Founder quits Metro Bank as profits plunge

MetrO Bank chairman vernon hill has stepped down sooner than expected as the lender revealed customers pulled out more than £200m in September.

hill ( pictured) – who founded Metro in 2010 and had promised to leave by the end of the year – said he would quit immediately and accept the title of emeritus chairman.

it came just hours before Metro announced its thirdquarter results. it slipped to a loss of £3.3m in the first nine months of the year from a £34.4m profit a year earlier.

After customers pulled out £213m in September alone, deposits were down 4pc yearonyear to £ 14.2bn. John Cronin, an analyst at goodbody, said there was ‘nothing to change our view to the effect that the strategy is in serious need of recalibration’.

total loans were flat on the previous quarter, at £14.9bn.

the bank also suffered a £2.5m charge in July after selling £521m of mortgages to US hedge fund Cerberus.

Metro confirmed it was ‘evaluating its future plans’, and would update investors further in its full-year results.

Craig Donaldson, the chief executive, said its rapid expansion plan – it has nearly 70 branches – may slow and he ruled out asking investors for more money. Donaldson said: ‘ We will adapt our growth plans to fit with the total capital that we have today, because we do not anticipate going back out to the market.’

he declined to comment on whether Metro had received any takeover approaches.

the lender said its outflows, mainly from commercial customers rather than individuals, followed its failed bond issuance. the debt- raise flopped in September after too few investors showed interest.

Metro later managed to raise £350m in a second debt issuance. the first signs of trouble at Metro emerged earlier this year, when it admitted it had misclassified the riskiness of some loans. its shares tumbled, and are 63pc lower than at the beginning of 2019.