Mon Sep 1st, 2008 at 05:56:57 AM EST
Germany's second biggest bank by balance sheet total, Commerzbank, recently announced the purchase of Germany's third biggest bank, Dresdner Bank (Magnifico reported).
Trade unions are concerned, because of the planned loss of 9,000 jobs out of the 63,000 employees total, but you do expect that. What about the markets?
Amazingly, the reason seems to be: brokers apparently looked at the dirty laundry of the companies involved, rather than the size of the new financial goliath.
As SPIEGEL too points out, the value of the deal is an indication: €9.8 billion is a lot, but the present seller, insurance and financial services giant Allianz purchased Dresdner Bank in 2001 for €24 billion.
The bank's main problem: investment bank daughter Dresdner Kleinwort, which entered the toxic derivates market in the last minute before the crash, resulting in writedowns of €3 billion for Dresdner Bank. According to speculations, Dresdner Kleinwort is to be sold soon.