Germany's Commerzbank has today posted its biggest profit in 15 years in 2023, a 55% increase from the previous year, as it benefited from higher interest rates, and the lender said it was aiming for another profit rise in 2024.
But the bank warned that the sluggish economy "will remain a challenge".
Commerzbannk said its full-year net profit was €2.224 billion, up from €1.435 billion a year earlier and ahead of expectations for €2.191 billion.
Commerzbank, one of Germany's best known banks and partially held by the government after a bailout more than a decade ago, spent much of the past three years in a major overhaul, slashing its workforce and branch network to restore profits.
"We will achieve a further increase in net profit for the current year," chief executive Manfred Knof said.
Like many banks, Commerzbank is benefiting from a rise in interest rates and the income that generates. Net interest income rose 8.5% in the fourth quarter to €2.126 billion, better than expectations for €2.081 billion.
As Germany goes through its biggest real estate crisis in decades, Commerzbank disclosed it had €9 billion in exposure to commercial property loans, of which around 4% was non-performing.
The bank said it would be cautious on such lending, with "strong restraint in the non-food retail sector".
For the fourth-quarter, net profit fell 16% but it was better than analysts had expected.
Net profit of €395m in the quarter compared with a profit of €472m a year earlier.
Analysts had on average expected profit of €361m, according to a consensus forecast published by Commerzbank.
