Deutsche CEO makes case for Commerzbank merger
frankfurt — Christian Sewing, the chief executive officer of Deutsche Bank, believes there is a strong case for a merger with rival Commerzbank, according to a person with direct knowledge of his thinking.
Sewing’s stance sets the stage for a showdown with unions fearing massive job cuts and some sceptical investors. The supervisory boards of both banks were to meet on Thursday.
Sewing sees multiple benefits of a merger, including “clear” dominance in its home market, scale and shared technology costs, the person said.
Deutsche’s CEO also believes that a combined entity would improve the cost of funding, with “the best funding ever”, the person said. Jobs would be cut with or without a merger, the person said.
Deutsche Bank and Commerzbank declined to comment.
The position marks a shift in Sewing’s position. In past months, he has urged patience, preferring to focus on internal restructuring before taking on a big project, according to other people with knowledge of his thinking.
The comments also contrast with the neutral tone set in a letter to employees on Sunday after both Deutsche and Commerzbank confirmed talks. Sewing said then that many factors could still prevent a merger.
Deutsche Bank would not have entered talks if the bank expected negotiations to fail, said a second person with knowledge of Sewing’s thinking. The powerful Verdi labour union, which sits on the supervisory boards of both banks, has voiced fierce objections to a merger, saying that as many as 30,000 jobs are at risk over the long term.
Both banks currently employ 140,000 worldwide. A spokeswoman for Verdi said on Thursday
that the union’s position hasn’t changed.
At least three of Deutsche Bank’s top investors have voiced reservations about a merger, according to
three people with knowledge of the matter. Two of them are awaiting details from Sewing and his colleagues at Thursday’s meeting, two of the people said. —