DGAP-News: Commerzbank plans to repay silent participations of SoFFin and Allianz in full - shareholding of Federal Republic expected to fall below 20 %
(firmenpresse) - DGAP-News: Commerzbank AG / Key word(s): Capital Increase
Commerzbank plans to repay silent participations of SoFFin and Allianz
in full - shareholding of Federal Republic expected to fall below 20 %
13.03.2013 / 11:10
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ISSUED AND MAY NOT BE DISTRIBUTED IN THE UNITED STATES OF AMERICA, CANADA,
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- Complete repayment of silent participations of SoFFin (EUR 1.6 bn) and
Allianz (EUR 750 m)
- Capital increase with subscription rights of EUR 2.5 bn; 10:1 share
consolidation
- Clear improvement in capital structure and ability to pay dividends
- Fully phased-in Basel 3 Common Equity Tier 1 ratio expected to increase
after transaction to 8.6 % (pro forma at year-end 2012), up from 7.6 %
at year-end 2012
- Blessing: 'With the complete repayment of the silent participation of
SoFFin, we are repaying ahead of schedule all components of the state
support over which we have influence.'
Commerzbank is planning an early repayment in full of the silent
participations of the Financial Market Stabilization Fund (SoFFin) of about
EUR 1.6 billion and Allianz of EUR 750 million by means of a combined cash
capital increase/capital increase through contributions in kind with
subscription rights in the amount of EUR 2.5 billion. The capital increase
is to be approved at the annual general meeting of Commerzbank, which is
being brought forward to April 19, 2013. After the completion of the
capital increase, SoFFin's shareholding in Commerzbank is expected to
decrease from 25 % plus one share to below 20 %. The regulatory capital
structure of Commerzbank will be considerably improved by this transaction.
The fully phased-in Basel 3 Common Equity Tier 1 ratio will increase as a
result of this the transaction from 7.6 % as of year-end 2012 to 8.6 % on a
pro forma basis as of that date.
'With the complete repayment of the silent participations of SoFFin we are
repaying ahead of schedule all components of the state support over which
we have influence. At the same time we are improving Commerzbank's fully
phased-in Basel 3 capital base on a sustainable basis and are enhancing
future dividend paying ability,' said Martin Blessing, Chairman of the
Board of Managing Directors of Commerzbank. 'The support of politicians and
the taxpayer was very important for us during the financial crisis. We
would once again like to take this opportunity to thank them for this
support. For us the repayment of the silent participations and the
reduction in the Federal Republic's stake marks the beginning of the end of
the Federal Republic's engagement in Commerzbank.'
Silent participations of SoFFin to be repaid in full
During the financial crisis, the Federal Republic supported Commerzbank
with silent participations totaling EUR 16.4 billion in two steps in 2008
and 2009. The Bank has already repaid EUR 14.3 billion of this amount in
2011 together with a one-time payment of EUR 1.03 billion. With the
announced repayment of the remaining EUR 1.6 billion, the silent
participations of the Federal Republic will be repaid in full. At the same
time SoFFin will receive a one-time payment of approximately EUR 60 million
to compensate for the early repayment.
In additionto the silent participations, the Federal Republic had also
acquired shares in Commerzbank, with the effect that its full exposure in
the Bank amounted to about EUR 18.2 billion. Following the announced
repayment in full of the silent participations, including debt servicing
costs and compensatory payments, a total of about EUR 14.5 billion, or
approximately 80 %, will already have been repaid. Commerzbank will then
have repaid all the elements of the state support over which it has
influence.
The announced repayment in full of the silent participations is also in
line with the coalition agreement of the Federal Republic, which states
that state support measures should be repaid swiftly following the end of
the crisis while safeguarding the interests of the taxpayer. With the
announced repayment, Commerzbank is now repaying the silent participations
more quickly than planned.
Commerzbank using favorable capital markets environment
Commerzbank is taking advantage of the currently attractive capital markets
environment for the early repayment of the silent participations and the
planned capital increase. The associated capital measures require the
approval of the annual general meeting of Commerzbank, the date of which
has been brought forward from May 22, 2013 to April 19, 2013.
The annual general meeting will be asked to resolve on a combined EUR 2.5
billion cash capital increase/ capital increase through contributions in
kind with subscription rights for the existing shareholders. The
subscription rights ensure that the existing shareholders are able to
maintain their stake in Commerzbank through the purchase of new shares.
Furthermore, the general meeting is to decide on a capital reduction
through the consolidation of shares in a ratio of 10:1. The consolidation
of shares will cause the number of shares outstanding prior to the capital
increase to decrease from 5.83 billion shares to 583 million shares. The
stock consolidation and subsequent capital reduction have no impact on the
amount of balance sheet equity capital of Commerzbank. They will, however,
reduce execution risk for the capital increase. The full agenda for the
annual general meeting, which also includes the terms of the proposed
resolutions on the capital measures, will be published on 18 March 2013.
Deutsche Bank, Citi and HSBC have, on customary market conditions, agreed
to underwrite the entire volume of the capital increase totalling EUR 2.5
billion.
The completion of the capital increase and the trading period for the
subscription rights are planned for the period from mid-May to early June
2013. The subscription price will be determined in mid-May with a customary
discount to the theoretical ex-rights price (TERP) on the day the
subscription ratio is set. The Board of Managing Directors of Commerzbank
will decide on the subscription ratio and the number of shares to be
issued, as well as further details of the capital increase, with the
consent of the Supervisory Board. The newly issued shares will have full
dividend rights as of January 1, 2013.
