DGAP-UK Regulatory Service: Commerzbank AG / Corporate
Action/Miscellaneous
Commerzbank's measure to improve its capital structure strengthens its
Core Tier 1 capital by EUR 781 m in the first half of 2012
05.03.2012 / 08:22
=--------------------------------------------------------------------
NOT FOR DISTRIBUTION IN THE UNITED STATES OF AMERICA OR TO U.S. PERSONS
Commerzbank's measure to improve its capital structure strengthens its Core
Tier 1 capital by EUR 776 m in the first half of 2012
- Hybrid capital instruments, subordinated debt securities and other
capital instruments with an aggregate principal amount of EUR 965 m are
being contributed as a contribution in kind to Commerzbank in exchange for
360,509,967 new shares issued from authorised capital
- Transaction expected to strengthen Core Tier 1 capital through 2017 by
post-tax approximately EUR 1.2 bn in total
- Result of the transaction demonstrates the offer's attractiveness for
investors, shareholders of Commerzbank benefit from significant positive
effects on the results in the next years
As part of its measure to improve its capital structure announced on
February 23, 2012, Commerzbank's Board of Managing Directors, with the
approval of the Supervisory Board, has decided to increase the Bank's
subscribed capital by approximately 7 % (equalling 360,509,967 shares) by
means of a contribution in kind of selected securities using the Bank's
authorised capital ('genehmigtes Kapital'). The selected securities to be
contributed to Commerzbank comprise hybrid capital instruments,
subordinated debt securities and other capital instruments issued by
Commerzbank and other companies with an aggregate principal amount of EUR
965 million. To enable an efficient acquisition of these capital
instruments, Goldman Sachs International ('Goldman Sachs') will
intermediate this transaction and acquire these securities as offeror from
qualified investors outside the United States for the purpose of exchange
against new Commerzbank shares. Joint Dealer Managers for this exchange
offer were Citigroup, Commerzbank, Goldman Sachs and HSBC.
As intermediary, Goldman Sachs will also subscribe for the total of
360,509,967 new Commerzbank shares to be issued for the exchange offer
against the contribution in kind of the acquired capital instruments to
Commerzbank and will transfer these shares to the respective holders
following registration of the capital increase in the commercial register
after consummation of the capital increase. Based on the average of the
daily volume weighted average price in XETRA during the period starting on
February 24 and ending on March 2, 2012, 3 p.m. (CET) the exchange will be
executed based on an arithmetically determined exchange price per newly
issued share of EUR 1.9128.
With this transaction Commerzbank has taken advantage of a favourable
market opportunity to further improve its capital structure. The
transaction will lead to a post-tax positive effect of EUR 87 million in
the consolidated results of Commerzbank pursuant to IFRS and will increase
the Core Tier 1 capital by EUR 776 million in the first half of 2012. In
addition, the transaction will have an aggregate positive effect of EUR 484
million on the pre-tax result of Commerzbank pursuant to IFRS through
December 31, 2017. This is due to reduced coupon payment obligations
(subject to the fulfilment of the conditions for coupon payments for the
respective capital instruments) on the remaining aggregate principal amount
of the capital instruments after the transaction and due to specific
effects under IFRS for certain securities accepted in the exchange. The
latter is due to the re-sulting adjustment of the purchase price allocation
of the assets and liabilities of the former Dresdner Bank which included
these securities. The transaction is therefore expected to strengthen the
Core Tier 1 capital through 2017 by post-tax approximately EUR 1.2 billion
in total.
With this once more successful transaction, Commerzbank has already
executed the third measure to improve its capital structure due to the
repurchase of hybrid and subordinated capital instruments in the past 13
months. On one side, the result of this transaction demonstrates the
offer's attractiveness for the participating investors and the high level
of confidence of the capital markets in the Bank. On the other side, the
shareholders of Commerzbank also benefit from the significant positive
effects on the results in the next years.
The German Financial Market Stabilisation Fund (SoFFin) will continue to
maintain its equity interest ratio in Commerzbank (25% plus one share) upon
completion of the transaction. For this purpose it has been agreed, that a
corresponding portion of the silent participation held by SoFFin will be
converted into 120,169,989 shares, using the conditional capital authorised
in the 2011 Annual General Meeting of shareholders.
