Deutsche Bank and Commerzbank Ditch Merger Discussions
Posted on 04/25/2019
Deutsche Bank AG and Commerzbank AG abandoned merger talks. Prodded by Germany’s Finance Ministry and after weeks of negotiation, the two German mega banks failed to overcome both economic and political obstacles to combine the banks. The banks agreed that a merger would not be in the interests of either bank’s shareholders or other stakeholders. The banks were concerned that execution risks, restructuring costs, and the necessity to raise money from investors to finance the transaction would have outweighed the benefits.
Deutsche Bank plans to continue to review all alternatives to improve long-term profitability and shareholder returns.
Commerzbank is still 15% owned by the German government. Commerzbank received a financial bailout from the German government in 2009.
