The German lender says it may have to set aside as much as €1.5bn in 2020 for bad loans
The cut to the outlook was driven by a single provision that cost the bank €175m last quarter linked to WirecardThe headquarters of Germany's Commerzbank in Frankfurt, Germany. Picture: REUTERS/RALPH ORLOWSKI
“All in all, a good set of numbers,” Morgan Stanley analyst Izabel Dobreva wrote in a note. The estimate for loan-loss provisions, while raised, remains below the consensus for full-year, she said. The firm is among the lenders hit hardest by the collapse of Wirecard, which filed for insolvency after saying that €1.9bn previously reported as cash on its balance sheet did not exist. The payments company had a credit facility of €200m with Commerzbank, of which about 90% was drawn at the time of its undoing, Bloomberg has reported. ING Groep, ABN Amro and Landesbank Baden-Wuerttemberg, or LBBW, had a similar exposures.
As a first step, the bank said it plans to bring costs down this year, after earlier targeting a level in line with 2019's target.
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