The bank's recovery is largely the work of Mehmet Dalman, the managing board member for investment banking. He slashed costs by more than 25% last year. While cutting staff, he integrated the corporate and investment banking operations. "By bringing them together, you cut costs and have a shot at high margins and cross-selling," says Dalman, 45. He also carved out a profitable niche for Commerzbank in the credit-derivatives business and boosted its trading operations -- which generated a profit of $270 million in the first quarter.
There have been a few bumps, but by all accounts Dalman has handled them well. Last October, Commerzbank was hit by unfounded rumors that the credit-derivatives division had racked up large losses. Dalman quashed the speculation. "I told the rating agencies they should come in and look at our books. We were 100% comfortable about our business," he says.
Dalman, who was born in Cyprus and studied international history at University of London, was lured to Commerzbank in 1997 after stints at several investment banks in London. He is the first foreigner to join the management board. Judging by his performance, Commerz made the right move in tapping this finance star.