FRANKFURT, Germany - Deutsche Bank on Sunday confirmed reports first published in The Wall Street Journal, and by Reuters, that it is in discussions with Commerzbank about a merger.
"In light of arising opportunities, the management board has decided to review strategic options,:" Deutsche Bank said in a statement published on Sunday.
"In doing so, the management board of Deutsche Bank is focused on improving the growth profile and profitability of the bank."
"There is no certainty that any transaction will occur," the Deutsche Bank statement said.
A merger of Germany's two biggest banks has been spoken about for the past 2 to 3 years, and is believed to be a preferred course for the German government which wants a strong bank. Deutsche Bank was weakened by the global financial crisis, and Commerzbank too has received government support, reflected in the 15% equity position the government now holds.
More insight into the strategy was revealed in a separate note to Deutsche Bank employees by CEO Christian Sewing on Sunday.
"Today we have informed the public that, in the context of reviewing strategic options, we are engaging in discussions with Commerzbank," he wrote.
"For months now, there have been permanent rumours regarding potential mergers. That is why it is personally important to me to provide you with some more context."
"You may recall that last September I said that, first and foremost, we intend to do our homework. In this regard, we have made a lot of progress over the last couple of months. This is something we can be proud of and that we can build on," Sewing said.
"At the same time, however, we have to assess opportunities as they arise. I have consistently stressed that consolidation in the German and European banking sector is an important topic for us. We have to assess how we want to play a part in shaping it. Our stated aim remains to be a global bank with a strong capital markets business – based on a leading position in our home market in Germany and in Europe, and with a global network. This is what our clients expect from us. What is also important to me is that we will only pursue options that make economic sense, building on the progress we made in 2018."
"That is why we, the Management Board, will review the options that present themselves to us carefully. It is our responsibility and it is our duty. In doing so, we will keep the interests of the bank and all of our stakeholders in mind. At this point in time, there is no certainty at all that any transaction will materialise. Experience has shown that there may be a lot of potential economic and technical factors that could hinder or prevent such a step," wrote the Deutsche Bank CEO in his note to employees.
"In the meantime, I would ask you to focus on your daily business and to be there for our clients. They count on us and their trust is our most precious asset. There is no better way for us to get positive recognition than by delivering great service to our clients."