German banking firm Commerzbank AG announced its decision to end the project for outsourcing securities settlement with financial service company HSBC Transaction Services GmbH because of “technical implementation risks and changed market conditions.”
According to Commerzbank, the transfer of positions to the systems of HSBC for the middle of 2021 will not be carried out. Already transferred master data and tax statements relating to securities business are to be returned to the bank by early 2022.
Due to this, Commerzbank is expecting an exceptional write-off of an estimated 200 million euros (approximately US$ 235 million) in the second quarter of 2021.
Commerzbank said that they will reduce complications in the aftermath of this transformation and will prioritize the modernization of their own system landscape.