FRANKFURT - Commerzbank AG (OTC:CRZBY) has reported a significant increase in its net result for the financial year 2024, achieving a record €2.7 billion, marking an approximate 20% rise from the previous year's €2.22 billion. The bank attributed the robust financial performance to strong customer business, which led to a 6% revenue increase to €11.1 billion.
Net commission income surged by 7% to €3.6 billion, while net interest income remained at a high level of €8.3 billion. Despite a challenging economic environment, Commerzbank (ETR:CBKG) maintained a robust credit portfolio, with a risk result of minus €743 million, slightly higher than the previous year's minus €618 million.
The bank's cost-income ratio improved to 59%, bettering the initial target of 60%. Return on equity (RoTE) also saw a significant increase to 9.2%, exceeding the goal of at least 8%.
In light of these results, Commerzbank plans to propose a dividend of €0.65 per share at the Annual General Meeting, a substantial increase from the previous year's €0.35 per share. Additionally, the bank's Board of Managing Directors has authorized a share buyback program of up to €400 million, with the necessary approvals from the German Financial Agency and the European Central Bank already secured. The buyback is set to commence following the 2024 financial year report and is expected to be completed by mid-May 2025.
The total capital return to shareholders for the 2024 financial year is around €1.73 billion, which corresponds to a payout ratio of 71% of the net result after deduction of AT 1 coupons. Over the three years from 2022 to 2024, the total capital return amounts to €3.1 billion, surpassing the bank's original projections. The CET 1 ratio post capital return stands at 15.1%.
Commerzbank CEO Bettina Orlopp expressed satisfaction with the results, stating, "We have exceeded our capital return promise to our shareholders." She credited the bank's success to effective cost management and growth initiatives, which have led to an increase in net results. The CEO also conveyed optimism about the bank's future, highlighting plans to further enhance capital return in the coming years.
Further details regarding Commerzbank's financial performance in 2024 and its updated strategy will be presented on February 13, 2025, in Frankfurt. The financial figures for 2024 mentioned in this report are preliminary and unaudited.
This article is based on a press release statement from Commerzbank.
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