Commerzbank to pass ECB stress tests
According to Exane BNP Paribas, investors should own Commerzbank AG especially after the second largest financial institution would be passing the latest test of its financial health from the European Central Bank. It had gained by more than 50% since end of July 2013.
With that growth, according Exane analyst Guillame Tiberghien, the bank still commands 'a sufficiently compelling' valuation. He wrote in his note to clients, "Improving odds of passing the test should allow the re-rating to continue."
The ECB assumed oversight of Europe's largest bank from national regulatory authorities to soften the effects of the Eurozone crisis in a bid to break the link between states and their lending institutions. Commerzbank was amongst those with unprofitable loans that were waiting to catch a glimpse on how tough the ECB would be in its determination of additional capital requirements for banks in order to easily pass during time of turbulent scenarios.
Commerzbank increased by as much as 1.5% to EUR9.877 per at the end of the Frankfurt trading session. It is also the highest intraday level since March.