DGAP-News: Commerzbank AG / Key word(s): Miscellaneous
Commerzbank sells commercial real-estate financing portfolios in Spain
and Japan, as well as the non-performing loan portfolio in Portugal,
totalling EUR 5.1 bn
11.06.2014 / 13:52
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- Spanish commercial real-estate financing portfolio (CRE) and the
portfolio of non-performing loans in Portugal totalling EUR 4.4 bn sold
to a consortium comprising JP Morgan and Lone Star
- Japanese CRE portfolio in the amount of EUR 0.7 bn sold to Asia-focused
alternative investment manager PAG
- Transactions include the entire operational CRE activities in Spain and
Japan as well as transfer of employees to an affiliate of Lone Star
(Spain) and to PAG (Japan)
- Negative impact from sales on earnings in the segment Non-Core Assets
in the second quarter amounts to approximately EUR 100 m
- Transactions reduce CRE portfolio by a total of approximately 16 %
(portfolio as of the end of March 2014: EUR 32 bn) and the
non-performing loans nearly by one third (portfolio as of the end of
March 2014: EUR 5.1 bn)
- Significant improvement of the CRE risk profile: "higher risk cluster"
almost run down in full
Commerzbank has signed agreements on the sale of its CRE portfolios in
Spain and Japan including the relevant interest-rate hedging derivatives,
as well as the non-performing CRE loan portfolio in Portugal. The
transactions include commercial real-estate loans totalling EUR 5.1
billion. Thereof, the Bank classifies EUR 1.4 billion as non-performing
loans (Spain: EUR 1.1 billion, Portugal: EUR 0.3 billion). The sold
portfolios account for approximately 16 % of the remaining commercial
real-estate loans of EUR 32 billion still held by Commerzbank as of the end
of March 2014. The platform in Spain as well as in Japan, and thus also the
respective employees, are being transferred to an affiliate of Lone Star
(Spain) and to PAG (Japan). It was agreed to maintain confidentiality on
further details of the agreements.
The portfolio of CRE loans in Spain and the non-performing CRE loans in
Portugal with a total volume of EUR 4.4 billion are being sold to a
consortium comprising JP Morgan and Lone Star. The CRE perfoming book in
Portugal remains with Commerzbank.
In Japan the Bank has sold its subsidiary Commerz Japan Real Estate Finance
Corporation to PAG's Secured Capital REP V and Pacific Alliance Special
Situations funds. Thereby, the primarily subordinated loans held by this
subsidiary which are totalling EUR 0.7 billion are being transferred to the
buyer accordingly. They are classified by the Bank as higher risk cluster
loans. The portfolio will be managed by PAG's Tokyo-based Secured Capital
Investment Management.
The Bank expects that there will be a negative impact of approximately EUR
100 million on earnings in the Non-Core Assets segment in the second
quarter of 2014 as a result of the transactions. However, based on the
considerable reduction of EUR 3.2 billion in risk-weighted assets (RWA) the
transactions will lead to a total positive net capital effect of
approximately EUR 200 million. Overall the sales have a positive effect on
the core capital position of Commerzbank. Also the reduction targets will
be positively influenced by these transactions. The Bank will give an
update on the reduction targets in its financial statements for the second
quarter.
The risk profile of the CRE loan book has improved significantly with the
transactions. The portfolio of loans in the CRE segment which the Bank
classifies as "higher risk cluster" is being almost run down in full
following the sales. In addition, the volume of CRE non-performing loans is
being reduced by nearly a third as a result of the transactions (portfolio
as of the end of March 2014: EUR 5.1 billion).
"These transactions are further evidence that we remain committed to our
value-preserving run-down strategy. In Spain we were able to take full
advantage of the excellent market opportunity, thereby reducing
significantly the earnings impact through an auction process," said Sascha
Klaus, Divisional Board Member Non-Core Assets Commercial Real Estate.
"With the sale in Japan we have disposed of our only CRE portfolio composed
of subordinated loans. At the same time we have further reduced complexity,
as this was our last remaining CRE operation outside Europe."
*****
Press contact:
Martin Halusa +49 69 136-85331
Nils Happich +49 69 136-44986
*****
About Commerzbank
Commerzbank is a leading bank in Germany and Poland. It is also present
worldwide in all markets for its customers as a partner to the business
world. With the business areas Private Customers, Mittelstandsbank,
Corporates & Markets and Central & Eastern Europe, it offers its private
and corporate customers as well as institutional investors the banking and
capital market services they need. With approximately 1,200 branches
Commerzbank has one of the densest branch networks among German private
banks and is on its way to become a modern multichannel bank. In total,
Commerzbank boasts approximately 15 million private customers, as well as 1
million business and corporate customers. In 2013, it generated revenues of
more than EUR 9 billion with approximately 54,000 employees on average.
*****
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
Poland, elsewhere in Europe 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, potential defaults of borrowers or trading
counterparties, the implementation of its strategic initiatives to improve
its business model, particularly to reduce its public finance portfolio in
Private Customers, 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 periodically 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.
Contact:
Commerzbank AG
Group Communications
Tel.: +49 69 136 - 22830
mediarelations@commerzbank.com
End of Corporate News
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Language: English
Company: Commerzbank AG
Kaiserplatz
60311 Frankfurt am Main
Germany
Phone: +49 (069) 136 20
Fax: -
E-mail: ir@commerzbank.com
Internet: www.commerzbank.de
ISIN: DE000CBK1001
WKN: CBK100
Indices: DAX, CDAX, HDAX, PRIMEALL
Listed: Regulierter Markt in Berlin, Düsseldorf, Frankfurt (Prime
Standard), Hamburg, Hannover, München, Stuttgart;
Terminbörse EUREX; London, SIX
End of News DGAP News-Service
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273026 11.06.2014
DGAP-News: Commerzbank sells commercial real-estate financing portfolios in Spain and Japan, as well as the non-performing loan portfolio in Portugal, totalling EUR 5.1 bn
| Source: EQS Group AG