Commerzbank AG () is a major German bank operating as a

universal bank A universal bank participates in many kinds of banking activities and is both a commercial bank and an investment bank as well as providing other financial services such as insurance.Frankfurt am Main Frankfurt, officially Frankfurt am Main (; Hessian: , " Frank ford on the Main"), is the most populous city in the German state of Hesse. Its 791,000 inhabitants as of 2022 make it the fifth-most populous city in Germany. Located on it ...

. In the 2019 financial year, the bank was the second largest in

Germany Germany,, officially the Federal Republic of Germany, is a country in Central Europe. It is the second most populous country in Europe after Russia, and the most populous member state of the European Union. Germany is situated betwee ...

by the total value of its balance sheet. Founded in 1870 in

Hamburg Hamburg (, ; nds, label=Hamburg German, Low Saxon, Hamborg ), officially the Free and Hanseatic City of Hamburg (german: Freie und Hansestadt Hamburg; nds, label=Low Saxon, Friee un Hansestadt Hamborg),. is the List of cities in Germany by popul ...

, the bank is today present in more than 50 countries around the world and provides almost a third of Germany's

trade finance Trade finance is a phrase used to describe different strategies that are employed to make international trade easier. It signifies financing for trade, and it concerns both domestic and international trade transactions. A trade transaction require ...

. In 2017, it handled 13 million customers in Germany and 5 million customers in

Central Central is an adjective usually referring to being in the center of some place or (mathematical) object. Central may also refer to: Directions and generalised locations * Central Africa, a region in the centre of Africa continent, also known a ...

and

Eastern Europe Eastern Europe is a subregion of the European continent. As a largely ambiguous term, it has a wide range of geopolitical, geographical, ethnic, cultural, and socio-economic connotations. The vast majority of the region is covered by Russia, whi ...

. Commerzbank is a member of the Cash Group. 15% of the shares are owned by the

Federal Republic of Germany Germany,, officially the Federal Republic of Germany, is a country in Central Europe. It is the second most populous country in Europe after Russia, and the most populous member state of the European Union. Germany is situated between ...

and 85% are in free float.

History

Empire

On 26 February 1870, mainly Hanseatic merchants, merchant bankers and private bankers founded the Commerz- and Disconto-Bank in Hamburg. Shipowner C. Woermann was the first chairman of the supervisory board of Commerz- und Disconto-Bank from 1870.Commerzbank's history
on Commerzbank AG site. In the founding consortium, the following banks were represented: * Theodor Wille (Theodor Wille, Hamburg) * Carl Woermann (C. Woermann, Hamburg) * Alexander Mendelssohn ( Bankhaus Mendelssohn & Co., Berlin) * Ludwig Erdwin Amsinck (of L.E. Amsinck & Co., New York City) * Conrad Hinrich Donner III. (Conrad Hinrich Donner, Altona) * Carl Georg Heise (Carl Geo. Heise, Hamburg) * Georg Hesse ( Hesse, Newman & Co., Altona) * Leopold Lieben (Lieben Königswarter, Hamburg) * Jacques Emile Louis Alexander Nölting (Emile Nölting & Co., Hamburg) * Albrecht Percy O'Swald (Wm. O'Swald & Co., Hamburg) * Ernst Friedrich Sieveking (Vertreter von B.H. Goldschmidt, Frankfurt am Main, und Mendelssohn & Co., Berlin) *

Siegmund Warburg Sir Siegmund George Warburg (30 September 1902 – 18 October 1982) was a German-born English banker. He was a member of the prominent Warburg family. He played a prominent role in the development of merchant banking.M. M. Warburg & Co., Hamburg) In 1873, the subsidiary London and Hanseatic Bank was founded, which was active until the First World War. In Germany, Commerzbank was initially active in Hamburg until 1897 branches were built in Berlin and Frankfurt am Main. After the merger in 1905 with the Berliner Bank, founded in 1871, the focus shifted increasingly to Berlin.

