In a surprising turn of events, the chief executive of Germany's Commerzbank, Manfred Knof, has firmly rejected the takeover proposal from Italy's UniCredit, expressing his determination to keep the bank independent. This comes after UniCredit recently acquired a 9% stake in Commerzbank, catching German government officials off guard.

Knof, addressing the media on Monday, stated that Commerzbank has its own plans for the future and remains convinced of their viability. He emphasized that the bank's management is fully committed to implementing their strategy with utmost energy and dedication. These remarks mark the first official response to speculations about a potential merger with the larger Italian lender.

UniCredit CEO Andrea Orcel had earlier expressed his belief that a merger between the two institutions could create a stronger and more valuable bank. However, Knof countered by highlighting that Commerzbank is already flourishing under its current course. He stressed the importance of a robust Commerzbank for Germany's financial standing and revealed that the bank's management has conveyed their stance to the German government, its largest shareholder.

Despite the firm stance on maintaining independence, Knof acknowledged that Commerzbank's management would consider any proposals put forth by UniCredit, in line with their obligations to stakeholders. As a crucial component of Germany's economy, serving more than 25,000 business customers and playing a significant role in foreign trade payments, Commerzbank holds a crucial position as the country's financial center.

UniCredit's unexpected acquisition of part of the government's stake in Commerzbank has irked German officials and raised concerns within the bank itself. Fears of potential job cuts have emerged among management and trade unions, prompting them to seek advice from bankers on how to defend against the bid.

These discussions about a potential takeover come at a delicate time for Germany, as the country's coalition government faces public discontent and prepares for national elections in the coming year. With the rise of far-right and far-left parties, the liberal FDP party, which runs the finance ministry responsible for the stake sale, is feeling the pressure within the coalition.

As these developments unfold, all eyes will be on Commerzbank and UniCredit to see how the situation evolves, and whether the German bank will successfully maintain its desired independence or if a merger will become inevitable.