About 2,500 of the 9,000 jobs that will be cut are set to be lost outside Germany, much of those at Dresdner Kleinwort, the group's straggling investment wing.
There are also plans to close more than a third of the combined group's 1,900 branches.
Its new acquisition will give Commerzbank a badly needed leg-up in its home market, which is dominated by not-for-profit, state-owned lenders.
Analysts and insiders were sceptical over whether the pairing of what many see as two mediocre performers could create a financial champion.
"It is good for Allianz. In the seven years they have owned Dresdner they have learned that they don't have a clue about running a bank," said Dirk Becker, an analyst with Landsbanki Kepler.
"But it is a huge integration. We will see in half a year that something will go wrong."
Commerzbank will buy Dresdner in two steps, taking 60 per cent this year and the rest in 2009 to create a rival to Deutsche Bank, the biggest in Germany.
Much of the purchase price will be paid to Allianz in the form of shares, leaving Europe's biggest insurer with a stake of almost 30 per cent in the new Commerzbank.
A further strand to the deal sees Allianz buying Commerzbank's fund management business Cominvest.