Com­merzbank to in­vest more in its core busi­ness

The Pak Banker - - Front Page -

FRANKFURT

In the coming years, Com­merzbank will adapt its busi­ness model to the new frame­work con­di­tions in the fi­nan­cial sec­tor and will con­cen­trate on fo­cused growth.

In the frame­work of its strate­gic agenda un­til 2016, the Bank is in­vest­ing more than EUR 2.0 bil­lion in the rev­enues power of its core busi­ness. At the same time and due to ad­di­tional ef­fi­ciency mea­sures, it is main­tain­ing its costs at a con­stant level and is fur­ther op­ti­mis­ing its cap­i­tal base. In 2016, the Bank in­tends to achieve a re­turn on eq­uity af­ter taxes (RoE) of more than 10% in its core busi­ness. The costin­come ra­tio (CIR) of the Core Bank with the op­er­at­ing seg­ments Pri­vate Cus­tomers, Mit­tel­stands­bank, Cor­po­rates & Mar­kets, and Cen­tral & East­ern Europe is to be low­ered to around 60%. Tak­ing into con­sid­er­a­tion the phase-in of Basel 3, the Core Tier 1 ra­tio of the Group shall al­ways be com­fort­ably above 9% un­til the end of 2016. In ad­di­tion, it is planned to re­duce the port­fo­lios in the Non-Core As­sets (NCA) seg­ment by more than 40% un­til 2016 (as of the end of Septem­ber 2012: EUR 160 bil­lion Ex­po­sure at de­fault, EaD).

There can be no re­turn to ‘busi­ness as usual’ in the bank­ing in­dus­try. Re­gain­ing the trust of cus­tomers will be the most im­por­tant task for all banks in the coming years.

Com­merzbank is thus re­act­ing to the chal­lenges posed by the fi­nan­cial mar­ket and sov­er­eign debt cri­sis and to the re­sult­ing “new nor­mal­ity” in the fi­nan­cial sec­tor - namely tougher re­quire­ments for the cap­i­tal base of banks, on­go­ing low in­ter­est rate lev­els and a loss of trust on the part of cus­tomers. In past years, we have re­duced costs, low­ered risks and suc­cess­fully com­pleted the in­te­gra­tion of Dres­d­ner Bank. Now we will con­sis­tently adapt our busi­ness model and our pro­cesses to the chang­ing mar­ket con­di­tions. Thus we will have a strong base, which we can utilise for fur­ther growth, said Stephan En­gels, Chief Fi­nan­cial Of­fi­cer of Com­merzbank.

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