Germany has set out three requirements that would have to be met if UniCredit were to take over Commerzbank, the first in-person talks on the matter between Finance Minister Lars Klingbeil and UniCredit chief executive Andrea Orcel.
The finance ministry said Commerzbank should stay listed on the stock market and retain its headquarters in Frankfurt.
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It is also required to keep providing finance to German mid-sized businesses both domestically and overseas.
The German state owns about 13% of Commerzbank.
The talks are the first occasion on which Berlin has publicly defined the terms it wants Orcel to satisfy in relation to a takeover of the country’s second-largest listed bank.
Orcel has openly pursued a transaction for two years, facing determined resistance from Commerzbank and from political figures.
The process moved forward after UniCredit obtained just under 50% of Commerzbank shares during a formal offer this summer.
“It’s no longer about a hostile takeover but about finding the best path for the two banks,” a German finance ministry spokesperson was quoted as saying by Bloomberg.
In June, federal authorities in Germany rejected UniCredit’s proposal to exchange shares for a holding in Commerzbank, restating their opposition to a transaction between the two lenders.
That decision was made by the interministerial steering committee of the Financial Market Stabilisation Fund, which is responsible for major decisions concerning the fund.
The government said the proposal was unacceptable on financial grounds because it did not provide an adequate premium over Commerzbank’s market price at the time.
In April, Orcel put forward a plan for Commerzbank, reducing its broad network of offices worldwide.
Under UniCredit’s plan, Commerzbank’s net profit is targeted to reach €5.1bn by 2028.
The proposal argues that Commerzbank should scale back non-core international business and concentrate instead on German SMEs, domestic households and its operations in Poland.
It also calls for reducing risk in international networks, alongside spending on AI, technology and staff re-skilling.
In May, Commerzbank said it would cut 3,000 jobs and set more demanding profit targets, as it sought to bolster its case for remaining independent while under takeover pressure from UniCredit.
