German banking major Commerzbank reported a loss of €277m for the first quarter of this year, owing to Covid-19 (coronavirus) crisis.
Compared to a positive result of €246m in the same quarter a year earlier, the operating loss was made due to €479m impact from the pandemic crisis.
The bank’s revenues were €1.85bn in the March quarter, decreasing from €2.16 in the corresponding quarter last year.
The fall in revenue was attributed to temporary valuation effects.
But, the bank recorded a development in client business with an increase in its net interest and commission income overall by 10% in a comparison with the year-earlier quarter.
The operating costs of the bank declined to €1.05bn, compared to €1.57bn in the January-March quarter last year, but there was a significantly higher bank levy due to the negative effect.
Commerzbank stated that if the negative effect of pandemic is taken away, it would have achieved an operating profit of €202m. But, despite the pandemic, the German bank reported its Common Equity Tier 1 ratio at 13.2%.
Segment-wise results of Commerzbank
The bank’s private and small-business customers (PSBC) segment reported a revenue increase of 10% to €1.32bn, compared to last year’s €1.2bn. Despite the restrictions caused by the pandemic, the segment acquired 142,000 new customers in Germany, especially from online.
The volume of mortgage lending had also gone up by 7% to €82.2bn and the volume in consumer finance business increased to €3.8bn from last year’s €3.7bn.
Under the corporate clients segment, the bank claims to have maintained stable level of revenues in the direct customer business for the period, despite the pandemic.
Commerzbank managing directors board chairman Martin Zielke said: “At this moment, we are experiencing historically unprecedented circumstances. The coronavirus pandemic is putting the world and our economic system under a severe strain.
“We have not seen a comparable crisis since World War II. The banks have a key role to play in overcoming this crisis by providing liquidity and thereby helping their customers to get through these difficult times.
“We accept this responsibility and we have already provided around €11 billion of additional liquidity. Our strong balance sheet and our robust liquidity and capital position place us in a good position to meet this challenge and help the German economy with full strength.”
Recently, the bank scrapped its previously announced sale process of its majority stake of 69.3% in mBank, a fully internet-based bank in Poland, owing to the prevailing coronavirus crisis.