PHOTO
Pedestrians pass a branch of British bank Metro Bank in central London on October 6, 2023. Shares in British bank Metro Bank fell by more than 30% on Thursday on the London Stock Exchange after announcing that it was considering a fundraising or asset sales, investors worried about the company's efforts to strengthen its balance sheet. (Photo by Daniel LEAL / AFP)
London-listed Metro Bank will slash costs to make savings of up to £30 million per year following the agreement of an £925 million ($1.126 billion) rescue deal, according to stock market statements on Monday.
The bank saw its shares slump last week after reports that it needed to raise cash to shore up its finances, according to BBC reports, and then announced the rescue deal on Sunday night following reports that the UK’s Bank of England was seeking potential buyers.
London Stock Exchange (LSE) disclosures on Monday said the bank had secured a £325 million capital raise, and £600 million of debt refinancing, which it said would ‘ enhance balance sheet strength and accelerating earnings potential’.
Background to the rescue deal published on the stock exchange said the bank had launched a cost reduction plan in the fourth quarter of 2023 which would see savings of £30 million per year.
Amid speculation about whether the cuts would impact jobs at the bank or its 76 branches, chief executive Dan Frumkin told an analysts call that it would stick to its branch-based approach, according to a Financial Times report.
Metro Bank was launched in 2010 as the UK’s first new High Street bank in more than 100 years, at a time when many of the country’s banks were closing branches in favour of online banking.
The bank sold itself as an accessible bank with in-person service, and later opening hours, including on Sunday.
UK banks habitually close on a Sunday and open only during traditional nine to five office hours on the remaining days, with short opening hours on Saturday.
(Reporting by Imogen Lillywhite; editing by Brinda Darasha)
