Germany's second largest bank Commerzbank slid as much as 14% today after it said it will sell €2.5bn to repay the government and insurer Allianz amid a company restructure.
Shareholders in the bank will be asked to approve a reverse share split, reducing the number of shares from 5.83bn to 583m on 19 April. The move will enable current investors to purchase new shares at a minimum of €1.10, around 14% lower than the current share price of €1.28. Commerzbank is 25% government-owned after receiving an €18.2bn bailout in 2009, and is selling the shares as it seeks to strengthen capital. The bank is also closing its loss-making shipping and property arms and restructuring its consumer banking unit. The share price recovered in afternoon trading, but was s...
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