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Metro Bank seeking bidders for £3bn mortgage book – reports

  • 06/10/2023
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Metro Bank seeking bidders for £3bn mortgage book – reports
Challenger bank Metro Bank has started looking for buyers for its £3bn mortgage book in an effort to shore up its balance sheet, media reports have suggested

Initially reported in Sky News, Metro Bank has allegedly contacted Lloyds Banking Group and Natwest as potential buyers.

Sky News said that it was unclear at this moment in time whether either high street lender was interested in acquiring the mortgage book.

The report added that the sale process of the mortgage book would be part of a bigger capital-raising exercise.

Earlier this week, reports suggested that the bank was seeking £600m capital raise after the regulator delayed approval to allow it to use its internal risk model for residential mortgages.


Metro Bank share price plummets

Metro Bank’s share price fell to a low of 34.97p at one point yesterday, a decrease from 51.36p at the end of the previous day. The bank’s share price has since rebounded slightly and stands at 40.39p as of 9:15am.

Analyst firm DBRS Morningstar said that it expected Metro Bank’s access to external financing will be “highly constrained” due to its low market cap.

It also noted that whilst its loan book was performing in line with peers it was facing a “number of structural issues” including an elevated cost base.

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