Why Commerzbank closes in red
Commerzbank, the second largest German bank, closed the second quarter of the year with a loss of 527 million. All the details
Commerzbank, the second largest German bank, closed the second quarter of the year with a loss of € 527 million due largely to provisions of over € 500 million for the restructuring plan that provides for incentives for redundancies.
The first half therefore closed with a consolidated loss of € 394 million (€ 183 million in the first quarter profit).
Revenues for the half year grew to 4.35 billion (+ 5.5%), the operating result was positive in the six months for 570 million (32 million in the second quarter). Commerzbank has a Cet1 capital ratio of 13.4 percent unchanged from last year. Satisfaction on the part of the bank's top management who underlines the further progress made in the quarter in terms of digitization.
In the face of a higher than expected loss on the Frankfurt stock exchange, Commerzbank shares lost 4.41% and slipped to € 5.20, writes Mf .
“Another set of transformative outcomes that failed consensus,” Jefferies commented. "With most of the restructuring costs accounted for, the second half will be focused on underlying trends." For Citi, Commerzbank's second quarter 2021 results are messy with lots of one-offs, as expected.
However, “capital is again better than expected with a Cet1 of 13.4%, + 20bps beyond analyst consensus expectations and this reinforces our view that Commerzbank continues to have enough capital to finance the restructuring and eventually reboot. the return of capital in 2023 ", Citi specified, also noting that the consensus of analysts is in line with the 2021 outlook: expected revenues just above 8.2 billion in 2020 (8.33 billion the consensus estimate), costs to approximately 6.7 billion of which 6.5 billion of opex and 200 million of one-off write-downs (consensus 6.7 billion), positive operating result, Cet1 at 13% (previously above 12.5%; consensus 12.9% ).
However, Citi reiterated the neutral rating and target price of € 6.30 on the Commerzbank share, as it sees downside risks on the stock exchange, particularly in light of the risk of deterioration of restructuring revenues.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/perche-commerzbank-chiude-in-rosso/ on Wed, 04 Aug 2021 08:28:19 +0000.