The Supervisory Board of Commerzbank has approved the austerity package of the institute. Accordingly, 4300 jobs will be canceled and one in five of the total of 1000 branches closed.
The supervisory board had approved the strategy already presented in floor plans last week, the bank said after a two-day meeting of the supervisory board.
The new head of finance will be Bettina Orlopp. The 49-year-old legal and personnel director succeeds Stephan Engels, who had already announced his move to Danske Bank.
With the new "Commerzbank 5.0" strategy, the institute is adapting to the difficult market environment. "We are significantly reducing our cost base while investing heavily in sales and faster digitization," said Group CEO Martin Zielke.
Customers have to adjust to higher fees. In the future, the Commerzbank "prices differentiated benefits," said the Institute. In addition, the bank hopes for higher revenues through the increased use of data.
It now wants to focus on customer growth: By the end of 2023, more than one million new customers are to be won. Inactive customers should, however, be thrown out.
Forecast corrected
The market environment has intensified, which is noticeable especially in the important corporate customer business, it said. Therefore, the bank expects 2019 "no longer rising adjusted income". So far she had been aiming for an increase.
With the package, the partially nationalized money house stands against low interest rates and low earnings. The cornerstones of the plan Commerzbank had already made public last Friday. In spring, the attempt failed to create a strong financial group with Deutsche Bank - now Commerzbank is alone.
Like the industry as a whole, it is under pressure. Private customers as well as SMEs and corporate clients, the institute's two main business areas, are facing tough price wars. The shift from the banking world to higher interest rates has been postponed indefinitely by the European Central Bank, and the parked penalty charges the industry billions.
"Commerzbank 5.0 will invest a total of around 1.6 billion euros in digitization and in further improving our cost efficiency," said outgoing finance chief Engels. Nevertheless, at the end of the renovation work, the return on investment will be meager by international standards, which should be more than four percent in the medium term.
Major European competitors are already achieving returns of more than eight percent; Deutsche Bank, which is in the midst of renovations and plans to eliminate 18,000 jobs worldwide, has set itself a return of 8 percent in 2022.
Sale of mBank shares resolved
The sale of the majority stake in the Polish mBank was also approved at the Supervisory Board meeting. Commerzbank intends to invest part of the proceeds in digital offers.
Commerzbank also wants to integrate its online subsidiary Comdirect. So far, the online bank from Quickborn belongs to about 82.3 percent of the Frankfurt parent company. Commerzbank is offering 11.44 euros per unit certificate to Comdirect's other shareholders.
The price is 25 percent above the Comdirect closing price on 19 September, the day the bank first announced its intention to acquire it. The takeover bid is subject to the condition that the stake increases to at least 90 percent.
