- Bank said to prepare job cuts as part of larger restructuring
- Zielke said to brief supervisory board on his plans next week
Commerzbank AG is preparing to eliminate thousands of jobs as Chief Executive Officer Martin Zielke seeks to boost profitability at the German lender, according to a person with knowledge of the matter.
Commerzbank may reveal the changes next week when Zielke presents his plan to the supervisory board, said two people, asking not to be identified because the matter is private. Proposals include merging some corporate businesses with the investment bank, reducing the number of operating units and eliminating as many as 5,000 jobs, Germany’s Boersen-Zeitung reported. A spokesman for the Frankfurt-based lender declined to comment.
Zielke, 53, has been under pressure to reverse a slump in earnings that forced him to scale back full-year profit goals, hurt by negative interest rates and volatile markets. Germany’s second-largest lender has eliminated some 5,200 jobs under a program announced under previous CEO Martin Blessing designed to lower costs and resume dividend payments.
The bank, which employed about 50,000 staff at the end of June, last month forecast a drop in full-year profit after second-quarter net income slumped 32 percent. It said earlier this year that it will probably fail to reach its goals for return on equity, a measure of profitability, and costs as a share of revenue in 2016.
Commerzbank, which is still partly owned by the government, fell 0.4 percent to 6.29 euros at 3:08 p.m. in Frankfurt. The company has lost about 34 percent of its market value this year.