While Unicredit quietly consolidates its grip on Commerzbank, increasing its shareholding to 38%, the German federal government continues to oppose the operation without managing to build truly convincing arguments. This emerges from the editorial published by the Handelsblatt and signed by Michael Maisch, head of the financial editorial office of the German economic daily, which precisely scans Berlin’s contradictions in the face of an acquisition that seems increasingly difficult to stop.
RESISTANCE WITHOUT STRATEGY
For months, Commerzbank’s CEO, Bettina Orlopp, has been waging a solitary battle to preserve the institution’s independence. At her side, at least officially, is the federal government, the second largest shareholder of the Frankfurt bank.
Yesterday, Tuesday, June 16, the Berlin executive reiterated its concerns: an acquisition by Unicredit could make financing conditions less favorable for German companies and weaken Frankfurt as an international financial center. Understandable fears, notes Maisch, but “not sufficient to sustain a resistance that is proving increasingly fragile every day.”
THE HYPOCRISY OF THE CAPITAL MARKETS UNION
The Achilles’ heel of the government’s argument, according to the Handelsblatt analysis, lies in a “contradiction difficult to ignore.” Chancellor Friedrich Merz and Finance Minister Lars Klingbeil are promoters of completing the European Union of savings and investments, a “project that has been neglected for decades.” Yet this very project “necessarily presupposes the existence of large pan-European banks and therefore cross-border mergers.”
Opposing Unicredit’s entry into Commerzbank’s capital while at the same time pushing for a single capital market appears, as Maisch writes, “a bit hypocritical.”
THE THREE-PILLAR MODEL AND ITS CONSEQUENCES
The Handelsblatt then broadens the perspective, also recalling a critique published in another authoritative European daily, the Neue Zürcher Zeitung, another point of reference in the financial world.
Germany has chosen to maintain a banking system “structured, based on the three traditional pillars: Volksbanken, Sparkassen, and private banks.” A historically rooted structure, notes the Düsseldorf daily, but one that “compresses the growth and profit opportunities of the larger institutions, such as Commerzbank itself or Deutsche Bank, exposed to much fiercer internal competition compared to their European neighbors.”
Other European Union countries have taken different paths, the editorial continues: in Italy, a long and painful process of privatizations and mergers lasting over twenty years has reshaped the entire sector, “giving rise to two large dominant operators, Unicredit and Intesa Sanpaolo, alongside some medium-sized institutions.”
The governor of the Bank of Italy, Fabio Panetta, has recently assessed the Italian banking system as solid enough to face a new season of mergers, both domestically and internationally. The moral Maisch draws from this comparison is direct: if Germany believes that the three-pillar model is the most suitable answer for its decentralized economy, with its dense network of small and medium-sized enterprises, “it must also reckon with the prospect that soon only one large private bank may remain in the country.”
