UPDATE 2-Investor Cerberus open to Deutsche Bank merger with Commerzbank - source

U.S. investor Cerberus, a major shareholder in both Deutsche Bank and Commerzbank, is open to a merger between Germany's two biggest lenders, a person familiar with the matter said on Wednesday, raising the chances of a tie-up. Speculation of a merger has heightened under the tenure of Finance Minister Olaf Scholz, who has spoken in favour of strong banks. Both banks have been slow to return to sustainable profitability since the global financial crisis.

"Cerberus wouldn't stand in the way of a merger," said the person familiar with the thinking of the U.S. buyout firm. Cerberus holds 3 percent of Deutsche Bank shares and 5 percent of Commerzbank shares, and was previously opposed to a merger, German newspaper Handelsblatt reported on Tuesday.

The buyout firm believes there is still room in Germany for two big banks but that it is an open question whether both can turn around their businesses on their own, the person said. Cerberus hasn't yet decided on the need for a merger, the person added.

Deutsche Bank and Commerzbank declined to comment. Based on Tuesday's closing prices, a combination of Deutsche Bank and Commerzbank would have an equity market value of almost 25 billion euros ($28 billion).

Deutsche Bank has more than 20 million personal and business customers, and Commerzbank around 18 million. Cerberus is among the largest shareholders in both banks after buying stakes in 2017. Since then, the shares of both lenders have fallen sharply.

($1 = 0.8778 euros) (Reporting by Hans Seidenstuecker and Tom Sims; Editing by Thomas Seythal and Mark Potter)