Commerzbank cuts 3,900 jobs amid new strategic goals

In Germany, Commerzbank announced on February 13, 2025, that it will lay off 3,900 full-time employees by the year 2028, predominantly in its home country. This decision comes alongside the introduction of new strategic targets that aim for enhanced profitability and operational efficiency. The CEO of Commerzbank, Bettina Orlopp, highlighted the commitment to manage the job reductions in a socially responsible manner, seeking to minimize the negative impact on employees during the restructuring process. Additionally, the bank anticipates substantial restructuring costs of approximately 700 million euros, equivalent to about 730.7 million dollars, in 2025. Despite these short-term costs, Commerzbank is targeting a net profit of 2.4 billion euros after incorporating these charges. In light of these developments, it has also revised its revenue targets upwards. The new goal for long-term revenues is set at 3.8 billion euros by 2027, an increase from previous projections of 3.6 billion euros. Furthermore, Commerzbank aims to raise its return on tangible equity rate to 13.6% from the previously stated 12.3%. Commerzbank's recent financial performance has been noteworthy, with a reported net profit increase of 20% to reach 2.68 billion euros in 2024. This positive outlook has facilitated plans for share repurchases amounting to 400 million euros and an increase in the dividend payout. Despite ongoing speculation regarding potential mergers, particularly with UniCredit, Commerzbank continues to assert its independence and has engaged in dialogue with its significant shareholder. UniCredit currently holds a notable stake in Commerzbank and has expressed interest in the bank's future direction. These announcements reflect the broader trends in the banking sector, where organizations are navigating the complexities of the market while striving to remain competitive amidst potential consolidation efforts. By implementing these strategic changes, Commerzbank aims to position itself for sustained growth, emphasizing its commitment to its workforce and shareholders alike.