Commerzbank warns client caution, interest rates to hit 2016 earnings

FRANKFURT: Commerzbank warned its earnings would fall this year due to customer caution and the drag on its revenue of the European Central Bank’s negative interest rates. Tuesday’s outlook from Commerzbank was gloomier than its previous view that the economic environment was making it “more challenging” to match last year’s net profit of 1.06 billion euros ($1.2 billion, Dh4.4 billion) and shares in Germany’s second biggest bank were indicated 1.6 per cent lower in a flat market “The cut outlook was expected, but share price erosion should continue,” said one Frankfurt-based trader. Commerzbank said interest rates and persistent customer caution due to geopolitical uncertainties were hitting income, despite growth.