The German group reported half-year results that confirm the general upward trend observed since the pandemic.
The profit targets for the year were confirmed and the return on equity is – finally! – in line with the average of other large European banks.
The share of defaulted loans remains negligible and the volume of loans is stable, including in the real estate sector. There was a significant improvement in deposits, which increased by a further EUR 2 billion this quarter.
This overall good result is all the more remarkable given that it takes place in a very tense economic environment in Germany. If there are any signs of a recession, then they are elsewhere than at Commerzbank.
Given its comfortable capital base and still low valuation, the group now wants to pull out all the stops when it comes to share buybacks. A new tranche of 600 million euros is waiting for the green light from the ECB.
If the regulator gives it a free hand, Commerzbank could return as much capital to its shareholders in 2024 as it did in the last two years combined. These ambitions have not escaped the market, which perhaps imagined a little too quickly that a remake of the resurrection of UniCredit.
With a market capitalization of about half the value of its tangible equity, Commerzbank is still behind the British, Italian and French banks – with the notable exception of Société Générale.
