BERLIN, Sept. 25 (Xinhua) -- Deutsche Bank chief executive officer (CEO) Christian Sewing did not deny widespread rumors of a potential merger between his bank and German rival Commerzbank at an industrial conference here on Monday night.
While offering no outright denial of speculations that Deutsche Bank and Commerzbank could merge to create a new national champion, the CEO of the embattled lender emphasized that his top priority at the moment was to improve profitability.
The ability of Deutsche Bank to turn the page on a long list of legal issues in the wake of the 2007-2008 financial crisis, as well as several leadership reshuffles, now hinges on an improvement of its earning power.
"As long as this (enhanced) profitability is not achieved, we will not reach a higher market valuation," Sewing said, with view to a prolonged slump in the price of Deutsche Bank shares listed on the DAX stock exchange.
Given a steep fall in Deutsche Bank's market capitalization during recent years, the Frankfurt-based lender is no longer included in the list of Europe's 50 most valuable publicly-listed companies as of Sept. 24. So far this year, the company's valuation has already plunged by 30 percent.
Long-standing and related rumors of a looming merger of Deutsche Bank and Commerzbank, Germany's largest and fourth-largest lender respectively, were recently fueled again by comments made by finance minister Olaf Scholz.
Speaking in Frankfurt, Scholz highlighted perceived risks associated with the current fragmentation of the European banking industry. He said the continents banks were increasingly unable to compete with their U.S. counterparts on Wall Street.
German media reports cited insiders in the federal government who confirmed that Scholz' ministry was seriously weighing the benefits of a Deutsche Bank-Commerzbank fusion.