Commerzbank AG on September 29 said it plans a wide-ranging overhaul that includes laying off close to 10,000 jobs, or roughly 20% of its workforce, merging two large units and scrapping its dividend for this year.

The plan is a strong sign new chief executive Martin Zielke is determined to shrink the partially state-owned bank amid a protracted period of ultra-low or negative interest rates and weak client demand.