Friday 8 August 2014

Commerzbank report Q2 2014


Commerzbank, Q2, 2014, front page

The share price for Commerzbank increased by well over 2% on the quarter report. Usually I am astonished by the market response which to a large extent comes from my own stupid ignorance of the markets expectations which will always have an effect on the day to day share price movements. What was then in the report to cause such a run to Commerzbank?


To read my previous summary then please click on Commerzbank report Q1 2014 and if you want to read the full report from Commerzbank Q2 then please use this link from which all the material has been extracted.

In the key figures they decided to push that the operating profit is flat compared to in 2013 and even though they made a reverse split they still end up with substantially less operating profit per share. They also did not bring in any restructuring payments in the first half year 2014 so the earning per share ended up being positive... for now...
The total assets in the bank has also increased and in comparison to 2013 their Tier 1 capital ratio is still low but it has improved slightly in comparison to Q1 this year.

Commerzbank, Q2, 2014, key figures

 More importantly is the income statement and here we see yet again horrible figures and their interest income is down with another -12%. Happily the costs decreased by -14% so there is still a positive total outcome. Most other figures are pretty flat compared to 2013. The trading has decreased a little so I guess not only I started to build up some cash or cash equivalents. Looking at the previous half year the big reason for the negative result was due to the money put aside for the restructuring and if I remember correctly there was some mentioning that it would last them 2014 out. So let us see how that works out and what will happen in 2015.

Income statement, Commerzbank, Q2, 2014

Conclusion: Commerzbank is still doing bad with decreased main business revenue and with increased risk as an attempt to leverage earnings. in the newspapers they speak of decreased risk and a smaller "bad bank" compared to Q1 2014 but that time horizon I care little for. Either way I will remain shareholder with the conviction that they sooner or later will start to be profitable again. To find out more about Commerzbank then please see the analysis of Commerzbank 2014.

 

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