Germany promised a hands-off approach to Commerzbank on Friday after taking a 25 percent stake in the lender in the country''s first part-nationalisation of a bank since the Second World War. Berlin agreed on Thursday to inject 10 billion euros ($13.68 billion) in fresh capital to shore up Commerzbank as it acquires rival Dresdner Bank, taking a blocking minority stake in Germany''s second-biggest lender in exchange.
Finance Ministry spokesman Torsten Albig said there were no requests from other banks for the government to take stakes in them. The government would not remain a Commerzbank shareholder for a "lasting period of time", he added. The government will take two seats on Commerzbank''s supervisory board but promised restraint.
"It would be fatal and stupid for the government to influence the operational business," Albig told a regular government news conference. The government''s move to take the stake in Commerzbank underscored the risk of executing a major take-over during the financial crisis and prompted several brokers to downgrade their recommendations and price targets for the stock.
Both banks faced renewed writedowns in the fourth quarter, sources familiar with the situation told Reuters earlier this week, raising concerns their capital base could wear thin. To gain the 10 billion euros in government cash, Commerzbank will issue 295 million ordinary shares at an agreed price of 6 euros each.
The deal also includes a "silent" participation of 8.2 billion euros, which counts as capital but has no votes. The terms of the agreement, the prospect of subdued banking revenues ahead and merger-related restructuring would weigh on Commerzbank for some years to come, analysts said.