Commerzbank, Germany's fourth largest commercial bank, is to make greater than expected risk provisions for last year, indicating that the nation's banking sector may not yet have recovered from the turmoil in international financial markets.

Commerzbank said Asia's difficulties had caused it to make risk provisions of DM1.75 billion, 01bn), below the DM1.86 billion put aside in 1997, but higher than the DM1.6 billion which the bank, last November, estimated would be necessary.

Mr Martin Kohlhaussen, the bank's chairman, who announced preliminary results to its supervisory board yesterday, did not specify what problems had emerged over the past three months to require an increase in the provisions.

According to banking analysts in Frankfurt, Commerzbank has had the largest exposure to southeast Asia of all the main German banks over the past two years.