Spain’s Banco Santander, S.A (NYSE:SAN) wants to speak German with Commerzbank
Die Welt the daily, reported that Banco Santander, S.A (NYSE:SAN), the Spanish bank is considering investing in Germany’s second-largest bank, Commerzbank. On Tuesday, the paper said there is a distinct possibility that Santander may be particularly interested in Commerzbank’s retail-banking business. This unit has over 11 million customers. Both, Commerzebank and Santander refused to comment on this report.
Major Financial shakeup
Following its 2009 bailout, the German government owns 17% of Commerzbank. This was at a point of time when Lehman Brothers crashed and a majority of prominent European banks were driven to the brink of closure. The financial shakeup had left Santander no option but to announce bankruptcy and the Government had to pitch in. Over the weekend, a certain German magazine had reported that Wolfgang Schaeuble, the Finance Minister has approached the UBS chairman about a possibility of them buying-out the remainder of the stake that the Government had, in Commerzbank.
Santander currently has several investments in Germany. In recent years, it had bought Skandinaviska Enskilda Banken’s retail business and General Electric Company’s GE Money Bank. At one point it had also shown interest in buying Deutshe Postbank which the Deutsche Bank now owns. However, Commerzbank’s books hold risks of billions of dollars. All of these are related to real estate loans and shipping. This in itself will make the sale of the bank a tough proposition to any potential buyers, including Banco Santander, S.A (NYSE:SAN)
About the bank
Banco Santander, S.A (NYSE:SAN) is a commercial bank based in Spain. It primarily operates in Spain, Portugal, the United Kingdom, the United States as well as the Latin American countries. It operates in four segments: the United Kingdom, Continental Europe, Sovereign and Latin America. The Continental Europe segment spans all the wholesale banking retail banking businesses. Amongst others, it conducts insurance and asset management services under the Santander Consumer Bank, Santander Totta, and Bank Zachodni WBK brand names.