Christian Sewing, the chief executive of Deutsche Bank, believes there is a strong case for a merger with rival Commerzbank, according to a person with direct knowledge of his thinking.
Sewing's stance ahead of today's meeting of the supervisory board of Germany's largest bank sets the stage for a showdown with unions fearing massive job cuts.
Sewing sees multiple benefits of a merger, including "clear" dominance in its home market, scale, and shared technology costs, the person said.
Deutsche's CEO also believes that a combined entity would improve the cost of funding, with "the best funding ever", the person said.
Jobs would be cut with or without a merger, the person said.
Deutsche Bank and Commerzbank declined to comment.
The position marks a shift in Sewing's position.
In past months, he has urged patience, preferring to focus on internal restructuring before taking on a big project, according to other people with knowledge of his thinking.
The comments also contrast with the neutral tone set in a letter to employees on Sunday after both Deutsche and Commerzbank confirmed talks.
Sewing said then that many factors could still prevent a merger.
Deutsche Bank would not have entered talks if the bank expected negotiations to fail, a second person with knowledge of Sewing's thinking said.