Germany's Commerzbank is closing in on a multi-year target of adding 1 million new retail customers to its client base, the head of that business said on Thursday.
"Reaching 1 million customers this year is thoroughly realistic," board member Michael Mandel told a media briefing, referring to the net new client target set for the 2012-2016 period.
The retail bank added 81,000 customers between January and April this year, bringing the total to 900,000 since December 2012. The bank currently has 11.9 million retail customers.
Assets under control rose by 55 billion euros ($61 billion) over the same period to 317 billion euros, compared with the multi-year target of more than 300 billion.
Mandel, who took charge of Commerzbank's retail operations after his predecessor Martin Zielke was promoted to chief executive in May, is revamping the lender's network of 1,050 branches as it moves toward a common IT platform that can reach clients through multiple channels.
Germany's second biggest lender expects to invest 200 million euros in the platform, while keeping overall costs flat.
Commmerzbank warned investors in May to expect little from 2016 as it reported a steep drop in first-quarter earnings. Net income dropped by half to 163 million euros as volatile markets and low interest rates hit its business with German medium-sized companies particularly hard.
Commerzbank is wrestling with a brutally competitive and low margin retail market, but Mandel declined to say how many branches would remain in its network by 2020. Its network has shrunk by about 150 branches since 2012.
"The number of branches is not the cost driver and I think an across-the-board reduction is not sensible," Mandel said.
Deutsche Bank plans to shutter roughly 200 of its 700 branches and HVB has closed half its branches.
Mandel said Commerzbank aims to maintain its geographical presence and plans four types of retail branch in its revamp.
It expects to have between 65-100 "flagship" branches in large cities that will offer a full range of retail, commercial and wealth management banking services, after the concept did well in test markets Berlin and Stuttgart. Those branches cost around 1 million euros to set up.
It is also developing a smaller "city" outlet offering standard products, with a focus on new customers and service. The revamp will include a category of larger "classical" branches with cash handling and specialty advisors.