Weimar Republic

In 1920, Commerzbank AG merged with Mitteldeutsche Privatbank AG in

Magdeburg Magdeburg (; nds, label=Low Saxon, Meideborg ) is the capital and second-largest city of the German state Saxony-Anhalt. The city is situated at the Elbe river. Otto I, the first Holy Roman Emperor and founder of the Archdiocese of Magdebu ...

to form ''Commerz- und Privat-Bank AG'', thereby gaining a dense branch network in the provinces of

Saxony Saxony (german: Sachsen ; Upper Saxon German, Upper Saxon: ''Saggsn''; hsb, Sakska), officially the Free State of Saxony (german: Freistaat Sachsen, links=no ; Upper Saxon: ''Freischdaad Saggsn''; hsb, Swobodny stat Sakska, links=no), is a ...

and

Thuringia Thuringia (; german: Thüringen ), officially the Free State of Thuringia ( ), is a state of central Germany, covering , the sixth smallest of the sixteen German states. It has a population of about 2.1 million. Erfurt is the capital and lar ...

. In the early 1920s, many smaller banks were taken over (including the Hessian Bank Association) and in 1929 it merged with the Mitteldeutsche Creditbank in

Frankfurt am Main Frankfurt, officially Frankfurt am Main (; Hessian: , " Frank ford on the Main"), is the most populous city in the German state of Hesse. Its 791,000 inhabitants as of 2022 make it the fifth-most populous city in Germany. Located on it ...

. In 1927, Commerzbank increased business in the US by establishing an office in New York and issuing a ten-year, $20-million-dollar bond. In 1931, during the

Great Depression The Great Depression (19291939) was an economic shock that impacted most countries across the world. It was a period of economic depression that became evident after a major fall in stock prices in the United States. The economic contagio ...

Commerzbank, ran into difficulties. The Reich government under

Chancellor Chancellor ( la, cancellarius) is a title of various official positions in the governments of many nations. The original chancellors were the of Roman courts of justice—ushers, who sat at the or lattice work screens of a basilica or law cou ...

Heinrich Brüning decided in February 1932 to merge Commerzbank with Barmer Bankverein, which had a dense branch network in northern and western Germany. Majority of shares of this bank were bought by the government and the Reichsbank.

Third Reich

In 1937, the nationalized shares were then transferred back to private shareholders. In 1940, the name Commerzbank Aktiengesellschaft, which had already been used in public, was adopted and the logo changed to "C" with side wings. Through Aryanization of the property of Jews displaced or murdered during the

Holocaust The Holocaust, also known as the Shoah, was the genocide of European Jews during World War II. Between 1941 and 1945, Nazi Germany and its collaborators systematically murdered some six million Jews across German-occupied Europe; ...

, Commerzbank participated and benefited mostly through brokerage commissions. From 1940 to 1944, Commerzbank opened several subsidiaries in countries occupied by the German Reich, including the

Netherlands ) , anthem = ( en, "William of Nassau") , image_map = , map_caption = , subdivision_type = Sovereign state , subdivision_name = Kingdom of the Netherlands , established_title = Before independence , established_date = Spanish Netherl ...

Belgium Belgium, ; french: Belgique ; german: Belgien officially the Kingdom of Belgium, is a country in Northwestern Europe. The country is bordered by the Netherlands to the north, Germany to the east, Luxembourg to the southeast, France to ...

Estonia Estonia, formally the Republic of Estonia, is a country by the Baltic Sea in Northern Europe. It is bordered to the north by the Gulf of Finland across from Finland, to the west by the sea across from Sweden, to the south by Latvia, an ...

and

Latvia Latvia ( or ; lv, Latvija ; ltg, Latveja; liv, Leţmō), officially the Republic of Latvia ( lv, Latvijas Republika, links=no, ltg, Latvejas Republika, links=no, liv, Leţmō Vabāmō, links=no), is a country in the Baltic region of ...

. Towards the end of the war, the bank's headquarters moved to Hamburg.

Allied Occupation

With the division of Europe after

World War II World War II or the Second World War, often abbreviated as WWII or WW2, was a world war that lasted from 1939 to 1945. It involved the World War II by country, vast majority of the world's countries—including all of the great power ...

