Capital Group takes 5% of Commerzbank

GERMANY - US fund manager Capital Group has disclosed a 5.03% shareholding in Commerzbank, making it the German bank's second largest shareholder after Italian insurer Generali, which has 8.6%.

Under German securities law, an investor must disclose his or her shareholding in a listed company when that figure exceeds 5%.

A spokesman for Commerzbank in Frankfurt did not attach any significance to Capital's announcement. "Our free-float is around 90%, one of the biggest percentages for any Dax (blue-chip) company. We also are in the hands of numerous funds, so the announcement is not a surprise," he told IPE.

Capital Group also said that it pursued a "long-term investment policy".

Capital Group's shareholding represents around 33m shares in Commerzbank. The bank's share is currently trading at around €27, off a high of €34 in April but well above an historic low of around €5 in early 2003.

In the first half of 2006, Commerzbank, now Germany's second-largest bank after Deutsche, had operating profit of €1.66bn. Its return on equity after tax - a key measure of profitability - stood at almost 18% on June 30.

Based in California, Capital Group is one of the US' biggest asset managers for retail and institutional clients. It has more than €1trn under management and its product offering includes equity, fixed-income and balanced funds.

In a related development, Cominvest, Commerzbank's asset management arm, said that it, along with peer MEAG, was managing assets from a new insolvency fund for German insurers and pension funds.

IPE reported last Friday that Protektor, the administrator of the insolvency fund, had awarded MEAG with a €100m mandate. Assets from the insolvency fund are to grow to €500m by 2009.

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