SoFFin intends to support the transaction by exercising its subscription
rights in full and, in proportion to its stake in Commerzbank, contributing
silent participations in the amount of approximately EUR 625 million for
shares. On behalf of SoFFin, the consortium of banks will, at the beginning
of the subscription period, place with investors approximately EUR 625
million worth of Commerzbank shares out of SoFFin's holdings. This is
intended to ensure that the sales proceeds correspond to the volume of the
silent participations used in exercising the subscription rights.
SoFFin will thereby participate in the capital increase without investing
new capital. SoFFin will be repaid the remaining volume of its silent
participation out of the proceeds of the cash capital increase. If, as
intended, the Commerzbank shares from SoFFin's holding are placed with
investors and the subscription rights of SoFFin are fully exercised,
SoFFin's shareholding following the transaction is expected to fall to
below20 %. SoFFin and Commerzbank intend to commit themselves not to sell
or issue any shares in the 180-day period following the execution of the
transaction.
Further improvement in capital base
Commerzbank has significantly improved its capital base in the last few
years through retained earnings and the reduction of risk-weighted assets,
as well as through capital measures. This has meant that the Bank surpassed
current regulatory requirements with a Core Tier 1 ratio (pursuant to Basel
2.5) of 12.0 % at year-end 2012. However, analysts and investors are
already anticipating to the full application of Basel 3, which is only
expected to become fully effective from 2019 onwards. Upon successful
completion of the transaction, including the planned repayment of the
silent participations and the associated capital increase, this fully
phased-in Basel 3 Common Equity Tier 1 ratio would increase from 7.6 % at
year-end 2012 to 8.6 % on a pro forma basis as of that date. 'The
improvement of our capital resources has the highest priority for us. In
this respect we are making major progress with this capital measure, with
the effect that we are already aiming to reach a fully phased-in Basel 3
Common Equity Tier 1 ratio of 9 % by the end of 2014. At the same time we
are enhancing Commerzbank's dividend payment ability in the future, thanks
to the complete repayment of the silent participations of SoFFin and
Allianz and the resulting reduction in debt servicing costs' said Chief
Financial Officer Stephan Engels.
Improvement in the ability to pay dividends
Commerzbank sees benefits for its shareholders in the early repayment of
the silent participations. With the resulting reduction of debt servicing
costs and the removal of the obligation to repay the silent participations
of SoFFin and Allianz, dividend payments may be possible at an earlier date
in the future. The capital increase with subscription rights also ensures
that existing shareholders are able to acquire new shares on a pro rata
basis, thus preserving their proportional interests and avoiding dilution.
Alternatively they also have the alternative of selling those subscription
rights which they do not wish to exercise and thus receiving financial
compensation for the resulting dilution.
Commerzbank offers shareholders 'settlement of fractional shares' in the
share consolidation
The number of outstanding Commerzbank shares will be reduced to one tenth
of the current level in the planned share consolidation, while the share
price is multiplied by ten. Thus, there is no economic change for
shareholders. For shareholders whose current number of shares is not
divisible by ten, Commerzbank is offering to evening-up fractional shares.
The shareholders can decide individually whether to buy or to sell
fractional shares. Commerzbank will pay the associated custody bank
commission. This shareholder-friendly solution should ensure that existing
shareholders are not burdened financially by the stock consolidation and
reduction in the number of shares.
*****
Press contact:
Richard Lips +49 69 136 22461
Armin Guhl +49 69 136 42764
Simon Steiner +49 69 136 46646
*****
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, Mittel-standsbank,
Corporates&Markets and Central&Eastern Europe, it offers its private
and corporate clients as well as institutional investors the banking and
capital market services they need. With some 1,200 branches Commerzbank has
one of the densest branch networks among German private banks. In total,
Commerzbank boasts nearly 15 million private customers, as well as 1
million business and corporate clients. In 2012, it generated revenues of
just under EUR 10 billion with approximately 56,000 employees on average.
*****
Disclaimer
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(Kaiserstraße 16 (Kaiserplatz), 60311 Frankfurt am Main) and on the website
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exclusively on the basis of the prospectus required to be approved by the
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AG does not intend to register any portion of the offering in the United
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statements are statements that are not historical facts. In this release,
these statements concern the expected future business of Commerzbank,
efficiency gains and expected synergies, expected growth prospects and
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elsewhere in Europe and other regions from which Commerzbank derives a
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as of the date they are made. Commerzbank has no obligation to periodically
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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(at)commerzbank.com
End of Corporate News
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Language: English
Company: Commerzbank AG
Kaiserplatz
60261 Frankfurt am Main
Germany
Phone: +49 (069) 136 20
Fax: -
E-mail: ir(at)commerzbank.com
Internet: www.commerzbank.de
ISIN: DE0008032004
WKN: 803200
Indices: DAX, CDAX, HDAX, PRIMEALL
Listed: Regulierter Markt in Berlin, Düsseldorf, Frankfurt (Prime
Standard), Hamburg, Hannover, München, Stuttgart;
Terminbörse EUREX; London, SIX
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203715 13.03.2013
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