, three regional banks were united in 1958 to form Commerzbank AG, which had its headquarters in

Düsseldorf Düsseldorf ( , , ; often in English sources; Low Franconian and Ripuarian: ''Düsseldörp'' ; archaic nl, Dusseldorp ) is the capital city of North Rhine-Westphalia, the most populous state of Germany. It is the second-largest city in ...

. Commerzbank stepped up its economic financing activities and started expanding around the globe. From 1970 onwards, the bank's administrative activities were shifted to Frankfurt am Main, which has been its legal domicile since 1990. * British Occupation Zone ** Bankverein Westdeutschland in

** Hansa-Bank in

** Merkur-Bank in

Hannover Hanover (; german: Hannover ; nds, Hannober) is the capital and largest city of the German state of Lower Saxony. Its 535,932 (2021) inhabitants make it the 13th-largest city in Germany as well as the fourth-largest city in Northern Germany ...

** Holsten-Bank in

Kiel Kiel () is the capital and most populous city in the northern German state of Schleswig-Holstein, with a population of 246,243 (2021). Kiel lies approximately north of Hamburg. Due to its geographic location in the southeast of the Jutland ...

* French Occupation Zone ** Mittelrheinische Bank in

Mainz Mainz () is the capital and largest city of Rhineland-Palatinate, Germany. Mainz is on the left bank of the Rhine, opposite to the place that the Main joins the Rhine. Downstream of the confluence, the Rhine flows to the north-west, with Ma ...

* American Occupation Zone ** Mitteldeutsche Creditbank in

** Bankverein für Württemberg-Baden in

Stuttgart Stuttgart (; Swabian: ; ) is the capital and largest city of the German state of Baden-Württemberg. It is located on the Neckar river in a fertile valley known as the ''Stuttgarter Kessel'' (Stuttgart Cauldron) and lies an hour from the Sw ...

** Bayerische Disconto-Bank in Nürnberg ** Bremer Handels-Bank in Bremen

Federal Republic

Commerzbank suffered reversals in a disastrous foray into investment banking in the first half decade of the 2000s and eventually shut down its Commerzbank Securities investment banking unit run by Mehmet Dalman and Roman Schmidt after Chairman

Klaus-Peter Müller Klaus-Peter Müller (born 16 September 1944 in Duppach, Germany) was chairman of the supervisory board of Commerzbank until the annual general meeting on 8 May 2018. Career Klaus-Peter Müller is the son of Peter Müller, a former voluntary ...

labelled it a "problem child" and a review by consulting firm Mercer Oliver Wyman which concluded that Commerzbank Securities lacked a viable business model. What was left of Commerzbank Securities was folded into a division of the commercial bank called Corporates and Markets.

Acquisition of Dresdner Bank

Further mergers, acquisitions and restructures saw the group grow to servicing over 4 million customers in 1998, 6 million customers in 2001 and 15 million post the global financial crisis oriented takeover of Dresdner Bank from

Allianz Allianz ( , ) is a German multinational financial services company headquartered in Munich, Germany. Its core businesses are insurance and asset management. The company is one of the world's largest insurers and financial services groups. Th ...

for €5.5 billion in 2008. Commerzbank was hit hard by the financial crisis and received an €18 billion ($22.3 billion) state bailout. In September 2016, Commerzbank planned to cut 9,600 jobs or about a fifth of its workforce in 4 years. In late 2019, Commerzbank entered into talks with Petrus Advisers to buy its 7.5% stake in

Comdirect Commerzbank AG () is a major German bank operating as a universal bank, headquartered in Frankfurt am Main. In the 2019 financial year, the bank was the second largest in Germany by the total value of its balance sheet. Founded in 1870 in Hambu ...

and take over the entire online bank. In 2021 the bank announced it will reduce the number of branches in Germany from 790 to 450 and cut jobs by 10,000 (a third of its German workforce) by 2024.