Commerzbank will receive the following hybrid capital instruments,
subordinated debt securities and other capital instruments in the
respective amounts shown below after successful completion of the
transaction:
Description of the Securities / Issuer / ISIN / Number of Securities
Accepted / Aggregate Nominal Amount of Securities Accepted /
Exchange Ratio per Security Accepted* / Number of Exchange Shares Issued
in Exchange* / Aggregate Nominal Amount of Securities Remaining
Outstanding**
EUR 1,000,000,000 Noncumulative Trust Preferred Securities /
Commerzbank Capital Funding Trust I / DE000A0GPYR7 / 830 /
EUR 41,500,000 / 16,468 / 13,668,440 / EUR 148,050,000
GBP 800,000,000 Noncumulative Trust Preferred Securities / Commerzbank
Capital Funding Trust II / XS0248611047 / 450 /
GBP 22,500,000 / EUR 27,020,536*** / 19,148 / 8,616,600 / GBP
93,100,000
EUR 750,000,000 Dated Upper Tier 2 Securities / UT2 Funding PLC /
DE000A0GVS76 / 87,720 / EUR 87,720,000 / 431 / 37,807,320 /
EUR 662,280,000
EUR 1,000,000,000 Tier 1 Capital Securities / HT1 Funding GmbH /
DE000A0KAAA7 / 584,115 / EUR 584,115,000 / 371 / 216,706,665
/ EUR 415,885,000
EUR 600,000,000 Noncumulative Trust Preferred Securities / Eurohypo
Capital Funding Trust I / XS0169058012 / 187,838 / EUR
187,838,000 / 360 / 67,621,680 / EUR 118,587,000
EUR 1,250,000,000 Subordinated (Lower Tier II) Fixed to Floating Rate Notes
of 2006/2016 / Commerzbank / DE000CB0789 / 194 / EUR
9,700,000 / 21,434**** / 4,158,196**** / EUR 492,450,000
EUR 750,000,000 Subordinated (Lower Tier II) Fixed to Floating Rate Notes
of 2007/2017 / Commerzbank / DE000CB8AUX7 / 537 / EUR
26,850,000 / 22,218***** / 11,931,066***** / EUR 246,000,000
* No accrued interest on any Securities will be payable except on the lower
tier 2 instruments accepted.
** Means the respective liquidation preference amount or nominal amount, as
the case may be, of Securities currently outstanding and not held within
the Commerzbank group.
*** For the purpose of determining the number of Exchange Shares to be
delivered to Holders of Accepted Commerzbank II TPS, the Theoretical
Purchase Price of GBP 30,500 in respect of such Accepted Commerzbank II TPS
was converted into EUR at the foreign ex-change reference rate of 0.8327 as
at 2 March 2012, as published on the website of the European Central Bank
under http://www.ecb.int/stats/exchange/eurofxref/html/index.en.html.
**** Plus accrued interest in the amount of approximately EUR 269 per
accepted LT2 2016 Note.
****** Plus accrued interest in the amount of approximately EUR 745 per
accepted LT2 2017 Note.
The transaction leads to the following positive effects on the pre-tax
result of Commerzbank pursuant to IFRS in the period starting on July 1,
2012 until December 31, 2017:
Period / Positive effects on pre-tax result pursuant to IFRS due to the
reduction of interest expenses for the acquired capital instruments (due to
purchase price allocation for former Dresdner Bank and expected reduction
of coupon payments*)
H2 2012 / EUR 25 million
2013 / EUR 97 million
2014 / EUR 104 million
2015 / EUR111 million
2016 / EUR 111 million
2017 / EUR 36 million
aggregate / EUR 484 million
* Subject to the fulfilment of the conditions for coupon payments for the
respective capital instruments.
Press contact:
Simon Steiner +49 69 136 46646
Maximilian Bicker +49 69 136 28696
*****
About Commerzbank
Commerzbank is a leading bank for private and corporate customers in
Germany. With the segments Private Customers, Mittelstandsbank, Corporates
& Markets, Central & Eastern Europe as well as Asset Based Finance, the
Bank offers its customers an attractive product portfolio, and is a strong
partner for the export-oriented SME sector in Germany and worldwide. With a
future total of some 1,200 branches, Commerzbank has one of the densest
networks of branches among German private banks. It has around 60 sites in
52 countries and serves almost 15 million private clients as well as 1
million business and corporate clients worldwide. In 2011, it posted gross
revenues of almost EUR 10 billion with 58,160 employees.
*****
IMPORTANT NOTICE
This document does not constitute an offer of securities in any
jurisdiction where such offer would be unlawful.
In the European Economic Area, the exchange offers referred to herein were
made exclusively to 'qualified investors' within the meaning of Article
2(1)(e) of the Prospectus Directive. Qualified investors include (a) legal
entities that are authorized or regulated to operate in the financial
markets or, if not so authorized or regulated, whose corporate purpose is
solely to invest in securities; or (b) legal entities which have two or
more of (i) an average of at least 250 employees during the last financial
year; (ii) a total balance sheet of more than EUR 43,000,000; and (iii) an
annual net turnover of more than EUR 50,000,000 as shown in their last
(MORE TO FOLLOW) Dow Jones Newswires
March 05, 2012 02:22 ET (07:22 GMT)
© 2012 Dow Jones News
