Germany's fourth-biggest bank by assets, Commerzbank, has reported significantly improved figures for 2004. After suffering losses in the previous year, the bank said it was able to return to profit thanks to major improvements in its operating profit and a positive trend in returns on equity.
In the 2004 financial year, the Commerzbank Group raised its operating profit by 87% to E1,043 million. This translates into an operative return on equity of 10.2%. In the final quarter, it achieved a profit of E174 million thanks to a distinctly positive trading result, representing a clear recovery from its weak previous quarter, the company said.
Despite restructuring expenses of E132 million in the third quarter to cover the repositioning of investment banking, the bank boosted its pre-tax profit to E828 million – having posted a loss a year previously. After tax expenses, a consolidated net profit for the year of E393 million remained.
The company stated that its management board has proposed a dividend payment of E0.25 per share, with the remaining amount (E243 million) being allocated to retained earnings.
Klaus-Peter Muller, Commerzbank’s chairman, said of the figures: As promised at the start of the year, we significantly improved our operating profit in 2004 and have made good progress towards achieving higher returns on equity. We remain confident that we can achieve an after-tax return on equity of at least 8% in 2005. A good start in January confirms our expectations.