German unions warn about Commerzbank merger plan

The union leaders warned the leaders of Deutsche Bank that they would break the integration of Postbank, which it had bought almost ten years ago, if the merger with Commerzbank materialized.

Deutsche and Commerzbank launched official talks in March on an agreement that would create the second largest bank in the eurozone, with € 1.9 million in badets and more than 140,000 employees.

While the German Finance Ministry is in favor, badysts and most major shareholders are skeptical of an agreement that faces many obstacles and may be difficult to turn into a success. The workers' representatives make up half of the supervisory boards of the two banks and unanimously rejected the merger. A senior Deutsche Bank official told the Financial Times that he could not imagine a scenario in which the unions would agree.

At a meeting with Deutsche Deputy Director General, Karl von Rohr, and his chief banker, Frank Straub, last Friday, Frank Bsirske, boss of the Verdi union, and other senior workers' representatives threatened to end the ongoing negotiations with Postbank if the agreement with the Deutsche Commerzbank was concluded, announced to two people familiar with the discussions.

The largest German lender has so far spent more than € 3 billion on the integration of Postbank, which it acquired in successive stages between 2008 and 2010.

At the end of the week, Verdi will also begin limited walkouts in the Deutsche and Postbank branches. Formally, it is to claim a wage increase of 6% and better working conditions.

"But we can expect the threat of a merger to motivate employees to protest," said Jan Duscheck, another representative of Verdi, a member of Deutsche Bank's supervisory board.

Deutsche Bank declined to comment.

After abandoning Postbank's first costly and prolonged attempt at integration in 2015, Deutsche decided to split the retail bank and put it on sale, to go back on the decision made in 2017.

The current plan is to completely merge the retail banking activities of Postbank and Deutsche and to create a "bank for Germany" with a combined badet of € 275 billion and more than 20 million business customers. detail. Deutsche wants to reduce its annual costs by 900 million euros by 2022. The bank plans to spend 1.9 billion euros to do it.

Last year, Deutsche Bank completed the legal process of merging the two retail activities and appointed the unit management. However, less than a quarter of the annual cost savings involved have been achieved to date.

Discussions with the unions on how to merge the day-to-day activities of the two retail banks began in January. Deutsche hopes to complete the integration of the headquarters functions by mid-2019 and reach an agreement on operations and IT by the end of this year.

Deutsche has cut more than 5,000 its workforce in the German retail banking sector through natural attrition and voluntary layoffs. She intends to reach an agreement with the unions on 2,500 more job cuts this year.

At the end of 2017, he signed a legally binding commitment to refrain from involuntary dismissal until the middle of 2021 and proposed generous layoff programs.

A person informed of Deutsche's internal discussions told the Financial Times that the bank still hoped the calendar would stay on track. But a union boycott could force Deutsche Bank to abandon Postbank's integration again.

"The bank would more or less come back to square one," said a senior union official at the Financial Times.