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Bond Market News
Germany Pauses Disposal of Commerzbank’s Shares
September 24, 2024
Germany announced that it will pause a planned disposal of its stake in Commerzbank. The move comes in response to the recent takeover attempt by Italian rival, UniCredit. The government agency said that it “will not, until further notice, sell any additional shares. This also includes sales related to any share buybacks”. Germany is still the largest lender of Commerzbank, owning about 12% stake. Earlier UniCredit’s CEO Andrea Orcel had surprised the markets earlier this month by disclosing a 9% stake in Commerzbank and saying he was considering a full takeover. Markets had welcomed the prospect of the EU’s largest cross-border bank deal since the financial crisis lifting the shares of both banks. UniCredit is also planning to seek ECB approval to build up to 30% stake in Commerzbank, as reported earlier. As a result of move by Germany, Commerzbank’s shares declined by ~6.2% in yesterday’s trading session.
Commerzbank’s bonds traded stable with its € 4.25% Perp at 93.2, yielding 6.8%.
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