UniCredit boosts its stake in Commerzbank, applies to own up to 29.9% of the German bank

UniCredit announced on Monday it had increased its stake in German lender Commerzbank to around 21% and submitted a request to boost the holding to up to 29.9%.

The Italian bank acquired the additional Commerzbank shares through financial instruments, it said in a Monday statement. Earlier this month, UniCredit announced it had taken a 9% stake in Commerzbank, confirming that half of this shareholding was acquired from the German government.

“UniCredit believes that there is substantial value that can be unlocked within Commerzbank, either stand-alone or within UniCredit, for the benefit of Germany and the bank’s wider stakeholders. However, as was the case for UniCredit, such potential requires action for it to be crystalized,” the bank said on Monday.

Berlin has been a major shareholder of Commerzbank since it injected 18.2 billion euros ($20.2 billion) to rescue the lender during the 2008 financial crisis.

Shares of Commerzbank fell sharply in early trade Monday after the German government said at the weekend that it didn’t plan to sell any more shares in the country’s second-largest lender. Shares pared losses following news that UniCredit had increased its position and applied to acquire more.

Commerzbank shares were down 0.4% by 11:50 a.m. London time, while UniCredit shares fell 2.3%.

German government officials met last Friday to discuss the state’s shareholding in Commerzbank. They concluded that the bank is a “stable and profitable institute” and its “strategy is geared towards independence. The Federal government will accompany this until further notice by maintaining its shareholding,” the agency said in a Google-translated statement.

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