(Bloomberg) — Commerzbank AG will have to wait longer than expected for tens of millions of euros in cost savings that it had hoped to reap from consolidating its information technology, creating yet another expense headwind for Chief Executive Officer Manfred Knof.
The lender has decided to push back the integration of online broker Comdirect, meaning it will have to keep about 80 employees and maintain the unit’s IT systems for longer than planned, people familiar with the matter said. The impact will be less than 50 million euros ($57 million), according to one person.
A spokeswoman for Commerzbank confirmed the delay of the Comdirect integration, which was first reported by Wirtschaftswoche. She said the lender stands by its cost targets for 2024.
The decision adds to a number of unexpected expenses that have piled up since Knof unveiled his restructuring strategy for Germany’s second-biggest listed bank in February last year. The Comdirect project was delayed to ensure the online broker doesn’t lose value as it’s merged into the less nimble parent company, the people said.
Commerzbank’s other unexpected cost headwinds include severance payments and a court verdict last year voiding some fee increases at Germany’s banks. The lender last year also took an impairment charge of 200 million euros on a scrapped IT project and said it will take a 436 million-euro charge in the fourth quarter to draw a line under litigation at its Polish subsidiary.
Commerzbank is scheduled to reported to fourth-quarter earnings on Thursday. It has guided for a small annual profit.
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