RBC: Commerzbank Potentially Close to Merger with UniCredit's German Unit

09:47 AM EDT, 10/02/2026 (MT Newswires) -- Commerzbank (CBK.F) could be closer than previously expected to a potential merger with UniCredit's (UCG.MI) HypoVereinsbank subsidiary in Germany, RBC Capital Markets wrote in a Friday note. "At first sight, this 'win-win' transaction leaves us wondering if it is all too good to be true. UCG's earnings visibility would inevitably deteriorate further under this scenario, which is unlikely to help close the bank's existing valuation discount to the SX7E. Nevertheless, limited upfront capital consumption, potential earnings accretion of c.4% by FY30E, and attractive ROIs justify a more thorough assessment of this option," the research firm said. "Assuming an all-share combination, we derive a fair market value for HVB of c.EUR22-28bn, implying c.2.4x FY28E P/TBV or c.10x FY28E P/E at the mid-point. At that value, UCG's stake in CBK would increase from c.50% today to up to c.70%. The analysis comes after initial discussions held between the Italian banking group and the German government in early September. Reuters also recently reported commentary from Commerzbank Chief Executive Officer Bettina Orlopp regarding the possibility of purchasing UniCredit's shares in HypoVereinsbank as one of the deal structure options for a Commerzbank-UniCredit merger. Taking these into account, RBC made adjustments to its forecasts for UniCredit, including lower total revenue for 2026 and higher net interest income for 2028 through 2030. UniCredit's stock is rated sector perform, with a price target of 90 euros.