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Commerzbank is exploring cutting thousands of jobs as it seeks to fend off unwanted advances from Italian bank UniCredit, according to people familiar with the matter.
The plans, which have not yet been formalized, are expected to be unveiled before the works council in the coming weeks, two of the people said. One person familiar with the discussions told the Financial Times that the number was likely to be “in the region of a few thousand.”
Deutsche Bank's new CEO, Bettina Orlop, is scheduled to present an updated strategy on February 13 to show the bank's ability to improve profitability and payouts to shareholders on its own.
UniCredit, led by CEO Andrea Ursel, has built a site in Commerzbank Which has the potential to make it the largest shareholder in the bank if it gets regulatory approval.
Urcel Trump has made no secret of his ambitions regarding Commerzbank, including the complete takeover of the German competitor.
Investors in Commerzbank were generally supportive of the deal – with the exception of the German government, which still holds a 12 percent stake after selling a 4.5 percent stake to UniCredit Bank last year.
Analysts expect the tie-up to result in billions of euros in cost savings, as the enlarged bank eliminates duplicate functions.
The crucial point of resistance from both the unions and the government was potential unicredit To use the ax in Germany, where it already has a German subsidiary, HypoVereinsbank (HVB).
Commerzbank unions have warned that UniCredit's takeover of the banks could put up to 15,000 jobs at stake – an issue that has taken on an added dimension of political sensitivity ahead of the German federal election, which will be held next month.
The prospect of Commerzbank instigating cuts even without the Italian bank being taken over would represent another chapter in the protracted restructuring process.
Commerzbank has already cut thousands of jobs and closed nearly half of its 800 branches since 2021, when former CEO Manfred Knopf embarked on a turnaround effort.
The changes helped boost operating profits and tripled the bank's share price in the past three years, and in 2023 it embarked on the first share buyback program in its history.
But the build-up of UniCredit's stakes has put additional pressure on the German bank to prove it can deliver better profitability and shareholder value as an independent company than as part of the Italian bank's empire.
Germany's second-largest listed bank is struggling to handle higher costs than rivals, including HVB. Orlop has already raised Commerzbank's performance targets since UniCredit's approach in September.
Some insiders have even expressed doubts about whether Commerzbank hopes to make a standalone case that would provide shareholders with greater value from the merger, given the potential synergies involved in the deal.
One of the people familiar with the matter noted that Orlop now plans to accelerate further restructuring, which was previously seen as an option for the future.
Another person familiar with the discussions suggested that job cuts could be driven by digitalization, especially the adoption of artificial intelligence, with IT jobs likely to be “closer” to other European countries outside Germany.
Commerzbank said the strategy update, due to be presented alongside full-year results next month, is still under development, and “we cannot anticipate upcoming discussions in the management and supervisory boards.”
