Germany is planning to facilitate a merger between Deutsche Bank and Commerzbank, according to Focus magazine.
According to the report, the German finance ministry is considering various options to combine the two banking majors, both affected with plummeting share prices.
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However, the German finance ministry, Deutsche Bank and Commerzbank declined to comment on the report.
Deutsche Bank-Commerzbank merger: Options
Citing familiar sources, Focus reported that the German government may acquire majority stake in Deutsche Bank and then facilitate the merger between the two entities.
Other scenarios include Deutsche Bank raising funds to purchase Commerzbank or creating a holding company which will own both the banks, the report added.
Recently, there were various speculations on the possible Deutsche Bank-Commerzbank merger. However, it was repeatedly refuted by the Deutsche Bank’s top management.
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By GlobalDataDeutsche Bank has witnessed record dip in its share prices owing to two money laundering cases and failure to revive its businesses.
Recently, the Germany’s largest lender also got involved in the Danske Bank money-laundering case. Last month, the US investigators approached Deutsche Bank seeking transaction details it handled for Danske Bank’s Tallinn branch in Estonia.
Bloomberg reported that Deutsche Bank is also mulling to convert itself into a holding company. It will facilitate the merger or joint operations of specific business segments.
On the other hand, Commerzbank was bailed out by the government during the economic recession in the last decade. The Frankfurt-based bank also witnessed a 45% drop in its share prices this year, reported Reuters.
