Commerzbank posts strong 2024 results with higher profits and stable loan growth

Investing.com -- Commerzbank (ETR:CBKG) on Thursday reported strong results in 2024 on Thursday, with revenues reaching €11.1 billion, marking a 6.2% increase from the previous year. 

Despite facing a slight decline in net interest income, which fell 0.4% year-over-year to €8.3 billion, the bank posted growth in net commission income, which rose by 7.4% to €3.6 billion. 

This increase was primarily driven by heightened activity in securities trading and capital markets, with corporate clients contributing substantially to the uplift.

For consumer goods companies, Commerzbank’s loan and deposit activity is of particular interest. 

Loan volumes grew steadily across corporate client segments, particularly in international markets, where the bank continued to expand its green infrastructure financing. 

Deposit volumes also increased, particularly among corporate clients, reflecting a shift toward term and call deposits amid evolving interest rate conditions. 

Meanwhile, private and small-business customers maintained stable deposit levels, with a slight reduction in call deposits due to adjusted interest rates.

The bank’s profitability metrics showed marked improvement. Its cost-income ratio improved to 59%, down from 61% the previous year, reflecting both revenue growth and controlled cost increases of just 1.6%. 

Commerzbank’s net result surged 20.3% year-over-year to €2.7 billion, significantly exceeding expectations. Return on tangible equity (RoTE) reached 9.2%, comfortably above the 8% target.

Risk management remained strong, with a risk result of €743 million, an increase of 20.2% from the prior year but still within guidance. The Common Equity Tier 1 (CET1) ratio stood at 15.1%, providing a solid capital buffer. 

The bank also maintained a disciplined approach to provisions related to foreign exchange loan risks, particularly at its Polish subsidiary, mBank.

Commerzbank anticipates continued growth in commission income, forecasting another 7% increase in 2025. Net interest income (NII) may face headwinds due to interest rate fluctuations, but the bank plans to counteract this through loan growth and balance sheet optimization. 

With strong capital and a focus on sustainable finance, Commerzbank is well-placed to provide corporate clients, including those in consumer goods, with customized financial solutions and funding opportunities.