Commerzbank is Leaving the First Stock Exchange
The Dax founding member has to leave the German leading index on 24 September and will then be replaced by the payment processor Wirecard, as Deutsche stock market announced on Wednesday. The decision had been signed for weeks.
With over 24 billion euros, Wirecard is worth more than twice as much as Commerzbank, which in the future will be listed in the MDAX sub-index. Deutsche Bank has also overtaken the company founded 19 years ago.
Wirecard from Aschheim near Munich, which has so far been listed in the technology index TecDax, benefits from the fact that more and more people are shopping online or paying at the supermarket checkout with their smartphones. The business is booming, the stock rushes from one record high to the next. Since the beginning of the year alone, the share price has more than doubled.
The Commerzbank, on the other hand, accuse experts of oversleeping the digitization trend, the earnings are under pressure due to fierce competition and low interest rates, thousands of jobs are being canceled. Since the beginning of the year, the share has lost a third, on the stock exchange Commerzbank is worth only about ten billion euros.
Commerzbank is losing its attention, especially among international investors, due to the decline in the leading index. Investment funds representing the Dax must sell Commerzbank shares and at the same time acquire Wirecard securities. Commerzbank CEO Martin Zielke was still stressed. “Of course it is not nice that we as a founding member have to leave the leading index, but nothing changes for our customers and our business,” explained Zielke. “At the moment it’s just that the market rates fintechs higher than traditional banks.” This development spurs on Commerzbank to drive the transition to becoming a digital technology company.
In the Dax, the financial sector will include Deutsche Bank as the classic money house, Allianz as the insurance group, Deutsche stock market as the exchange operator, Munich Re as the reinsurer, and Wirecard as the payment service provider.
In parallel with the decision on the future listing of the Dax, Deutsche stock market published the final composition of the reorganized indices below the Dax. Due to the biggest reform of the German stock market landscape for years, the minor value index MDax has been extended by ten to 60 and the small-value index SDax by 20 to 70 members. The technology index TecDax is downgraded to a secondary listing index for the technology stocks from Dax, MDax and SDax.
From the MDax descend the electronics chain Ceconomy, the automotive supplier Leoni, the forklift truck manufacturer Jungheinrich, the advertising and media company Ströer and the insurer Talanx. They belong to the SDax in the future.
These changes will take effect on 24th September. In addition, Deutsche Bank has to step down from the EuroStoxx50, the index for the most important stock market values of the Eurozone.