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Metro Bank confirms potential sale of loan portfolio

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  • 22/07/2019
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Metro Bank has confirmed it is considering selling part of its mortgage loan book in a statement issued to the stock market this morning.

 

There has been significant speculation the lender was looking to offload part of its book after regulators found it had underestimated the risk level of around £1.7bn of its £4.1bn commercial and buy-to-let loans.

In early February the lender pulled its range of portfolio commercial buy-to-let (BTL) products.

Then in May Metro Bank raised £375m in capital from shareholders through a discounted share offer to cover further capital requirements for the underestimated loan book.

However, the bank is now also looking to further improve its capital position by selling part of its mortgage book.

According to reports from Sky News over the weekend, a deal worth around £500m is set to be completed with US hedge fund Cerberus Capital Management.

The lender has previously bought more £1bn of assets from Cerberus .

The report added that the deal could be completed by Wednesday, when Metro’s half-year results are due.

 

Discussions ‘taking place’

In its statement, Metro Bank said it was aware of the recent press speculation regarding a potential disposal of a loan portfolio.

“The company regularly assesses various opportunities in the market and accordingly confirms that discussions regarding the potential sale of a loan portfolio are taking place,” it said.

“There can be no certainty at this stage that an agreement will be reached. A further announcement will be made if and when appropriate,” it added.

 

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