German insurer Allianz mulling major banking merger: Report

Written by AFP | Updated: Mar 28 2008, 20:13pm hrs
The German insurance company Allianz is mulling the possibility of contributing its banking unit Dresdner Bank to a three-way merger that would include Commerzbank and Deutsche Postbank, a press report said on Friday.

The discussions are still at an early stage however, and negotiations are not currently underway, the Frankfurter Allgemeine Zeitung said, without naming its source. A combined bank would have clout similar to that of the biggest German bank, Deutsche Bank. Under a three-way set-up, Dresdner Bank would be transferred to Commerzbank as an asset and then the new institution would acquire Postbank, which is due to be sold in the next coming months, the report said.

Germany's fragmented banking sector is widely expected to be consolidated, but financial turbulence in the wake of the US subprime mortgage crisis has also demanded the attention of top bank directors.