Deutsche’s deal with Commerzbank a sign of sector’s weakness | Larry Elliott

Merger plan comes amid problems that find many European banks in a zombie-like state

The proposed merger between Deutsche Bank and Commerzbank is far from a done deal. Politicians in Berlin might be supporting the tie-up, but there are plenty of critics – from unions fearful of tens of thousands of job losses to shareholders worried about the impact on already depressed share prices.

Clearly, this is not an ideal moment for Deutsche to be considering swallowing up its smaller rival. It will take up valuable management time and involve booking a hefty loss on the Italian and Spanish bonds sitting on Commerzbank’s books.

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