Metro Bank Sees Profit In Q3, Secures Financing Deal With Investors; Stock Climbs

(RTTNews) - Shares of Metro Bank Holdings Plc (MTRBF, MTRO.L) were gaining more than 19 percent after the troubled lender said it expects to report a profit before tax in its third quarter, and announced financing deal with investors.

The company further said it is in discussions regarding an asset sale of up to 3 billion pounds of residential mortgages which are expected to reduce RWAs by around 1 billion pounds.

The company said it has secured 325 million pounds capital raise, comprising 150 million pounds of new equity and 175 million pounds of new MREL issuance. The company also announced 600 million pounds of debt refinancing.

Further, regarding its trading update, the firm said it made a profit after tax in the third quarter with continued momentum in Personal and Business Current Account growth and customer acquisition, in line with expectations.

The equity raise was led by Spaldy Investments Limited, Metro Bank's largest shareholder, which is contributing 102 million pounds. Spaldy Investments will become the controlling shareholder of Metro Bank upon completion of the deal with around 53 percent shareholding.

The Capital Package is subject to certain customary conditions and regulatory approvals. Metro Bank expects the transaction to complete in the fourth quarter.

Daniel Frumkin, Chief Executive Officer at Metro Bank, said, "Today's announcement marks a new chapter for Metro Bank, facilitating the delivery of continued profitable growth over the coming years. Metro Bank made a statutory profit after tax in Q3 2023, and continues to demonstrate ongoing momentum as we strive towards our ambition to be the UK's number one community bank."

Metro Bank's third-quarter trading update will be published in early November 2023.

In London, Metro Bank shares were trading at 53.90 pence, up 19.12 percent.