Traffic lights glow near a logo of Commerzbank at a branch in Cologne, Germany, March 16, 2026. REUTERS
MADRID/LONDON, Sept 4 (Reuters) – Germany’s tilt towards a deal with UniCredit’s CEO Andrea Orcel to take over Commerzbank, after years of his manoeuvring, could prompt other European nations and banks to warm to further banking consolidation.
Until now Germany has pushed back against a takeover of its third biggest bank by UniCredit, which it viewed as a hostile move. But German finance minister Lars Klingbeil’s invitation to meet Orcel, reported by Reuters last week, was the clearest sign yet the government was now willing to at least talk about a possible deal.
Germany’s resistance to a takeover weakened after the Italian lender in July reached a stake of just shy of 50%, which is sufficient to sway shareholder resolutions, including naming board members.
“The potential deal between UniCredit and Commerzbank creates the basis for a pan-European champion, so it’s undeniable that it would add pressure for peers to pursue further scale,” Antonio Reale, co-head of European banks at Bank of America, said.
Supporters of European bank consolidation say bigger banks would be better positioned to absorb rising technology and regulatory costs.
Policymakers in Brussels and at the European Central Bank have called for cross-border mergers, having long argued the region needs larger lenders capable of competing with U.S. rivals. JPMorgan (JPM.N), balone, the biggest U.S. bank by market capitalisation, is worth around Europe’s top five lenders combined, LSEG data shows. They include BNP Paribas, HSBC and Santander.
National governments in the EU have been more reluctant to encourage cross-border deals, so Germany’s apparent warming is significant, bankers and analysts say.
Reuters spoke with 11 bankers, analysts and economists. Several say Berlin’s willingness to sit down with UniCredit after months of opposition could also embolden other banks seeking more scale and could be used as a reference for future dealmaking.
Germany’s stance may prompt support for broader banking consolidation by Belgium, the Netherlands and the Nordic region for example, one investment banker said.
EUROPEAN PUSH FOR CONSOLIDATION
The European Commission has been pushing plans to deepen the EU’s single market of 450 million consumers in a bid to make it easier for companies to operate across the continent, including through a long-delayed banking union that bank executives have said is vital for cross-border dealmaking to make sense, but details of a union are still being debated.”In a way, banks were waiting for the completion of the banking union to go for more consolidation, but it seems like it’s the other way around,” Morningstar DBRS senior vice president Nicola de Caro said. “Maybe the experience on the ground will support the cause for more bank integration, so the two things will probably move in parallel at the end of the day,” De Caro said.
However, most experts cautioned that significant obstacles remain and that a Commerzbank/UniCredit tie-up has unique overlaps.
UniCredit already has a substantial presence in Germany through its HypoVereinsbank unit, allowing it to extract local synergies and potentially improve the performance of a bank that has historically lagged some peers.
Fernando de la Mora, global co-leader of financial services at consultant firm Alvarez & Marsal, said cross-border deals would only materialise where banks could demonstrate clear value creation and scale benefits. As Europe remains fragmented, banks often have very different platforms in each country so combinations may not lead to the ability to extract synergies, some of the bankers and analysts said. European governments also remain reluctant to relinquish influence over national banking systems especially as they would remain on the hook for bank failures, three of the experts said.
The European Commission has challenged Italy’s use of golden powers to vet strategic corporate takeovers. UniCredit blamed government intervention for abandoning its bid for Banco BPM.
European authorities also disputed Madrid’s attempts to hamper BBVA’s €16 billion ($18.6 billion) bid for Sabadell. The deal ultimately failed.
De la Mora said Berlin appeared increasingly convinced that UniCredit’s move was difficult to stop and therefore wanted a seat at the table to shape the outcome. But he added that governments would continue to defend local interests.
A UniCredit/Commerzbank merger would create a bank with more than €1.3 trillion ($1.5 trillion) in assets, smaller than the likes of BNP Paribas or HSBC. However, Bank of America’s Reale said it would offer a model for other banks to follow, although the risk of government intervention in deals remained.
“Recent evidence from BBVA/Sabadell and UniCredit/BPM remind us that even when it comes to domestic deals, regional/national interests can be a limitation,” he said.
Reporting by Jesus Aguado in Madrid and Amy-Jo Crowley in London. Additional reporting Elisa Martinuzzi. Editing by Anousha Sakoui and Susan Fenton
