ECB scepticism could threaten Deutsche-Commerzbank deal

Deutsche Bank’s mooted merger with Commerzbank could face opposition from the European Central Bank after the eurozone’s leading financial supervisor said he disliked the idea of national banking champions.

The German government has said it would support a merger of Deutsche and Commerzbank after the two lenders announced talks on 18 March.

Andrea Enria, who chairs the ECB’s Single Supervisory Mechanism, said bank mergers had to be viable rather than serving political ends.

“I do not particularly like the idea of national champions, of European champions,” Enria told the Financial Times. “Especially when you are a supervisor you should not promote any structural outcome.”

Enria made his comments before the German banks confirmed long-running rumours that they would consider a merger. He declined to comment on how his regulator might respond to a deal between the two lenders.

Local press have reported that Deutsche and Commerzbank have come under political pressure from Berlin to consider a tie-up. The German government owns 15.5% of Commerzbank, which could be vulnerable to a foreign takeover.

Enria, who took over as chief supervisor in January, said his regulator would ignore political motivations for mergers. “What is relevant for us is the deal which is put forward to us, and the only things we care about are the sustainability of the project,” he told the FT.

Banks must be strong and secure and the eurozone’s financial industry should be subject to competition, he added.

“You want to have a market which is open, so that if there are foreign banks, foreign investors, bringing their expertise, their capital, into your jurisdiction, that should be welcome,” Enria said.