Commerzbank (CRZBY) stock led the European banking sector higher Wednesday after it was revealed that U.S. private equity firm Cerberus Capital Management has taken a stake in the German lender. 

The bank published a filing from Cerberus showing the buyout shop having bought a stake that gives it control over 4.90% of the voting rights attached to its shares. 

Commerzbank shares were marked 2.4% higher in afternoon trading in Frankfurt to change hands at €11.06 each, with a gain more than double the 1.2% advance for Deutsche Bank (DB) - Get Report and far ahead of the 0.02% increase seen in the Stoxx Europe 600 Banks index. Commerzbank stock is up more than 50% for the year-to-date. 

Representatives for the bank did not immediately respond to a request for comment. However, Bloomberg reported earlier in July that Cerberus was considering a minority investment in the bank's shares in order to gain exposure to the recovery in European banking.

The bank beat analyst expectations for earnings and regulatory capital generation in the first quarter. It reported net income of €217 million ($245 million) on net-interest income of €1.08 billion and a common equity tier 1 capital ratio of 12.5%, which was ahead of the consensus for 12.2%. 

Back in September 2016, Germany's second largest bank cited low interest rates, regulation and competition as being behind increasing pressure on its profitability - before unveiling a broad revision of its corporate strategy.

The bank chopped its dividend for the foreseeable future and also said that it will take the ax to 7,300 employees over the coming years, in addition to simplifying its corporate structure.

Under the new structure there will be just two reporting segments as opposed to four, with corporate customers and all things investment banking related sitting on one side of the institution, while SMEs and private customers sit on the other.

Management said at the time that the changes will help bring the bank's cost-income ratio down to the target 66% level and boost returns on equity. The bank is targeting a return on tangible equity of at least 6% by 2020.

Commerzbank also told investors that it can grow revenue by nearly 10%, to €9.8 billion, over the coming years regardless of what happens with interest rates.