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Berlin under pressure over Commerzbank stake
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German taxpayers would lose billions of euros if the state sold its stake in Commerzbank ahead of a possible merger with Deutsche Bank, a government document showed, highlighting the risks of government involvement in the sector.
Berlin owns 15.6 percent in Commerzbank after a bailout a decade ago, and lawmakers have called on Finance Minister Olaf Scholz to get rid of the stake to avoid future risks for the budget if Commerzbank should merge with its larger rival.
Deutsche and Commerzbank said last month that they were in talks to merge.
In an answer to a parliamentary request, the finance ministry said that the Commerzbank share price, or the price offered in any takeover deal, would have to be about 26 euros (US$29.20) to avoid a loss for the state.
Commerzbank shares are currently worth some 7 euros.
Lisa Paus, budget lawmaker of the opposition Greens, said the finance ministry’s answers showed that the government’s loss currently stands at 3.7 billion euros, although it is unrealized.
“The bailout of banks has cost German taxpayers enormous sums of money in the past. Whoever believes that this is over now, is horribly mistaken,” Paus said.
“If the next big crisis hits, Deutsche Bank could turn into the next billion-euros grave for German taxpayers’ money,” Paus said, adding that she was against the merger.
Asked if the government had any plans to sell its Commerzbank stake in case of a merger, finance ministry official Bettina Hagedorn said that the government would not participate in any speculation regarding the outcome of the still ongoing merger talks between both banks, according to the document.
Scholz and his deputy, Joerg Kukies, are widely seen as having pushed behind the scenes for a merger between Deutsche and Commerzbank. But since both banks announced their merger talks, Scholz has played down the government’s role. The government has been worried about Deutsche Bank, Germany’s largest lender, which has struggled to generate sustainable profits since the 2008 financial crisis.
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