A different kind of poison pill
The rumours had been circulating for some time, and now it’s official. In an effort to counter UniCredit CEO Andrea Orcel’s ambitious return targets, Commerzbank is once again cutting thousands of jobs.
A total of 3,900 positions will be eliminated by the end of 2027, most of them in Germany. By 2028, the bank aims to reduce its cost-income ratio to a competitive 50% and achieve a return on equity of 15%. And the employee representatives? They fully support the new strategy, as Kevin Voß, the newly appointed Verdi representative on Commerzbank’s supervisory board, emphasises.
This strategic move appears to be driven less by business considerations and more by political maneuvering. Commerzbank CEO Bettina Orlopp has successfully won over the employee representatives, strengthening her position against the aggressor from Milan.
According to Verdi, the restructuring plans have already been approved by the relevant committees – something UniCredit would need to accomplish if Orcel truly intends to push through a hostile takeover – despite some statements to the contrary.
A price for peace
Orlopp’s success is not a result of her previous experience as head of HR, nor of any supposedly „typically female“ social skills. The peace agreement secured at Commerzbank comes at a high price. The transformation deal signed off by the general works council rules out forced layoffs – no one will have to leave the bank against their will.
Commerzbank has budgeted a total of 700 million euros for severance packages, early retirement, and phased retirement arrangements to ease the transition for affected employees. Additionally, all staff members are to receive shares worth 500 euros to strengthen their ties to the bank.
These generous concessions to the workforce could come at the expense of shareholders, especially given the weak economic outlook, and Commerzbank’s planned expansion in Poland and Asia. In any case, the signed agreements with employee representatives create a reality that any strategic investor would have to accept. After Orlopp ruled out M&A activity as a defence strategy, Commerzbank has instead come up with a different kind of poison pill.
