A “recession” is on the cards, according to Commerzbank CEO Manfred Knof.
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Germany Commerzbank said on Wednesday that net profit more than tripled in the third quarter, better than expected and helped by higher interest rates, as it presented a strategy update.
Net profit of 684 million euros ($730.72 million) in the quarter compared to a profit of 195 million euros a year earlier. Analysts on average expected a profit of 611 million euros, according to a consensus forecast published by Commerzbank.
Like many banks, Commerzbank benefits from rising interest rates and the resulting income. Net income rose 34% to 2.2 billion euros, better than expected for 2.1 billion euros.
Commerzbank, one of Germany’s best-known banks that was partially held by the government after a bailout more than a decade ago, has spent much of the past three years in a major overhaul , cutting down on its staff and branch network to bring back profits.
On Wednesday, management provided a strategy update, saying it would reduce its cost-to-income ratio to 55% by 2027 and target a net profit of around 3.4 billion euros in that year.
These compare to a ratio of 60% so far this year and an expected profit of 2.2 billion euros for the full year.
“With our refined strategy, we are strengthening our position as a decisive player in the German banking market,” said CEO Manfred Knof.
