Martin Blessing: "We have reached important strategic targets in 2011 and shown that our business model also functions under difficult framework conditions."
The focus of today's Annual General Meeting of Commerzbank AG is on the resolutions on the election of Dr. Gertrude Tumpel-Gugerell as a new member of the Supervisory Board and on the regular adjustment of the capital resolutions. The 2012 Annual General Meeting will also decide on options for further improvement of the capital structure. The Annual General Meeting of Commerzbank is taking place in the Jahrhunderthalle in Frankfurt am Main.
Klaus-Peter Müller, Chairman of the Supervisory Board of Commerzbank, said in the run-up to the Annual General Meeting: "In the 2011 financial year Commerzbank improved the result of its Core Bank and reduced risks considerably despite a difficult market environment. It has also made a solid start into 2012 in spite of the challenging market conditions. The overall sector trend of lower revenues has also become noticeable at Commerzbank, however. Yet it was able to largely compensate for this through consistent management of the costs and risks."
The Chairman of the Board of Managing Directors of Commerzbank, Martin Blessing, said: "Despite all the adversities, we have achieved important strategic goals in 2011: Firstly, we have successfully concluded the project to integrate Dresdner Bank. Secondly, we have proven that our business model functions even under difficult framework conditions. Thirdly, we have largely reduced the silent participations of the Financial Market Stabilisation Fund (SoFFin). And not least of all we have been able to considerably improve our capital structure through a number of measures."
In the 2011 financial year Commerzbank increased the operating profit of the Core Bank, which encompasses the strategically significant customer-centric business, to EUR 4.5 billion (2010: EUR 2.0 billion). The revenues before loan loss provisions rose at the Core Bank by 14 % to EUR 12.4 billion (2010: EUR 10.9 billion). In contrast to this pleasing development, the non-core areas were clearly impacted by the effects of the sovereign debt crisis. In particular, valuation adjustments on Greek sovereign bonds, as well as the continued de-risking in the Public Finance segment, have led to considerable charges on the result. Nevertheless, in the 2011 financial year the Bank posted a Group net profit of EUR 638 million.
In the 2011 business year the Bank adjusted the value of the portfolios of Greek sovereign bonds by some EUR 2.2 billion. The strategy of risk reduction will be consistently continued. The Bank divested its portfolio of Greek sovereign bonds and further reduced its portfolios in commercial real estate financing and public finance.
"We are continuing to make good progress with de-risking and the portfolio reduction in non-core areas. Alone in the first quarter of 2012 we have lowered the risk-weighted assets by a further EUR 14 billion to EUR 223 billion. At the same time our Core Tier 1 ratio as of the end of March 2012 has increased to a comfortable 11.3 %. Thus we are well prepared for the new regulatory capital requirements pursuant to Basel 3 ¿ which are valid as of 2013 onwards," said Blessing.
Also in the current 2012 financial year Commerzbank has already been able to reach key strategic goals: At the end of March the decision by the European Commission brought clarity for the future orientation of Eurohypo. Accordingly, Eurohypo no longer has to be sold, as originally demanded, by 2014. Instead the Bank will wind down the public finance business and the bulk of the commercial real estate financing. Only a small, less risky area of the Commercial Real Estate business will be continued in Commerzbank.
In addition, Commerzbank has already fulfilled the requirements of the European Banking Authority (EBA). The background to this was the target set by the Council of the European Union last year. Pursuant to this, 71 European banks operating internationally have, as of June 30, 2012, to comply with a Core Tier 1 ratio of 9 % after accounting for the effects of a simulated partial default of European sovereign bonds. That is significantly higher than the current regulatory requirement. The EBA originally determined a capital target of approximately EUR 5.3 billion for Commerzbank.
"We have not only reached the EBA capital target ahead of schedule, but actually surpassed this. That we have done so as of the end of March 2012 on our own and one quarter earlier than required shows the strength in implementation and the high willingness to perform of Commerzbank," said Blessing.
Under www.commerzbank.com/agm you can find the agenda, further documents on the Annual General Meeting, as well as a link for the live broadcast of the speeches by the Chairman of the Supervisory and the Chairman of the Board of Managing Directors.
Commerzbank is a leading bank for private and corporate customers in Germany. With the segments Private Customers, Mittelstandsbank, Corporates & Markets, Central & Eastern Europe as well as Asset Based Finance, the Bank offers its customers an attractive product portfolio, and is a strong partner for the export-oriented SME sector in Germany and worldwide. With a future total of some 1,200 branches, Commerzbank has one of the densest networks of branches among German private banks. It has around 60 sites in 52 countries and serves more than 15 million private clients as well as 1 million business and corporate clients worldwide. In 2011, it posted gross revenues of almost EUR 10 billion with 58,160 employees.
This release contains statements concerning the expected future business of Commerzbank, efficiency gains and expected synergies, expected growth prospects and other opportunities for an increase in value of the company as well as expected future net income per share, restructuring costs and other financial developments and information. These forward-looking statements are based on the management's current expectations, estimates and projections. They are subject to a number of assumptions and involve known and unknown risks, uncertainties and other factors that may cause actual results and developments to differ materially from any future results and developments expressed or implied by such forward-looking statements. Commerzbank has no obligation to periodically update or release any revisions to the forward-looking statements contained in this release to reflect events or circumstances after the date of this release.