ZFirst Commerzbank in 2018, then Lufthansa in 2020: in recent years, the Rhine-Main region has had to cope with two companies that are controlled from here being relegated – although Lufthansa has its legal headquarters in Cologne, the headquarters are still in Frankfurt. Since then, only five companies from Rhein-Main have been represented in the leading German index. Even the reform of the Dax 2021, when the index was expanded from 30 to 40 titles, has not changed anything, which has reduced the weight of local companies in the highest German stock exchange league.
On Friday, Deutsche Börse will announce who will be the successor to industrial gases manufacturer Linde, which will no longer be listed in Frankfurt but only in New York. This opens a door for Commerzbank that was closed until recently.
After all, since the reform, inclusion in the Dax has required two consecutive financial years with a positive operating result (Ebitda); but after this value was still negative in 2020, Commerzbank rushed this year to announce its figures for 2022 earlier than usual to signal to the stock exchange that it is ready for the Dax comeback.
Highest surplus in 15 years
“Commerzbank is back,” said Commerzbank CEO Manfred Knof at the official presentation of the key figures for 2022 this Thursday. At least he is not wrong, because the 1.4 billion euro surplus is the best result of the Frankfurt group for many years: A higher surplus was last seen in 2007 with more than 1.9 billion euros.
During this time, the group, based on Frankfurt’s Kaiserplatz, has put numerous crises and some restructuring measures behind it. In the meantime, after the takeover of Dresdner Bank in the financial crisis in 2008, the state saved the institute from going out with the help of taxpayers’ money and is still the largest single shareholder. A failed merger attempt with Deutsche Bank also caused unrest in the years after the financial crisis. In addition, there was the extensive dismantling of branches: Of the around 1000 branches before the pandemic, only 400 should remain at the end of this clear cut.
Return to the leading index expected
Experts and analysts are now firmly expecting Commerzbank to return to the leading index Dax, which was launched in 1988, on February 27th. The company thus returned to the circle of other corporations from Rhein-Main: Deutsche Bank, like Commerzbank, is a founding member of the leading index and has been there without interruption ever since; In addition, the two Bad Homburg companies Fresenius (since 2009) and Fresenius Medical Care (since 1999) belong to the Dax, as does Deutsche Börse itself (since 2002), which has its headquarters in Eschborn just outside Frankfurt, and the Darmstadt-based pharmaceutical group Merck (since 2007).
When the index was created in 1988, Linde, Hoechst, Degussa and Dresdner Bank were included in the barometer alongside Commerzbank and Deutsche Bank.
For Commerzbank, the comeback – it is the first Dax ascent of a regional company since the German stock exchange in 2002 – would end an abstinence that began in 2018, when the group was replaced by the up-and-coming scandal company Wirecard from Aschheim near Munich and so many one who saw the beginning of the end of established financial groups as having come.
Formative for Frankfurt’s self-image
Traditionally, people on the Main look proud of the Dax, after all the index has its home there and stands for Frankfurt’s self-image of being an important economic factor in Germany and Europe. And, of course, successful corporations significantly shape the image of an economic region. Anyone who can boast of being the home of numerous corporations from the first stock exchange league has better chances of settling new promising companies as an attractive location.
After the ups and downs of the past few years at Commerzbank, the house is now apparently ready for the Dax again after a painful restructuring. According to the will of the management, the presence there should not remain an episode: For 2023, at least, Knof has already stated that it is aiming for an even higher consolidated result than in 2022.
