Commerzbank to repay most of state loan after raising cash

7th June 2011, Comments 0 comments

Germany's second biggest bank, Commerzbank, on Tuesday announced a second successful cash-raising exercise, of 5.3 billion euros, enabling it to repay most of its state loans "ahead of schedule".

The bank said it was able to repay 14.3 billion euros ($21 billion) of a total 16.2 billion euros it got from the government in 2009 to survive the global financial crisis.

Most of the money was raised, since April, through the sale of shares, with the second tranche -- 2.43 billion shares on sale between May 24 and June 6 -- yielding 5.3 billion euros, the company said in a statement.

An earlier operation raised 5.7 billion euros.

"Today, we have finalised the capital measure announced in April 2011 as planned. This allows us to redeem the (state's) silent participations ahead of schedule and to a large extent," said the bank's chairman Martin Blessing.

He said this was made possible by "the operating profitability of the bank."

The bank was one of the biggest German casualties of the global financial crisis and the bailout left the state with a 25-percent stake.

© 2011 AFP

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