Commerzbank net profit down after Q4 loss

FRANKFURT: Commmerzbank, Germany’s second-biggest bank, said yesterday its full-year net profit tumbled to just 6.0 million euros in 2012 after heavy write downs pushed it into the red in the fourth quarter.
Commerzbank said in a statement it booked a full-year profit of 6.0 million euros ($ 8.2 million) for the whole of 2012, compared with 638 million euros a year earlier, after it ran up net loss of 720 million euros in the period from October-December alone.
“On the basis of preliminary, unaudited figures the Commerzbank expects a net loss of approximately 720 million euros for the fourth quarter of 2012,” the statement said.
The fourth-quarter loss included charges of 185 million euros from the sale of Ukrainian subsidiary Bank Forum announced last July, as well as 560 million euros in one-off write downs on deferred tax accruals, it explained.
For the whole year, Commerzbank booked a total 980 million euros in one-off charges.
However, underlying earnings, as measured by operating profit, increased to 1.2 billion euros in 2012 from 507 million euros, the bank added.
Revenues before loan loss provisions were virtually unchanged at 9.9 billion euros, while administrative expenses were cut to 7.0 billion euros from 7.992 billion euros.
Loan loss provisions rose to almost 1.7 billion euros in 2012 from 1.4 billion euros in 2011.
Commerzbank said it would publish detailed fourth-quarter and full-year 2012 earnings on February 15.
Investors appeared disappointed by the heavy loss and Commerzbank shares were the biggest losers on the Frankfurt stock exchange where they were showing a loss of 2.11 percent just after midday, while the overall DAX 30 blue-chip index was down 0.4 percent.
Last month, Commerzbank said it will axe 4,000-6,000 jobs — or more than one in 10 of its workforce — over the next three years as it tots up the toll from the financial and sovereign debt crisis.
In its latest statement, Commerzbank cautioned that restructuring charges of approximately 500 million euros were expected in the first quarter of 2013 in connection with these measures.