Commerzbank losses spur job cuts and management revamp

Commerzbank posted a third-quarter loss and will cut 900 jobs as it scales back its loss-making investment bank.

Commerzbank posted a third-quarter loss and will cut 900 jobs as it scales back its loss-making investment bank.

Klaus-Peter Mueller, the chief executive, also announced a reshuffle of the group's management board, and said the bank is open to a potential merger with a rival. He said: "We continue to be open to all reasonable offers."

The German bank reported a net loss of €208m (£145m) yesterday for the three months to September, disappointing analysts who had expected a net profit of about €103m. The pretax loss amounted to €121m, compared with €2.3bn a year ago. A major revamp of the global investment banking business resulted in a €132m charge to help cover the cost of cutting its London workforce by about half to 300, shutting the unit's Tokyo office and slashing its New York staff by three-quarters.

Mr Mueller said: "The situation in our securities unit is still dire. Despite challenging market conditions, there is no acceptable excuse for the operating loss" of €171m at the investment banking division in the third quarter. He said the bank would make a fresh start in investment banking, which will focus on derivatives and structured products and is expected to be profitable again in the fourth quarter.

The unit is being merged into a new corporates and markets division and will be headed by Nicholas Teller, who is currently in charge of corporate banking. He replaces Mehmet Dalman, the former head of the securities division, who quit in September to start his own hedge fund business.

Commerzbank plans to scrap many of the pan-European equity broking and proprietary trading operations within the securities division - after posting a trading loss of €9m in the quarter - and is going to scale back the research department.

The German bank also moved Achim Kassow, the head of its online brokerage Comdirect Bank, to take over the running of retail banking from Martin Blessing, who will oversee a new division for small and medium-sized companies, known as the Mittelstand.

The third-quarter loss means that Commerzbank made a net profit of just €294m in the first nine months of this year, making it tough to reach its full-year goal of about €800m. In the medium term, the bank aims for annual profits of €1bn.

Commerzbank had its credit ratings affirmed yesterday after announcing its results. Fitch Ratings welcomed the downscaling of the investment banking division, adding: "Underlying financial performance is showing a positive trend, as most of the bank's other divisions are benefiting from the cost savings and restructuring measures undertaken in the past two years."

PROMOTED VIDEO
News
ebooksAn unforgettable anthology of contemporary reportage
Life and Style
Britons buy more than 30 million handsets each year, keeping them for an average of 18 months
tech
Arts and Entertainment
Alloysious Massaquoi, 'G' Hastings and Kayus Bankole of Young Fathers are the surprise winners of this year's Mercury Music Prize
musicThe surprise winners of the Mercury Prize – and a very brief acceptance speech
Arts and Entertainment
TV Presenters Ant McPartlin and Dec Donnelly. Winners of the 'Entertainment Programme' award for 'Ant and Dec's Saturday Night Takeaway'
musicAnt and Dec confirmed as hosts of next year's Brit Awards
Arts and Entertainment
Orson Welles made Citizen Kane at 25, and battled with Hollywood film studios thereafter
film
News
video
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Finance Assistant - Part time - 9 month FTC

£20000 - £23250 Per Annum pro rata: Clearwater People Solutions Ltd: Pro rata ...

Marketing Manager

£40 - 48k + Benefits: Guru Careers: We are seeking a Marketing Manager to join...

Market Risk Manager - Investment Banking - Mandarin Speaker

£45,000 - £65,000: Saxton Leigh: Our client is a well-known APAC Corporate and...

Compensation and Benefits Manager - Brentwood - Circa £60,000

£60000 per annum: Ashdown Group: Compensation and Benefits Manager - Compensat...

Day In a Page

Isis in Syria: A general reveals the lack of communication with the US - and his country's awkward relationship with their allies-by-default

A Syrian general speaks

A senior officer of Bashar al-Assad’s regime talks to Robert Fisk about his army’s brutal struggle with Isis, in a dirty war whose challenges include widespread atrocities
‘A bit of a shock...’ Cambridge economist with Glasgow roots becomes Zambia’s acting President

‘A bit of a shock...’ Economist with Glasgow roots becomes Zambia’s acting President

Guy Scott's predecessor, Michael Sata, died in a London hospital this week after a lengthy illness
Fall of the Berlin Wall: History catches up with Erich Honecker - the East German leader who praised the Iron Curtain and claimed it prevented a Third World War

Fall of the Berlin Wall

History catches up with Erich Honecker - the East German leader who praised the Iron Curtain and claimed it prevented a Third World War
How to turn your mobile phone into easy money

Turn your mobile phone into easy money

There are 90 million unused mobiles in the UK, which would be worth £7bn if we cashed them in, says David Crookes
Independent writers remember their Saturday jobs:

Independent writers remember their Saturday jobs

"I have never regarded anything I have done in "the media" as a proper job"
Lyricist Richard Thomas shares his 11-step recipe for creating a hit West End musical

11-step recipe for creating a West End hit

Richard Thomas, the lyricist behind the Jerry Springer and Anna Nicole Smith operas, explains how Bob Dylan, 'Breaking Bad' and even Noam Chomsky inspired his songbook for the new musical 'Made in Dagenham'
Tonke Dragt's The Letter for the King has finally been translated into English ... 50 years on

Buried treasure: The Letter for the King

The coming-of-age tale about a boy and his mission to save a mythical kingdom has sold a million copies since it was written by an eccentric Dutchwoman in 1962. Yet until last year, no one had read it in English
Can instilling a sense of entrepreneurship in pupils have a positive effect on their learning?

The school that means business

Richard Garner heads to Lancashire, where developing the 'dragons' of the future is also helping one community academy to achieve its educational goals
10 best tablets

The world in your pocket: 10 best tablets

They’re thin, they’re light, you can use them for work on the move or keeping entertained
Lutz Pfannenstiel: The goalkeeper who gave up Bayern Munich for the Crazy Gang, Bradford and a whirlwind trawl across continents

Lutz Pfannenstiel interview

The goalkeeper who gave up Bayern Munich for the Crazy Gang, Bradford and a whirlwind trawl across continents
Pete Jenson: Popular Jürgen Klopp can reignite Borussia Dortmund’s season with visit to Bayern Munich

Pete Jenson's a Different League

Popular Klopp can reignite Dortmund’s season with visit to Bayern
John Cantlie video proves that Isis expects victory in Kobani

Cantlie video proves that Isis expects victory in Kobani

The use of the British hostage demonstrates once again the militants' skill and originality in conducting a propaganda war, says Patrick Cockburn
The killer instinct: The man who helps students spot potential murderers

The killer instinct

Phil Chalmers travels the US warning students how to spot possible future murderers, but can his contentious methods really stop the bloodshed?
Clothing the gap: A new exhibition celebrates women who stood apart from the fashion herd

Clothing the gap

A new exhibition celebrates women who stood apart from the fashion herd
Fall of the Berlin Wall: Goodbye to all that - the lost world beyond the Iron Curtain

The Fall of the Berlin Wall

Goodbye to all that - the lost world beyond the Iron Curtain