The Frankfurt-listed lender, which wants to be more profitable, sees the wealth and asset management side of the business as important expansion areas.

Commerzbank, which is in a tussle to ward off a takeover bid by Italy’s UniCredit, yesterday reported a pre-tax profit of €3.833 billion ($3.99 billion) for 2024, a gain of 12.7 per cent on a year before. The net result, after taxes and other factors, was €2.7 billion, rising 20.2 per cent.

Now the German bank said it aims to accelerate profits growth, with a “strategic focus” on expanding its wealth and asset management businesses, and in its corporate clients area.

Investors appeared reassured by the figures; shares in Commerzbank closed up at 1.6 per cent yesterday.

For months, attention on European markets has focused on a possible bid by UniCredit for Commerzbank. To foil this move, Commerzbank needs to hike profitability and also pay more back to shareholders. Commerzbank said it will give back a total of around €1.73 billion – 71 per cent of its net result after deduction of AT1 coupons – to its shareholders for the financial year 2024. Part of the capital return is the bank’s third share buyback programme.

For 2025, the planned pay-out ratio is to be 100 per cent of its net result after deduction of AT1 coupons and before restructuring charges for transformation; for 2026 to 2028, the pay-out ratio will also be all of the net result, minus certain deductions, provided strategy is successfully put into practice, as well as the macroeconomic environment.

To curb costs, the bank intends to axe about 3,900 full-time roles over the coming years, mostly across support functions in Frankfurt.

Commerzbank said total revenues rose by 6.2 per cent to €11.106 billion. Operating expenses rose by 4 per cent to €6.244 billion. There was a drop in restructuring costs last year, it said in a statement. 

The 2025 net result target stands at €2.4 billion, or €2.8 billion before transformation restructuring charges. For 2028, the net result target is €4.2 billion, with a return on equity at 15 per cent. 

“We have delivered again. With yet another record result, we have shown that we are creating substantial added value for our shareholders, customers, and employees. We have significantly increased our profitability, expanded our fee business as previously announced, continued to improve our cost-income ratio, and are an even more attractive employer. This provides us with a strong basis for the years to come,” Bettina Orlopp (pictured), CEO, said. 

The bank’s Common Equity Tier 1 ratio – a common measure of a bank’s capital shock absorber – rose to 15.1 per cent.