DGAP-Adhoc

Commerzbank: Board of Managing Directors presents strategy and financial objectives 2020 to the Supervisory Board

Commerzbank Aktiengesellschaft / Key word(s): Miscellaneous

29.09.2016 10:33

Disclosure of an inside information according to Article 17 MAR,
transmitted by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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In response to current market rumours, the Board of Managing Directors of
Commerzbank AG confirms that it has presented Commerzbank's draft strategic
and financial objectives until 2020 to the Supervisory Board for
consideration. No decision has yet been taken with regard to the
implementation of these objectives. The Board of Managing Directors will
decide tomorrow on the strategic objectives after discussions with the
Supervisory Board. The objectives presented are as follows:

By the end of 2020 Commerzbank will have sustainably increased its
profitability. As part of the "Commerzbank 4.0" strategy, it will
concentrate on its core businesses, digitalise 80% of relevant processes,
and thereby achieve significant efficiency gains. Its business will be
focused in two customer segments, "Private and Small Business Customers"
and "Corporate Clients". The Mittelstandsbank and Corporates & Markets
segments will be merged and trading activities in investment banking scaled
back. This will reduce earnings volatility and regulatory risk and will
free up capital to be invested in core client businesses.

In the context of the decision of the new strategy, goodwill and intangible
assets of both Corporates & Markets and Mittelstandsbank will be subjected
to an impairment test. This means that most probably around 700 million
euros would be written off in the third quarter of 2016. Consequently, the
net result would be negative in the third quarter. The write-offs do not
affect the Common Equity Tier 1 (CET 1) ratio. In terms of Operating
profit, Commerzbank is expecting revenues to be approximately the same as
in the second quarter. Loan loss provisions will be considerably higher
than in the first two quarters due to ongoing weakness in the shipping
markets. Despite the goodwill write-offs, Commerzbank is expecting a small
net profit for 2016 as a whole. The CET 1 ratio after full application of
Basel 3 will be higher in the third quarter of 2016 than in the previous
quarter. The Bank is expecting its Common Equity Tier 1 ratio to stand at
nearly 12% at the end of the year, provided no significant market
distortions occur.

Commerzbank is aiming for a net return on tangible equity (RoTE) of at