Commerzbank (CBCM)

Commerzbank is the second largest bank in Germany with its head offices in Frankfurt. Commerzbank had an unsuccessful foray into investment banking that ended in the winding up of their investment banking arm, Commerzbank securities - Commerzbank Corporates and Markets (CBCM). Recently they’ve rebuild their investment banking offering, largely as a result of their acquisition of Dresdner bank.

Among their services are financing, transaction management, investment management, foreign business advice, risk management and consulting. One of their selling points has been that they offer a large amount of information to their customers through a series of free publications. This is particularly strong in Germany.

The financing is organized into working capital finance and investment financing. Investment financing is for more long term lending. This includes leasing and long term loans.

Working capital finance includes credit guarantees and cash advances. The credit guarantees are offered to both creditor and lender and are available for various types of credit needs, including loans, custom bonds and supply and tender guarantees. They claim to offer one of the most convenient services through an online letter of guarantee offering. The cash advances are with both fixed and variable interest rates. Loan mechanisms include business overdrafts, factoring of money owed to the company or money market loans.

Transaction management is aimed to help the various treasury functions that firms have. This is done through offering up to the minute financial information on company cash flows through the use of proprietary technology. They also have cash pooling solutions that aim to get the best interest rates depending on the levels of liquidity that a company wants. They claim that it offers the advantages of better liquidity management, more advantageous interest rates, better conditions for borrowing for short-term liquidity and complete settlement. They also offer payment transfers including dealing with cash payments and electronic transfers. This service is only offered in Germany.

There are a range of services for companies doing foreign business. As well as foreign payment settlement through electronic settlement they run various payment guarantee schemes, currency services and foreign trade financing. The payment guarantee schemes include export and import credit, export guarantees and export and import collection. This means that a large amount of the uncertainty of importing or exporting products can be alleviated. The foreign trade financing are a couple of escrow type schemes where goods or money are kept by the bank and are only released if both sides agree. There are also currency services that use spot and forward deals to either guarantee a price in the domestic currency of the company or to lessen the exposure to currency movements.

Risk management also uses the futures markets to hedge the price of commodities, credit or currency. Derivatives can be standard, structured or hybrid.

There are a number of investment products that involve money market and capital market expertise. This is usually through using the trading desks to help clients raise or utilise funds. As well as money market accounts there are also time accounts that offer a good rate for high deposits.

Commerzbank (CBCM) has extensive asset management specialities both for individuals and pension funds. Asset management offerings include money market funds, retail managed funds (usually specialising in equities but also including a property fund), special funds that are available for larger institutional investors and a bespoke fund management service.