Commerzbank AG

The German Government's Financial Markets Stabilization Fund (SoFFin), Allianz and Commerzbank intend to strengthen the equity of Dresdner Bank and Commerzbank. The planned capital measures will increase the new Commerzbank's core capital ratio (Tier 1, HGB) to approximately 10%. Against the background of the intensified financial crisis, the new bank will thus be enabled to meet the substantially higher capital requirements for banks. 'We are weatherproofing our bank for an economically stormy environment. This will enable us to fulfill our responsibility to offer loans to the German economy and to ensure we will continue to be a reliable partner for our clients,' said Martin Blessing, Chairman of the Commerzbank Board of Managing Directors.

SoFFin intends to provide additional equity totalling EUR 10 billion to the new Commerzbank. This will be realized by issuing roughly 295 millionordinary shares, plus a silent participation of approximately EUR 8.2 billion. A price of EUR 6 per share has been agreed. After the transaction, the Federal Government will hold a stake of 25 % plus one share in the new Commerzbank. The terms of the silent participation are similar to those offered to Commerzbank in December. The Federal Government is clarifying all further details with the EU Commission.

With the completion of the takeover, it is also intended that Allianz will boost Dresdner Bank's capital by EUR 1.45 billion by transferring collateralized debt obligations (CDOs) to Allianz with a nominal value of EUR 2 billion at a purchase price of EUR 1.1 billion. For the new Commerzbank, this will lead to a reduction in RWAs of EUR 17.5 billion and therewith a release of capital of EUR 700 million according to Basel II. Furthermore Allianz will subscribe for a silent participation of EUR 750 million.

The closing of the Dresdner Bank acquisition is therefore near completion. The planned measures are subject to the approval by the appropriate Boards.