German bank Commerzbank reported better-than-expected results for the first three months of 2025, EuroNews reported. Instead of the expected decline in net income, the bank's net result increased by 12% to €834 million.

The lender's revenues increased by 12% to €3.1 billion, while net interest income was slightly lower than last year, amounting to €2.07 billion at the end of the first quarter of 2025. Meanwhile, net commission income rose by 6% to €1 billion for the same period, thanks to strong securities business.

"We achieved our highest quarterly profit since 2011, which shows that we can grow even in difficult economic times," said Commerzbank CEO Bettina Orlop. "We are continuing to make progress with the implementation of our 'Momentum' strategy. We plan to return more capital to our shareholders in the coming years."

Commerzbank has completed a €1 billion share buyback program launched in November 2024 and is proposing a dividend of €0.65 per share, to be decided at the Annual General Meeting on May 15, 2025.

The better-than-expected results come at a time when the German bank is trying to fend off takeover attempts by Italian banking group UniCredit.

UniCredit recently acquired a large stake in Commerzbank, increasing its stake to 29.9%, just below the 30% threshold at which UniCredit is required to make a public offer to buy the entire bank.

In February, Commerzbank announced cost-cutting measures, including cutting about 10% of the bank's staff, to fend off any takeover bid from the Italian bank.

Representatives of the German bank's employees are also organizing a protest against a possible takeover, scheduled just hours before Commerzbank's annual general meeting on May 15.

Commerzbank confirmed its targets for the year

The German bank said it expects a higher net result of around €2.4 billion for the full year, after restructuring costs.

The bank set aside €40 million for restructuring costs in the first quarter for an early partial retirement program that the bank will offer later this year. This is part of the job cuts that the lender is currently negotiating with employee representative committees.

In addition, to maintain its profitability, Commerzbank will reduce its dependence on net interest income – the difference between what it earns from loans and what it pays on deposits – in an environment of falling interest rates.

Return on tangible capital improved to 11.1% from 10.5% in the first quarter of last year, which is seasonally strong. "We are on track to achieve our full-year target of around 9.6%," said Commerzbank CFO Carsten Schmidt. "At the same time, we are reducing our dependence on net interest income. We are confirming our forecast for 2025." |BGNES