FRANKFURT, GERMANY (MARCH 17, 2019) (REUTERS) – Deutsche Bank and Commerzbank on Sunday (March 17) confirmed they were in talks to possibly merge, an indication that efforts to combine Germany’s two largest lenders are gaining pace.
Formal disclosure of talks increases the chances of concluding a tie-up that has long been the subject of speculation and surfaced in 2016 before both banks decided to focus on restructuring.
The German government has pushed for a combination given concerns about the health of Deutsche, which has struggled to generate sustainable profits since the 2008 financial crisis.
The government, which holds a stake of more than 15 percent in Commerzbank following a bailout, wants a national banking champion to support its export-led economy, best known for cars and machine tools.
The merged bank would have roughly 1.8 trillion euros in assets, such as loans and investments, and a market value of about 25 billion euros ($28.3 billion), based on Friday’s (March 15) closing stock prices.