Commerzbank AGM Backs Dividend Hike and Buybacks as UniCredit Tightens Grip to 40.7%

Commerzbank shareholders overwhelmingly approve a 69% dividend increase to €1.10 and a new buyback mandate, supporting CEO Orlopp’s strategy as UniCredit’s voting stake reaches 40.7%.

Commerzbank’s annual shareholder meeting in Wiesbaden delivered a decisive vote of confidence in the lender’s stand-alone strategy, even as UniCredit’s creeping stake in the German bank hit a fresh milestone. Shareholders approved the proposed dividend with 99.88% support and handed management new ammunition for a share buyback, underlining the depth of opposition to a combination with the Italian giant.

The dividend for the 2025 financial year rises to €1.10 per share from €0.65, a 69% increase that translates into a total payout of roughly €2.7bn. The ex-dividend date landed on 21 May, with the cash set to reach investors on 26 May 2026. That technical adjustment sent the stock lower in the immediate aftermath — down 0.86% on Friday to €35.83 from the previous close of €36.14 — but the shares still trade 34.80% higher over twelve months, reflecting the market’s long-term optimism.

Under the hood, the share price decline is a pure dividend effect rather than a signal of waning confidence. The relative strength index hit 80.6 after the AGM, pointing to a short-term overbought condition, while the stock remains above key moving averages. At €35.83, it sits about 5% below the 52-week high of €37.75 — a gap that leaves room for upside if the earnings momentum holds.

That momentum got a fresh boost from chief executive Bettina Orlopp, who raised the bank’s net profit guidance for the current year to at least €3.4bn, up from a prior target of more than €3.2bn. The first quarter provided the evidence: operating earnings of €1.4bn. Orlopp’s “Momentum 2030” strategy aims to lift the return on tangible equity to 21% by the end of the decade, a target designed to show that independence can generate superior value.

Analysts are taking note. Barclays holds an “Overweight” rating with a €42 price target, seeing roughly 16% upside from current levels. Morgan Stanley and Citi both rate the stock “Hold”, with targets of €39.50 and €38 respectively, but have nudged their estimates higher in recent weeks. The revision trend — even from neutral houses — suggests a reassessment of Commerzbank’s earnings power rather than outright euphoria.

The board also secured a fresh authorization to buy back up to 10% of share capital, giving management extra firepower to return capital and potentially prop up the stock. The buyback mandate, combined with the dividend hike, forms the financial backbone of the bank’s defence against UniCredit.

Yet the Italian lender continues to turn up the heat. UniCredit now holds 40.7% of voting rights in Commerzbank, including a direct equity stake of nearly 30%, a level that would give it an effective majority at an extraordinary general meeting. The acceptance period for its offer runs until 3 July 2026, and Commerzbank’s management has advised shareholders to reject it, warning of integration risks and possible earnings dilution.

Behind the scenes, the takeover battle has already claimed a scalp. Former CEO Manfred Knof saw his variable compensation for 2024 slashed by 30% after failing to disclose a meeting with UniCredit chief Andrea Orcel last September. Supervisory board chairman Jens Weidmann confirmed the penalty at the AGM, calling it a clear breach of duty. Meanwhile, employees protested outside the Wiesbaden venue, voicing fears over job security.

The macroeconomic backdrop adds a layer of caution. The eurozone manufacturing PMI slipped to 47.5 in May, while the services sector contracted to 46.4, dragged by rising energy and input costs. That kind of headwind tests any bank’s resilience, but Commerzbank’s improved profitability — and the strong shareholder mandate it received — gives management a firmer footing to argue that its standalone path creates more value than a merger. The clock is ticking, however, and UniCredit’s next move could come at the next shareholder meeting if it decides to exercise its voting power openly.