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The bank said that it was immediately halting the outsourcing plan, launched in 2017, after identifying risks to its technical implementation, without elaborating.
The associated costs come at a bad time for Commerzbank (DE:CBKG), Germany’s No. 2 lender, which is trying to turn over a new leaf under its new chief executive, Manfred Knof. It is shedding thousands of staff to get back on a path to profit.
Joerg Hessenmueller, the bank’s chief operating officer who is also responsible for technology, said in a statement that growth in trading volume would allow Commerzbank to conduct securities settlement profitably.
Commerzbank is assessing what went wrong and who should bear responsibility, a person with knowledge of the matter said.
“We aren’t in favour of punishing Hessenmueller for this,” said Stefan Wittmann, a supervisory board member who represents labour.
A bank spokesperson declined to make Hessenmueller available for comment.
Commerzbank said it had also separately set aside provisions “in the double-digit millions” euros as a result of the project’s abandonment.
HSBC declined to comment.
($1 = 0.8467 euros)
