The ratings on Germany-based Commerzbank AG reflect its sound strategy and business profile and improved financial profile, based on reduced credit losses and higher profitability levels compared with earlier years. This is underpinned by the still favorable domestic credit environment. The ratings are mainly constrained by the bank's profitability, which was unsatisfactory in the second half of 2007 and compares unfavorably with higher rated peers. This is partly the result of the bank's concentration on the German market, where industry risk is higher than in other European countries. Standard&Poor's Ratings Services expects the bank to be able to manage the direct implications of the U.S. subprime mortgage-market disruptions. In 2007, Commerzbank took a charge of €583 million against
