It’s one of the whispered topics in the Frankfurt financial scene: If Commerzbank continues to develop so well, it was said approvingly, then it would soon be worth as much as Deutsche Bank on the stock exchange. In reality, the “Yellows” are still a few billion separate from the “Blues” in terms of market value. But while Commerzbank’s share price has increased since the beginning of the year and the financial institution even celebrated its return to the DAX, Deutsche Bank’s shares fell on balance.
At the beginning of October, the former problem child of the German banking market set off another fireworks display and increased the dividend for shareholders. The message: Commerzbank is back. CEO Manfred Knof, brought in as a restructuring manager two and a half years ago, has managed to turn things around. The gnarly manager is now even better received by the employees, spread his PR consultants. In the spring, colleagues lined up at a company party to take selfies with Knof and proudly share them on social networks.
“Mostly no culture of trust”
In fact, the mood among the workforce seems to have little to do with the external image. This emerges from the evaluation of an employee survey that is available to the SZ. The Handelsblatt first reported on it. What’s particularly striking is that many employees apparently don’t believe in the strategy. Despite significant improvements, only a minority are still convinced of the strategy. Around half, twice as many as in 2022, are optimistic about the future of the bank. However, this perception is obviously detached from the understanding of strategy, because this has stagnated at a low level since the measurements began.
Managers could understand the strategy better, but here too only a good 60 percent believed it would be successful. Although trust in top management has increased to 43 percent since the last survey, only 25 percent of those surveyed can understand board decisions. That’s quite a slap for the first management team.
What’s more: The majority of managers themselves did not experience a culture of trust, even if the value had improved significantly. Only half of the employees said they did not have to fear any negative consequences if they expressed their opinions. This also includes dealing with bad decisions. Commerzbank is also not perceived as an attractive employer. Around 40 percent would be willing to change employers if they received a comparable offer.
“The transformation to a digital bank is too slow”
And the willingness to recommend Commerzbank from a customer perspective has also been steadily decreasing since 2020. “Unfortunately, the transformation to a digital bank is – as far as the processes are concerned – too slow,” an employee is quoted as saying. For example, 2022 had a lot of customers have to wait a very long time for their tax certificates. Another employee said that although management communicated much better than before, decisions remained difficult to understand; for example, there were now fewer product specialists.
A spokesman for Commerzbank described the results of the employee survey as unsurprising. With a transformation of the magnitude and speed that Commerzbank has completed over the past two and a half years, “a differentiated picture” was to be expected. This is normal in major change processes. The timing of the survey in June also plays a role: Since early summer, the positive effects of changes in the branches and the advice center have been increasingly noticeable for customers and employees. So there’s no reason to worry, according to the official line.
However, exactly why the employees doubted the strategy remained unclear. Is it perhaps because the bank has not yet really become a technology provider, as Knof had announced? It continues to be a completely normal bank, accepts savings, offers checking accounts and grants loans to private and corporate customers. The “revamp” so far has essentially consisted of decisively cutting costs, closing branches and cutting jobs – some say too hastily.
Knof also owes the good figures primarily to the still comparatively robust economy and low loan defaults, but above all to the change in interest rates, for which his predecessors had waited in vain for a long time. It is currently bringing enormous risk-free additional income into the coffers of the major European banks, which they are only gradually passing on to customers, for example through higher overnight interest rates. However, this effect is temporary, which is why many are wondering how the bank will continue to grow in its core business. Or whether management can invest sufficiently in IT given the high dividends paid to shareholders.