Commerzbank: Now the gamblers are getting in
Profit jumps by two thirds in the first half of the year
Commerzbank has been able to significantly increase its profits in the first half of 2023. Compared to the same period last year, earnings before taxes rose by two-thirds to 1.4 billion euros. The bank benefited, among other things, from rising interest rates and a strong performance in its core business with corporate customers.
Net interest income up by 40 percent
Net interest income, which is generated primarily from interest on loans, rose by a significant 40 percent to 2.4 billion euros. This was mainly due to the fact that the European Central Bank (ECB) has raised interest rates several times in recent months. As a result, Commerzbank was able to charge higher interest rates on its loans.
Provisions for credit losses reduced
Commerzbank was also able to reduce its provisions for credit losses. These are funds that the bank sets aside to cover potential loan defaults. In the first half of 2023, the provisions fell by 23 percent to 225 million euros. This shows that the bank's customers are currently in a good financial situation and that the risk of loan defaults is low.
Strong performance in corporate customer business
Commerzbank was particularly successful in the first half of the year in its core business with corporate customers. Here, the bank was able to increase its revenues by 7 percent to 2.9 billion euros. This was mainly due to increased demand for loans and advisory services.
Outlook for the full year confirmed
In view of the good business development in the first half of the year, Commerzbank confirmed its outlook for the full year 2023. The bank expects net interest income of around 5 billion euros and a cost-income ratio of around 60 percent.
Conclusion
Commerzbank has been able to significantly increase its profits in the first half of 2023. The bank benefited, among other things, from rising interest rates and a strong performance in its core business with corporate customers. Commerzbank confirmed its outlook for the full year 2023 in view of the good business development.
