The ratings on Germany-based Commerzbank AG reflect its sound credit-risk management and the bank's domestic franchise among private and corporate customers, which provides it with a sound and diversified funding base and gradually improving earnings following a prolonged restructuring phase, which is nearing completion. The primary negative rating factors remain the bank's still modest core profitability and market position in a highly competitive and structurally difficult domestic market environment as well as its limited franchise outside Germany, all of which confine the prospects for substantial revenue growth as long as economic growth remains subdued. On Nov. 16, 2005, Standard&Poor's Ratings Services affirmed its ratings on Commerzbank after the bank announced it would increase its stake in Eurohypo AG
