Boss of Italy's UniCredit aiming at takeover of Germany's Commerzbank

Andrea Orcel, chief executive of Italy's UniCredit, expressed an interest in a complete takeover of Germany's Commerzbank, in remarks published on Monday in Germany's Handelsblatt financial daily.

"A merger of the two banks could lead to considerable added value for all stakeholders and create a much stronger competitor on the German banking market," Orcel said after UniCredit increased its stake in Commerzbank to some 9%.

Private customers could be better supported and Germany's mid-sized companies could be boosted with loans and offered more comprehensive service on international markets, he said.

There were few overlaps between the two banks, Orcel said, adding the banks complemented each other geographically and were well balanced with private and business customers. There were also opportunities for cutting costs in central functions in particular, he said.

"It is important for Commerzbank to boost its balance sheet and at the same time to become more profitable," he said. "The current management has made clear progress here, but in my opinion much more can still be done."

Orcel noted that the return on capital of UniCredit's German subsidiary Hypo-Vereinsbank (HVB) was twice that of Commerzbank and that its costs were well below those of Commerzbank.

The UniCredit head said he was not aiming to take a seat on Commerzbank's supervisory board but wanted rather to engage in "constructive dialogue" with the Commerzbank executive.

The German state took a large stake in Commerzbank following the 2008 global financial crisis. UniCredit subsequently acquired a stake of 4.5% as part of the German government's phased withdrawal. It has since increased its stake through purchases in the market.

A full takeover is set to face opposition from Germany's large Verdi services trade union, which fears job losses.