Shareholders and management

As of December 2018, the bank's two largest shareholders were the Government of Germany (15.6%) and Cerberus Capital Management (5.01%). In July 2020, the bank's chairman Stefan Schmittmann announced that he will be resigning by August 3. Subsequently, Martin Zielke, Commerzbank's chief executive said that he is ready to step out of its function. The decisions were made after in June 2020, Cerberus attacked the firm's leadership team, "significant change at the supervisory board, the management board and the company’s strategic plan to stop a 'downward spiral' caused by what the investor said were bloated costs, low profits and managerial inaction." In the Q2 of 2020, the company made an operating profit of €205 million; it was 34 per cent less compared to the same period of 2019. "According to people familiar with the matter", the bank's profit was more affected by the insolvency of Wirecard than the economic effects of the

COVID-19 pandemic The COVID-19 pandemic, also known as the coronavirus pandemic, is an ongoing global pandemic of coronavirus disease 2019 (COVID-19) caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2). The novel virus was first identi ...

. In September 2020, the bank named

Deutsche Bank AG Deutsche Bank AG (), sometimes referred to simply as Deutsche, is a German multinational investment bank and financial services company headquartered in Frankfurt, Germany, and dual-listed on the Frankfurt Stock Exchange and the New York Stoc ...

German retail head Manfred Knof to take over as the chief executive officer on Jan 1, 2021.

Controversies

For more than a decade, Commerzbank was involved in laundering hundreds of billions of U.S. dollars out of

Iran Iran, officially the Islamic Republic of Iran, and also called Persia, is a country located in Western Asia. It is bordered by Iraq and Turkey to the west, by Azerbaijan and Armenia to the northwest, by the Caspian Sea and Turkmeni ...

Sudan Sudan ( or ; ar, السودان, as-Sūdān, officially the Republic of the Sudan ( ar, جمهورية السودان, link=no, Jumhūriyyat as-Sūdān), is a country in Northeast Africa. It shares borders with the Central African Republic t ...

and

Myanmar Myanmar, ; UK pronunciations: US pronunciations incl. . Note: Wikipedia's IPA conventions require indicating /r/ even in British English although only some British English speakers pronounce r at the end of syllables. As John Wells explai ...

, against

United States sanctions After the failure of the Embargo Act of 1807, the federal government of the United States took little interest in imposing embargoes and economic sanctions against foreign countries until the 20th century. United States trade policy was entir ...

. Commerzbank agreed to pay US$1.5 billion in fines and dismiss several employees for their role in laundering US$253 billion, and for helping the Japanese company Olympus Corporation orchestrate accounting fraud. The bank has been subject to several corruption investigations, paying US$1.5 billion in fines in 2015. In 2017, Frankfurt prosecutors, together with federal crime police and tax officials, conducted searches of Commerzbank offices as well as the flats of three suspects in Frankfurt and nearby Hanau. The police raid was about a "tax evasion probe in which several current and former managers are suspected of evading €40 million in taxes via dividend stripping, also known as "cum-ex" transactions". The investigation also extended to trades in 2008 at Dresdner Bank, which was taken over by Commerzbank in 2009. Commerzbank said "it proactively notified the authorities with the preliminary results of that investigation and is cooperating fully". In 2019, Cologne prosecutors again raided Commerzbank's Frankfurt headquarters as part of the criminal investigation. It was announced in July 2019 that Commerzbank was being investigated by the

European Central Bank The European Central Bank (ECB) is the prime component of the monetary Eurosystem and the European System of Central Banks (ESCB) as well as one of seven institutions of the European Union. It is one of the world's most important centra ...

and

BaFin The Federal Financial Supervisory Authority (german: Bundesanstalt für Finanzdienstleistungsaufsicht, Bundesanstalt für Finanzdienstleistungsaufsicht) better known by its abbreviation BaFin is the financial regulatory authority for Germany. I ...

for facilitating its subsidiary mBank's toxic financial product offering in

Poland Poland, officially the Republic of Poland, is a country in Central Europe. It is divided into 16 administrative provinces called voivodeships, covering an area of . Poland has a population of over 38 million and is the fifth-most populou ...

, as well as for the linked potential tax evasion resulting from Commerzbank's financing of mBank's CHF-linked toxic financial products.

References

External links

* * {{Authority control Companies formerly listed on the Tokyo Stock Exchange Companies listed on the Frankfurt Stock Exchange German brands Multinational companies headquartered in Germany Banks established in 1870 C C Banks under direct supervision of the European Central Bank German companies established in 1870 Companies in the MDAX