Commerzbank AG fell the most in six weeks in Frankfurt trading after Manager Magazin said Germany’s second-biggest bank planned to sell shares to increase its capital by as much as 10 percent.
Commerzbank fell as much as 5.3 percent to 1.367 euros, the biggest decline since Feb. 4. It dropped 3.2 percent to 1.398 euros at 5:16 p.m., valuing the company at 8.2 billion euros ($10.7 billion).
The bank hired UBS AG to help prepare the possible share sale, which could raise 700 million euros ($912 million) to 800 million euros, the magazine reported on its website citing people familiar with the matter who asked not to be identified.
Nils Happich, a spokesman for Commerzbank in Frankfurt, declined to comment on the report when contacted by telephone. A Frankfurt-based UBS spokeswoman declined to comment.
“Such a sale wouldn’t be good for the share price and wouldn’t be a smart move,” Ingo Frommen, an analyst with Landesbank Baden-Wuerttemberg in Stuttgart who recommends investors hold Commerzbank shares, said in a telephone interview. “The stock would be sold at less than its value and you’d have to be in an emergency to do so.”
Commerzbank’s price-to-book ratio, a measure investors use to calculate a company’s value, is 0.37, less than half of the average 0.82 for companies traded on the 46-member Stoxx 600 Banks Index.