Commerzbank Monkeyhammered On Insolvency Concerns

Tyler Durden's picture

A few months ago, we noted that according to SocGen, Commerzbank is Germany's second most undercapitalized bank... Right after Deutsche Bank. Today, the market appears to have figured this out. Following media reports that the bank is in desperate need to raise €5 billion to satisfy capitalization requirements, the stock has gotten pummeled and at last check was down just under 9%. And articles such as the aptly titled "Commerzbank Bankrupt Again" from MM News are not helping.

Commerzbank:

And the MM News, as always translate by Google with immaculate hilarity:

Commerbank bankrupt again?

 

Commerzbank takes financial circles that probably much more capital than previously thought. Since the money is in the stock market and hard to find is probably the only way out, only the nationalization. Price of the Commerzbank from crashes on the stock exchange.

 

Commerzbank bank's internal calculations are missing after around five billion euros, should exacerbate the European banking supervisors their demands again, as several people familiar with the numbers told the Reuters news agency.

 

Commerzbank is Germany's second largest bank. On the stock market the stock fell on heavy volume at all time lows. At the same time the rest of geamte financial sector in Europe has been affected.

 

Reuters: On the basis of the second quarter was partly nationalized the Commerzbank, the gap required for the hard core capital ratio of nine percent still estimated at 2.9 billion €. In the third quarter, it posted 700 million euros loss - how much this has increased the capital requirement is open. Also wants the European banking supervision EBA tighten the conditions for calculating the capital again, which would increase the gap with numerous banks. Germany and other countries do, however, still resistance.

 

Commerzbank declined to comment on the situation. But the financial institution have already been issued by the rating agency Fitch bad grades: According to Fitch, the Commerzbank may once again claim government assistance. The experts see the efforts of the bank, the more stringent capital requirements by mid-2012 to meet its own power with the help of austerity measures, critical, as is evident from a study published short. An economic downturn could make her a spanner in the works