The fate of Commerzbank now seems sealed. This is, in summary, the reading that the Neue Zürcher Zeitung (Nzz) offers on the case that has been shaking European financial markets and the halls of German politics for months: the acquisition offensive launched by Unicredit towards Germany’s second-largest credit institution is approaching its natural conclusion, and any attempt to hinder its course appears, in the eyes of the Zurich daily, as understandable on an emotional level but ineffective on a practical level. The editorial, with an unequivocal title, urges the Berlin government to abandon obstructionism and take a step back.
A BATTLE ALREADY DECIDED
The Nzz leaves little doubt: time is running out for Commerzbank. Anything can still happen, even that for any reason Unicredit decides to stop its acquisition attempt started in September 2024. But the Italian institution has continued to buy shares relentlessly. In short, “there are increasing indications that the Frankfurt bank will lose its independence in the near future and, despite the fierce resistance of its management and the support of the German federal government, will be absorbed by the Italian banking group.”
In Frankfurt, management has so far shielded itself with government support to foster a precise image of the Italians: that of a ruthless buyer, interested in drying up relations with German SMEs and then disappearing. The Zurich newspaper – incidentally one of the main European financial centers along with London, Frankfurt, and Paris – however, does not agree, and recalls an inconvenient detail for those who support this thesis: Unicredit has been operating in Germany for more than twenty years, with the HypoVereinsbank of Munich acquired in 2005, and in all this time it has not abandoned the small and medium enterprises it now claims to care about. It is therefore difficult to build the figure of a hit-and-run predator on this.
The Swiss newspaper dismisses with similar coldness the argument of systemic risk, that is, the idea that a larger bank exposes taxpayers to greater dangers in case of crisis: true, replies the Nzz, but it is precisely for this reason that supervisory authorities and regulatory tools exist, certainly not to block mergers that are entirely legitimate within the European perimeter.
THE STRUCTURAL ROOTS OF GERMAN WEAKNESS
However, there is something deeper behind this story, and the Nzz is keen to underline it. The downsizing of German banks in international markets is not a novelty of these months. At the birth of the Dax, almost forty years ago, among the thirty companies in the index there were five from the credit sector. If Commerzbank were to be absorbed, only one would survive: Deutsche Bank. It is not bad luck, nor an unfavorable conjuncture, warns the Nzz, but the result of a structural characteristic of the German system: almost 40 percent of credit to companies passes through savings banks and public regional banks, a circuit wanted by politics and difficult to dismantle.
Of course, the model has its merits, concedes the editorialist: the rates applied to companies are on average slightly lower than elsewhere, and retail current accounts often cost nothing. But the flip side is a competitive pressure so high that for private banks earning well becomes almost structurally impossible. And those who do not earn enough sooner or later become an acquisition.
THE LIMITS OF POLITICAL INTERVENTION
The most biting passage of the editorial is reserved for Berlin. The Nzz struggles to understand how the government could have so openly embraced the reasons of Commerzbank’s management, to the point that the Ministry of Finance has effectively offered the bank arguments to use against its own shareholders to dissuade them from accepting the offer.
All this commitment, notes the newspaper, clashes with a rather uncomfortable reality: the residual state share of 12 percent, still publicly held after the 2008 bailouts, is not enough to stop much if Unicredit were to reach the majority of the capital. At that point, the block would no longer make sense, and Berlin would also have given up selling those shares at a profit, as would have been possible.
But the issue, for the Nzz, goes beyond tactical calculation: a government of the European Union cannot simply forbid a company from being acquired by a competitor from another member state. Trying to do so solves nothing in terms of the operation, and meanwhile sends a very bad signal to anyone considering investing in a financial center that presents itself as reliable and open. “The end of Commerzbank’s 155-year history would be deplorable,” concludes the authoritative Swiss newspaper, “but in a liberal economic order it would be a perfectly normal process.”
