Germany Reportedly Open to Commerzbank, Deutsche Bank Tie-up

(Bloomberg) -- The German government is open to a merger between the country’s two biggest listed banks, a magazine report said Tuesday.

German Finance Minister Olaf Scholz “could envisage” a tie-up between Deutsche Bank AG and Commerzbank AG, Spiegel reported, without saying how it obtained the information. It said that Deutsche Bank Chief Executive Officer Christian Sewing and Commerzbank CEO Martin Zielke are also open to the idea. The government owns a 15.5 percent stake in Commerzbank.

Speculation about the two banks merging has been bubbling since Bloomberg News reported in June that Deutsche Bank Supervisory Board Chairman Paul Achleitner had discussed the idea with German government officials. The government has hinted it would support merger activity recently, with Scholz saying that Frankfurt should remain the headquarters for global banks if and when European banking consolidation occurs.

Zielke and Sewing have both repeatedly said that consolidation should happen, although they have been less clear on what their banks’ own roles should be in that process. Sewing said in June that the time is not ripe yet, at least as regards cross-border deals.

Representatives for Deutsche Bank and Commerzbank declined to comment. A spokeswoman for the finance ministry said that it doesn’t comment on business decisions by commercial companies.

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