REG-Commerzbank Aktiengesellschaft Commerzbank expects revenue burden in Poland

COMMERZBANK AGAnnouncement

15/07/2022 14:15

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   Commerzbank Aktiengesellschaft (CZB)
   Commerzbank expects revenue burden in Poland

   15-Jul-2022 / 15:06 CET/CEST
   Dissemination of a Regulatory Announcement, transmitted by EQS Group.
   The issuer is solely responsible for the content of this announcement.

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     • Negative one-off effect of €210m to €290m expected at mBank in third
       quarter due to legislation on “credit holidays” for private mortgages
     • Operating result of Commerzbank to be impacted by corresponding amount
     • Bettina Orlopp: “Thanks to the continued good development of our
       operating business, we still expect a net result of more than €1
       billion for the financial year. This is under the condition that there
       will be no further significant deterioration in the economic
       environment, for example due to further shortages in the gas supply.”

    

   Commerzbank still expects a net result of more than €1 billion for the
   financial year 2022 despite an expected revenue burden at its Polish
   subsidiary mBank. This outlook is under the condition that there will be
   no further significant deterioration in the economic environment and that
   no material additional provisions for the Swiss Franc loan portfolio at
   mBank will be necessary.

   mBank had previously announced that, in the third quarter of 2022, it
   expects to book negative revenues in the range of PLN 1.0 to PLN 1.4
   billion (currently approximately €210 million to €290 million) as a result
   of possible deferrals of interest and repayment of private real estate
   financing (“credit holidays”) introduced by new legislation. Commerzbank’s
   third quarter operating result is expected to be burdened by a
   corresponding amount, which will be booked as negative revenues
   predominantly in “Other net income from financial instruments”.

   The new legislation in Poland allows private borrowers to skip monthly
   payments for current mortgages loans up to eight times by the end of 2023.
   mBank expects that 60% to 80% of currently assumed eligible borrowers will
   make use of this option. Commerzbank will consider legal action against
   this unusual measure, which is granted to all borrowers regardless of
   their financial position.

   The “credit holidays” are part of the measures taken by the Polish
   Government to respond to the consequences of high inflation and rising
   interest rates. The Polish National Bank had recently raised the key
   interest rate to 6.50%. In the second quarter, Commerzbank already expects
   additional compulsory contributions of around €83 million at mBank for the
   Institutional Protection Scheme.

   “mBank is one of Europe’s most modern banks and a growth engine for our
   Group. Unfortunately, the new legislation in Poland causes considerable
   one-off burdens. However, thanks to the continued good development of our
   operating business, we still expect a net result of more than €1 billion
   for the financial year. This is under the condition that there will be no
   further significant deterioration in the economic environment, for example
   due to further shortages in the gas supply,” said Bettina Orlopp, Chief
   Financial Officer of Commerzbank.

    

   Press contact

   Erik Nebel  +49 69 136-44986

    
   About Commerzbank

   Commerzbank is the leading bank for the German Mittelstand and a strong
   partner for around 28,000 corporate client groups and around 11 million
   private and small-business customers in Germany. The Bank’s two Business
   Segments – Private and Small-Business Customers and Corporate Clients –
   offer a comprehensive portfolio of financial services. Commerzbank
   transacts approximately 30 per cent of Germany’s foreign trade and is
   present internationally in almost 40 countries in the corporate clients’
   business. The Bank focusses on the German Mittelstand, large corporates,
   and institutional clients. As part of its international business,
   Commerzbank supports clients with German connectivity and companies
   operating in selected future-oriented industries. Following the
   integration of Comdirect, private and small-business customers benefit
   from the services offered by one of Germany’s most advanced online banks
   combined with personal advisory support on site. Its Polish subsidiary
   mBank S.A. is an innovative digital bank that serves approximately 5.6
   million private and corporate customers, predominantly in Poland, but also
   in the Czech Republic and Slovakia. In 2021, Commerzbank generated gross
   revenues of some €8.5 billion with around 46,500 employees.

    

   Disclaimer

   This release contains forward-looking statements. Forward-looking
   statements are statements that are not historical facts. In this release,
   these statements concern inter alia the expected future business of

   Commerzbank, efficiency gains and expected synergies, expected growth
   prospects and other opportunities for an increase in value of Commerzbank
   as well as expected future financial results, restructuring costs and
   other financial developments and information. These forward-looking
   statements are based on the management’s current plans, expectations,
   estimates and projections. They are subject to a number of assumptions and
   involve known and unknown risks, uncertainties and other factors that may
   cause actual results and developments to differ materially from any future
   results and developments expressed or implied by such forward-looking
   statements. Such factors include the conditions in the financial markets
   in Germany, in Europe, in the USA and other regions from which Commerzbank
   derives a substantial portion of its revenues and in which Commerzbank
   holds a substantial portion of its assets, the development of asset prices
   and market volatility, especially due to the ongoing European debt crisis,
   potential defaults of borrowers or trading counterparties, the
   implementation of its strategic initiatives to improve its business model,
   the reliability of its risk management policies, procedures and methods,
   risks arising as a result of regulatory change and other risks.
   Forward-looking statements therefore speak only as of the date they are
   made. Commerzbank has no obligation to update or release any revisions to
   the forward-looking statements contained in this release to reflect events
   or circumstances after the date of this release.

    

    

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   ISIN:          DE000CBK1001
   Category Code: MSCU
   TIDM:          CZB
   LEI Code:      851WYGNLUQLFZBSYGB56
   Sequence No.:  175171
   EQS News ID:   1399251


    
   End of Announcement EQS News Service

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