We are the bank at the side of our corporate clients
The coronavirus crisis is posing significant public health concerns as a well as considerable strain on businesses in Europe and globally. This is creating severe near-term liquidity challenges and longer-term uncertainties.
Firmly at the side of the German Mittelstand
As one of Germany’s leading commercial banks for corporates, Commerzbank will continue to support its clients throughout this difficult time. This is especially relevant in terms of the financial support that has been made available to German corporates, as well as the current position for international corporates amid the outbreak.
Companies are better positioned
At Commerzbank, we believe that Germany’s small and medium-sized enterprises (SMEs) have done well to strengthen their balance sheets in recent years. Nonetheless, the economic consequences that have followed the country’s lockdown measures have posed serious challenges. The situation came with little warning and its impact continues to vary from sector to sector. Some travel-related businesses, transportation and leisure companies for instance, have seen revenue streams stop abruptly, whereas others, while experiencing reduced revenues, can largely continue to operate as before.
Complete liability assumption is no carte blanche
The German state acted remarkably swiftly in providing strong support to corporates and freelancers. The government immediately launched three enormous financial support programmes: the Stabilisation Fund for Large Corporates, the KfW Loan Programme for the Mittelstand, and the Direct Subsidy Programme for SMEs and Freelancers. A further loan programme for German SMEs and freelancers has since been launched – offering 100% state-funded, fast-track loans up to €800,000 with no risk assessment.
Proactive support helps ease the pain
As one of the largest lenders to Germany’s corporates, Commerzbank itself is playing its part. The bank’s current focus is on providing loans and support in bridging near-term liquidity shortfalls. In addition to the loans from the KfW programme, Commerzbank has established a dedicated Commerzbank Mittelstand loan facility of €700 million to support corporates with corona-related financing demand. It is fulfilling its role as a German “Hausbank” (principal bank) by administering and part-financing the packages available via the KfW-backed programmes.
The bank has also made available several additional measures for clients on a case-by-case basis. These include the extension of credit lines, the introduction of repayment holidays, near-term liquidity solutions serving as a bridge until KfW support has been cleared, as well as temporary suspensions of loan covenants.
Rapid help is the best help
Throughout the situation, Commerzbak has been aware that timely advice and promptly delivered financial support are absolutely critical. In response to this, Commerzbank significantly increased its internal capacity immediately after following the announcement of Germany’s lockdown measures. This was to ensure that the bank was fully equipped to manage the incoming enquiries. Commerzbank now has 100 specialists dedicated solely to processing KfW loans and has given additional training to around 700 corporate client advisors on the coronavirus-related state subsidies and other support available.
Experience and partnership pay off
Commerzbank experts already have extensive expertise and experience of such programmes. As a leading German bank for the Mittelstand (SME sector), it has cooperated with KfW and other development banks for many decades. The bank has also moved extremely quickly to streamline the online application process for clients seeking access to the KfW’s coronavirus-related programmes. Implementing these initiatives so rapidly required a Herculean effort across various teams: Corporate Clients and Risk Management, as well as back-office departments.
The bank at your side
As a leading financier of the Mittelstand (SME sector), as well as corporates across Europe and beyond, Commerzbank is fully committed to its clients. Through previous spells of uncertainty, the bank has been the trusted partner at the side of its clients, wherever and whenever needed. Things are no different today.
Naturally, Commerzbank needs to remain prudent. Not all the support offered is fully state-subsidised and remains subject to risk assessments. Nevertheless, many client relationships – both in Germany and internationally – span decades. Now, more than ever before, the bank needs to go to great lengths to guide its clients through the current situation as effectively as possible.
Commerzbank: At your side right now
It’s precisely in this critical situation that we can offer our expertise to our corporate clients: Take advantage of our global network, ask us for liquidity solutions and contact us if your supply chains come to a standstill. Your personal advisor can support you as your first point of contact.
In order to provide increased availability, we will make increased use of telephone, video and WebEx conferences to be there for you.
We have also taken the necessary precautionary measures to ensure that our worldwide business operations continue to run smoothly. We have distributed operationally critical teams to different locations in order to maintain the continuity of our services, even if COVID-19 continues to spread.
Further information
Emergency aid from the Swiss Federal Council: COVID-19 loans to businesses in Switzerland
Facts and assessments of the development of the capital markets can be found on our research webpage.