Bulletin: Commerzbank's Q1 2020 Loss And Abandoned Sale Of mBank Highlight Restructuring Hurdles

FRANKFURT (S&P Global Ratings) May 13, 2020--S&P Global Ratings today said that Commerzbank AG's (BBB+/Negative/A-2) loss in first-quarter (Q1) 2020 and decision to retain a majority stake in its independently operating Polish subsidiary, mBank (BBB/Negative/A-2), do not immediately affect the ratings on either bank. Earlier this week, Commerzbank announced that it had called off the sale of mBank, and today it posted a €295 million after-tax loss for Q1 2020, dominated by €479 million of extraordinary effects, due partly to anticipating the expected full-year economic impact of the COVID-19 pandemic. Commerzbank's regulatory Tier 1 ratio worsened only mildly to 13.2% from 13.4% at end-2019. These developments are broadly in line with our base-case expectation that increased risks in Commerzbank's main

...May 13, 2020 FRANKFURT (S&P Global Ratings) May 13, 2020--S&P Global Ratings today said that Commerzbank AG's (###+/Negative/A-2) loss in first-quarter (Q1) 2020 and decision to retain a majority stake in its independently operating Polish subsidiary, mBank (###/Negative/A-2), do not immediately affect the ratings on either bank. Earlier this week, Commerzbank announced that it had called off the sale of mBank, and today it posted a 295 million after-tax loss for Q1 2020, dominated by 479 million of extraordinary effects, due partly to anticipating the expected full-year economic impact of the COVID-19 pandemic. Commerzbank's regulatory Tier 1 ratio worsened only mildly to 13.2% from 13.4% at end-2019. These developments are broadly in line with our base-case expectation that increased risks in Commerzbank's main markets are likely to weigh on its revenue and asset quality, and moderately weaken capitalization (see "Commerzbank AG Downgraded To '###+' On Vulnerability In The Wake Of COVID-19...

Bulletin