Commerzbank Pins Turnaround on Job Cuts and Higher Fees as UniCredit Circles

Commerzbank unveils May 8 strategic plan with job cuts, €4.2B profit target, and higher dividend to fend off UniCredit's takeover bid.

The battle for Commerzbank’s future is entering its most critical phase, with management set to unveil a sweeping strategic overhaul on May 8 that will test whether the lender can thrive on its own terms — or eventually fall into the hands of Italy’s UniCredit.

Chief executive Bettina Orlopp will use the day to present updated financial targets and a roadmap to 2030, seeking to convince investors that independence delivers better returns than a tie-up with the Milan-based bank. Central to the plan is a further reduction in headcount, though the precise scale remains under negotiation with labour representatives.

Job cuts with a human face

The fresh wave of redundancies builds on an existing framework agreed with employee representatives, including a reconciliation of interests and a social plan for the German operations. The bank intends to use part-time retirement, early retirement packages and severance agreements to manage the cuts as gently as possible.

In February 2025, Commerzbank already announced plans to eliminate roughly 3,900 full-time positions by 2028, predominantly in central functions and staff units. The overall headcount is expected to remain broadly stable globally, as new hires in other areas offset the reductions.

Works council chief Sascha Uebel has thrown his weight behind the independence strategy, arguing that going it alone would cost significantly fewer jobs than being absorbed into UniCredit’s corporate machinery.

Record profits and a bigger dividend

The financial targets are ambitious. Management is aiming for net profit of €4.2 billion by 2028, up from a record adjusted net result of €3 billion in 2025 — a gain of roughly 13 percent year-on-year. For 2026, the bank is targeting a cost-income ratio of around 54 percent, a marked improvement in efficiency.

Shareholders are in line for a generous payout. The annual general meeting in Wiesbaden on May 20 will vote on a dividend of €1.10 per share for 2025, nearly double the €0.65 paid the previous year. Combined with ongoing share buybacks, the bank is returning around €2.7 billion to investors — provided the AGM gives the green light. The dividend is scheduled for payment on May 26.

Market sends a message

The stock has been trading comfortably above the implied offer price of €30.80 per share embedded in UniCredit’s exchange ratio. At €35.23, the shares are roughly 14 percent above that level and have gained about 50 percent over the past twelve months, reflecting the takeover premium baked into the price. Analysts’ average price target stands at around €38.

UniCredit currently holds just under 27 percent of Commerzbank’s shares directly, with access to another 3 percent through financial instruments — bringing its total exposure to 29.99 percent. Crossing the 30 percent threshold would trigger a mandatory offer for all remaining shares. The Italian lender’s own shareholder meeting is scheduled for May 4 to approve the capital increase needed to proceed.

Regulator draws a line

The conflict has escalated on the regulatory front. Germany’s BaFin issued an order on April 24 prohibiting UniCredit from publishing social media advertisements that contained speculation about Commerzbank’s financial health. The regulator stated that “unobjective statements, the dissemination of misleading analyses and forecasts, as well as advertising that relies more on the suggestive power of statements than on their economic substance, are not permitted in takeover proceedings.” Non-compliance could result in a fine.

UniCredit responded through a spokesperson, insisting it had merely sought to communicate its “positive vision” for Commerzbank, and suggested that the German translation may have introduced ambiguity.

Who holds the cards?

The German government, which retains a roughly 12 percent stake, has publicly opposed the takeover — Chancellor Friedrich Merz has made that clear. But the decisive voice belongs to institutional investors, who control around 37 percent of Commerzbank’s shares. Their willingness to tender will ultimately determine the outcome.

A result from the takeover process is not expected before late June or July, with full regulatory clearance — according to UniCredit — unlikely before 2027. Until then, Commerzbank’s management must prove that its standalone plan can deliver the numbers that keep the predators at bay.