 4.0” strategy, it will concentrate on its core businesses, digitalise 80% of relevant processes, and thereby achieve significant efficiency gains. Its business will be focused on two customer segments, “Private and Small Business Customers” and “Corporate Clients”. • In the context of the decision of the new strategy, goodwill and intangible assets of both Corporates & Markets and Mittelstandsbank will be subjected to an impairment test. This means that most probably around €700m would be written off in Q3 16. Loan loss provisions will be considerably higher than in the first two quarters due to ongoing weakness in the shipping markets. Despite the goodwill write-offs, Commerzbank is expecting a small net profit for 2016 as a whole. • Commerzbank is aiming for a net return on tangible equity (RoTE) of at least 6% by the end of 2020. Should the interest rate environment improve, a net return on tangible equity of at least 8% will be achievable. • The Common Equity Tier 1 (CET 1) ratio, after full application of Basel 3, is expected to stay at around 12% and will be above 12% in 2018, taking into account currently foreseeable regulatory developments. For 2020, the bank expects a ratio of above 13%. • The new focus on the core business will lead to staff reductions amounting to around net 7,300 full-time positions (9,600 gross). To cover its restructuring costs in the region of €1.1bn, Commerzbank will cease dividend payments for the time being and will retain its full earnings.
Pressure on CET1
26 Jul 16
Commerzbank released some preliminary Q2 16 figures. Net profit decreased by 32% to €209m for Q2 16 compared to Q2 15. Operating profit was down by 18% to €342m in the same period. The Common Equity Tier 1 ratio (CET 1) under full application of Basel 3 stood at 11.5% at the end of June 2016 (end of March 2016: 12.0%; end of June 2015: 10.5%) based on preliminary figures. The change in the CET1 ratio mainly results from the following non-operating valuation and methodology effects regarding Commerzbank: • Higher risk-weighted assets (RWA) in particular for operational risks due to the consideration of new external events factored in by external databases representing industrywide damage claims of banks. • Higher pension liabilities due to lower discount factors (reduced from 2% to 1.7%) as well as higher capital deductions from revaluation reserves, in particular driven by higher credit spreads for Italian sovereign debt. Commerzbank is due to publish its final figures for Q2 16 on 2 August 2016.
Weaker Q1 results due to trading weakness
03 May 16
The pre-tax result declined by 56% to €273m for Q1 16 versus Q1 15. Net interest income was down by 9% to €1.33bn for Q1 16 compared to Q1 15. Loan loss provisions decreased by 6% to €148m in Q1 16. Commission income was down by 9% to €821m in Q1 16. Trading income fell by 98% to €13m for Q1 16 compared to Q1 15. Total revenues declined by 17% to €2.3bn in Q1 16 compared to Q1 15. Administrative expenses were down by 2.4% to €1.9bn in the same period. The tax ratio was 31.5% for Q1 16 compared to 35% for Q1 15. The net profit after minorities declined by 56% to €163m for Q1 16 versus Q1 15. The Basel 3 fully phased-in core Tier 1 ratio was unchanged at 12.0% at end March 2016 versus year-end 2015.
Strongly increased profit as expected but still a too low profit level
12 Feb 16
Preliminary pre-tax profit increased from €628m for FY2014 to €1.9bn for FY2015. Net interest income and trading income rose by 5% to €6.3bn for FY2015 compared to FY2014. Loan loss provisions declined by 39% to €696m in 2015. Revenues before loan loss provisions increased by 11% to €9.76bn for 2015 compared to 2014. Operating expenses were up by 3% to €7.16bn in the same period. Other result was a loss of €15m for 2015 compared to €577m for 2014. The tax ratio was 41% for 2014 and 34% for 2015. The net profit after minorities attributable to common shares was €1.06bn for 2015 compared to €266m in 2014. The Basel III fully-applied Core Tier 1 ratio was 12.0% at end December 2015 compared to 9.3% at year-end 2014 regarding Commerzbank. The RoE was 3.8% for FY2015. Management plans to propose a dividend of €0.20 per share for FY2015.
Another positive verdict
20 Mar 17
Burford’s results for 2016 produced another outstanding set of figures. Revenue grew by 60% to $163.4m with strong growth in the litigation finance business and an additional boost from a secondary sale in the Petersen case. On an underlying basis net income grew to $114m, a 75% increase despite the investment in growing capacity which increased costs. A combination of ongoing investment and gains and increases on valuation saw the fair value of the litigation assets increase 67% to $559m, underpinned by a growth in invested capital to $394m. With the results statement there was an announcement of a further sale of 9% of the Petersen case at a valuation of 20 times the cost of investment.
N+1 Singer - Morning Song 22-03-2017
22 Mar 17
Carador Income Fund (CIFU LN) Premium rating restored, high levels of refinancing activity | Cello Group (CLL LN) Outlook getting brighter – watch Pulsar | Eckoh (ECK LN) Largest ever US secure payments win | eg solutions (EGS LN) Full year results in line | Futura Medical (FUM LN) Licensing deal for CSD500 in Portugal | Verona Pharma (VRP LN) Global agreement with QuintilesIMS to support development of RPL554 | Xaar (XAR LN) 2016 results slightly ahead, reduced visibility in 2017
N+1 Singer - N1S Trend spotting - Strategy update
08 Mar 17
In this new product we present some strategy theme updates arising out of our latest analysis of macro trends and economic data and our innovative Quant work. We also look at upcoming events and suggest topping up on some of our Best Ideas for 2017.