Berlin Gives UniCredit a Pass as Stake in Commerzbank Hits 40.7%

Merz green lights UniCredit's Commerzbank bid; UniCredit holds 40.7% voting. AGM approves €1.10 dividend. Stock RSI above 80; Barclays overweight.

Friedrich Merz has no intention of blocking UniCredit’s creeping advance on Commerzbank, a political green light that leaves the Italian lender free to press its takeover campaign. The chancellor will neither veto the transaction nor increase the government’s 12.7% stake, according to media reports. Intervention from Berlin, officials fear, would almost certainly draw a competition complaint from the European Commission.

UniCredit, meanwhile, has tightened its grip further. The Milan-based bank now controls 40.7% of Commerzbank’s voting rights, with a direct equity stake of just under 30%. That voting block would translate into a de facto majority at the next annual general meeting, raising the pressure on management.

AGM Backs Stand-Alone Strategy Despite Rising Pressure

Shareholders gathering in Wiesbaden on 20 May handed the board a resounding mandate to stay the course. Every item on the agenda passed, including a dividend of €1.10 per share for the 2025 financial year — the ex-dividend date set for 21 May — and authorisation for further share buybacks. The payout, worth roughly €2.7 billion in total, forms the centrepiece of Commerzbank’s defence against the hostile approach.

Yet the mood on the ground was anything but celebratory. Employees protested outside the venue, voicing fears over job security. One supervisory board member publicly questioned UniCredit’s intentions, warning that a takeover would threaten the German workforce.

Knof Pay Cut Over Secret Orcel Meeting

In a separate development, the supervisory board delivered a sharp rebuke to former chief executive Manfred Knof. His variable compensation for 2024 was slashed by 30% after it emerged he had held an undeclared meeting with UniCredit boss Andrea Orcel in September 2024. Chairman Jens Weidmann confirmed the sanction at the AGM, describing the omission as a clear breach of duty.

Technicals Flash Overbought as Institutional Money Flows In

On the trading floor, investors are digesting the dividend adjustment. Commerzbank shares changed hands at €35.88 on Friday, a modest dip that analysts largely attribute to the technical effect of the payout. The stock’s underlying strength, however, remains intact. The Relative Strength Index sits above 80, signalling extreme buying momentum, while the Chaikin Money Flow — a gauge of institutional accumulation — has printed positive readings every day since mid-April.

Support lies at the 50-day moving average near €34. To the upside, the stock must first clear €37, a level that has acted as resistance. A decisive break above that threshold would open the path to the 52-week high of €38.40, a level the shares briefly touched earlier this year.

The combination of political non-interference and chart-based resilience paints a favourable picture near term. Barclays rates Commerzbank “Overweight” with a €42 price target, implying a 16% upside from current levels.

Macro Clouds Gather Over the Banking Sector

Not everything points higher. The eurozone’s economic backdrop is darkening. The manufacturing purchasing managers’ index slipped to 47.5 in May, while services — a critical revenue driver for retail banks — slumped to 46.4, deep in contraction territory. Rising energy and input costs are squeezing margins across the region, creating a headwind that Commerzbank will have to navigate even as it fights off UniCredit.

The question now is whether the Italian lender will press harder, perhaps seeking board seats or a direct approach at the next AGM. With Berlin unwilling to step in and the share register tilting decisively in UniCredit’s favour, the window for a negotiated settlement is narrowing fast.