Commerzbankâ€™s Recovery Still Unclear as Economy Weakens
Germany's prestigious No. 2 bank is facing extreme crisis and is not expecting any recovery from the same as European market is weakening.
Commerzbank CEO, Martin Blessing said that the market will remain volatile in the coming months and he informed that the bank's profit in fourth quarter was lower than that in the third. Since the provisions on bad loans are likely to rise, no rise in the market could be expected, as of now.
Shares of the bank came down by 0.1 percent this morning. It has reported a net loss of 687-million-euro this year. But it positive gained 78 million euros in the third quarter.
"The main question is what will happen with the 160 billion euros in the non-core-assets unit. Those have to be shed elegantly without again causing a lot of costs", said Kepler Capital Markets analyst Dirk Becker.
The bank is planning to cut jobs in the wake of heavy crisis that it is facing with market going down with every passing day. Revenues have decreased due to low interest rates that enlighten the effect of falling economy.
Two years ahead of the schedule, the bank had planned to pay back the long-term refinancing loans to European Central Bank in the first quarter of 2013, which now seems impossible.