Commerzbank, one of Germany’s most well-known banks, reported a nearly doubled net profit in the first quarter of 2021. The bank’s shares traded 7.3% lower at 0750 GMT, making it the worst performer on the DAX blue chip index. Finance chief Bettina Orlopp told analysts net interest income had probably peaked in the quarter and that further provisions for its mBank unit in Poland were possible.
Net profit rose to 580 million euros from 298 million a year earlier, topping the 481 million expected by analysts in a consensus forecast published by Commerzbank. The bank said it sees “upside potential” in net interest income this year, and raised its forecast to 7 billion euros ($7.7 billion) from 6.5 billion.
Commerzbank is in the middle of a major overhaul, cutting thousands of workers and hundreds of branches to save costs and lift profits. Last year, Commerzbank booked a second consecutive year of profit, and the bank rejoined the prestigious DAX index.
Chief Executive Officer Manfred Knof said, “Commerzbank is in good shape. Our transformation is making good progress and is increasingly paying off.” Despite the positive news, analysts have said that the bank is vulnerable to soaring inflation, a slower economy and potentially soured loans.