Expenses for group restructuring and depreciation for a halted major outsourcing project are a burden for Commerzbank.

The money house, whose largest shareholder is the German state, slipped back into the red after a profit at the beginning of the year in the second quarter.

However, the new Commerzbank boss Manfred Knof sees the bank as being fully on track in implementing its strategy.

Despite the high one-off effects and the restructuring costs, Commerzbank was able to keep its core capital ratio stable at 13.4 percent, emphasized CFO Bettina Orlopp.

The bottom line was that the bank generated a loss of 527 million euros from April to June, as the institute announced in Frankfurt on Wednesday.

Without the booked restructuring expenses of 511 million euros, the bank would have achieved an almost balanced group result, she emphasized.

New boss turns Commerzbank on its head

The operating result was 32 million euros.

Analysts had expected an operating result of 56 million euros and a consolidated loss of 504 million euros.

For the year as a whole, Commerzbank continues to expect a positive operating result.

Knof is currently turning the house upside down to bring it back to profitability.

240 branches in Germany are to be closed this year.

After the restructuring of the group has been completed, 450 of the 790 branches are to be left.

Around 10,000 jobs - every third in Germany - will be lost.

Whole departments are closed or outsourced.

The aim of the management is to reduce the total costs to 5.3 billion euros by the end of 2024.

That would be around 20 percent less than in 2020.

But the conversion also costs.

The cost situation is already tense, for example due to fee reimbursements to customers.

Now the bank had to write off around 200 million euros because the money house decided to stop outsourcing securities processing.

Things went better in the second quarter at the larger competitor Deutsche Bank.

The bottom line is that the Frankfurt-based company generated a profit of 692 million euros from April to June, after a loss of 77 million euros a year ago.

It was the fourth quarterly profit in a row.