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UPDATE 3-Commerzbank chairman steps down for health reasons

* Chairman had joined Commerzbank last year

* Resignation kicks off search for new chair

* Commerzbank going through major restructuring (Updates with German finance minister, investor)

FRANKFURT, March 16 (Reuters) - Commerzbank said on Tuesday its chairman Hans-Joerg Vetter is stepping down for health reasons, sparking a search for a replacement in the midst of a major restructuring.

Vetter joined Commerzbank last year and helped install a new chief executive after a period of turmoil and a leadership vacuum at Germany’s second largest bank.

Commerzbank this year announced plans to cut 10,000 jobs and close hundreds of branches to become more profitable, with its management now in discussions with labour unions.

Vetter’s resignation came in the morning and is effective by the end of Tuesday, the bank said in a statement, adding that it was due to health reasons. It did not give details.

Deputy chair Uwe Tschaege will take on chairman’s responsibilities until a successor is named.

A spokesman for Commerzbank declined to comment.

The German government is the bank’s largest shareholder, with a nearly 16% stake resulting from a bailout during the last financial crisis.

German finance minister Olaf Scholz said that he hadn’t yet thought about a successor for Vetter. “I’m shaken,” he said.

Vetter has already made a big difference at Commerzbank, which now has a new strategic plan, said Deka, a top-10 investor in Commerzbank.

“The groundwork has been laid and a new supervisory board chairman continue with it,” said Deka portfolio manager Andreas Thomae in a statement to Reuters.

Cerberus, one of Commerzbank’s largest shareholders, had initially apposed the appointment of Vetter, the retired chief of a German regional bank. The activist U.S. private equity investor later vowed to work with him. (Reporting by Tom Sims, Patricia Uhlig and Christian Kraemer; Editing by Caroline Copley, Maria Sheahan, Alexander Smith and Louise Heavens)

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