Commerzbank pumps €4 billion into Dresdner
AFP · 9 Mar 2009, 17:58
Published: 09 Mar 2009 17:58 GMT+01:00
The transfer will take place after Dresdner's 2008 financial statements have been finalised and come from Commerzbank's own funds, so no more outside capital would be needed, the spokesman said.
The German government has taken a stake of 25 percent plus one share in Commerzbank in exchange for more than 18 billion euros in fresh capital. Commerzbank needed the money as it struggled to finalise its purchase of Dresdner for a little more than €5 billion.
The capital transfer announced on Monday would ensure that Dresdner's capital ratio, the amount of cash it holds in relation to total assets, would be "substantially above four percent," the Commerzbank spokesman said.
Dresdner has suffered heavy losses in connection with the international financial crisis and the collapse of the US market for high-risk or subprime mortgages.
Following the takeover of Dresdner, the new Commerzbank would have a capital ratio of 10 percent, the spokesman said.