Commerzbank it closed the second quarter with profits down by 84% on an annual basis, to 43 million euro, due to the growth in provisions for doubtful loans (+34% to 537 million euro). Analysts had forecast a figure of 65 million euros. However, the shares of the second largest German bank jumped by more than 10 points on the Frankfurt stock exchange in the morning.
Investors then focus on other data. The interest margin decreased by 8,7% to 1,63 billion, but in this case it beat analysts' forecasts (1,38 billion). Commissions also exceeded expectations, reaching 808 million, against forecasts of 796 million.
As for the equity situation, it improved also thanks to the capital increase last May: according to Basel 3 parameters, at the end of June the Common Equity Tier 1 ratio grew to 10,3% from 10,1% at the end of March.
“The implementation of the strategic measures is proceeding as planned and in part even a little faster – commented the CEO, Martin Blessing -. Revenue before provisions for credit losses stabilized in the second quarter.
Chief Financial Officer Stephan Engels said the Detroit default hurt Commerzbank's second-quarter profit, but the bank made "adequate" provisions for its exposure to Detroit debt.
