Commerzbank unexpectedly released its quarterly results on Friday, highlighting a “record” annual profit and introducing a new share buyback program. The bank reported a 20% rise in net profit to 2.68 billion euros ($2.78 billion) in 2024, surpassing the consensus estimate of $2.47 billion cited by Reuters.
The bank outlined plans to repurchase 400 million euros of shares and proposed increasing its dividend payout to 0.65 euros per share, up from 0.35 euros per share the previous year. Following the announcement, shares in the bank closed 1.7% higher.
In 2024, Commerzbank reported a net income of 8.33 billion euros, slightly lower than the previous year’s 8.37 billion euros. The bank attributed this to foreign exchange valuation effects in the fourth quarter. Its return on tangible equity rose to 9.2% in 2024 from 7.7% in 2023, surpassing the group’s target of at least 8%.
Originally scheduled for release on Feb. 13, the bank’s fourth-quarter and annual earnings were disclosed early due to German legal requirements triggered by the significant deviation from capital market expectations.
Commerzbank has been advocating for independence following a surprise stake acquisition by Italy’s UniCredit, which now holds a direct 9.5% stake and an 18.5% stake through derivatives in Commerzbank. The German government has expressed opposition to UniCredit’s actions, with Finance Minister Jörg Kukies criticizing the bid in a recent CNBC interview.
Commerzbank’s CEO, Bettina Orlopp, attributed the profit growth to effective cost management and growth initiatives, promising further capital returns in the future. UniCredit, since its initial move in September, has also initiated a takeover bid for Italian peer Banco BPM, raising speculation on its next steps in either the domestic Italian or German market.
