COMMERZBANK, Germany’s second largest bank, yesterday posted a surprise net loss of €720m (£617m) for the fourth quarter.
The lender said it booked an extraordinary depreciation on deferred tax accruals of €560m and charges of €185m related to the sale of its Ukrainian Bank Forum unit.
According to StarMine, analysts had on average expected a net loss of €295m.
The bank further said it expects restructuring charges of approximately €500m in the first quarter of 2013 in connection with the reduction of 4,000 to 6,000 jobs until 2016.
“The negative trend of earnings disappointments continues,” DZ Bank analyst Christoph Bast said, adding the large amount of writedowns was a surprise.
In November Commerzbank lowered its 2016 return on equity target to roughly eight per cent at group level, setting a goal below the industry’s average cost of capital of 10-12 per cent.
As a result the bank is now unable to make full use of losses carried forward to reduce its tax bill and had to write down €560m on deferred tax assets for the fourth quarter.
City A.M. Reporter