Commerzbank fails to rule out Dublin cuts in restructure
GERMAN banking giant Commerzbank has failed to rule out cuts to its Dublin business as the group contemplates a €30bn asset-sales programme and faces the prospect of another state bailout.
Already 25pc owned by the German state, Commerzbank has until January 20 to outline plans to hit the €5.3bn capital-raising target imposed on the bank by the latest Europe-wide stress tests.
The bank has publicly said it would reach this target through a €30bn asset sale, but speculation has been mounting that some element of a state rescue will also be needed.
Asked whether the Irish operations could be affected by the capital raising and asset sales, a spokesman for Commerzbank said the group was not giving a "regional breakdown" on the €30bn target.
"Unfortunately, we cannot give you any further information about possible asset sales," he added.
IFSC-based Commerzbank Europe specialises in international financing and also invests in asset-backed securities.
Its latest accounts show the operation has shrunk significantly, with its interest receivable almost halving to €16.7m last year. The fall was described as "in line with the deleveraging strategy" of Commerzbank. In notes to the accounts, Commerzbank Europe's directors said the deleveraging would continue into 2011.
The operation swung to a €3.5m loss in 2010 after taking a €6.9m provision for bad debts. The result was sharply worse than the €9.2m profit in 2009.