Metro ramps up cost-cutting plan

Bank scraps seven-day-a-week opening

TROUBled lender Metro Bank is stepping up its job cuts as it battles to return to profit after a rescue deal last autumn.

And it will end seven-day-aweek opening as it seeks to slash costs.

Boss daniel Frumkin admitted that an effort to stem a customer exodus last autumn had partly backfired as more customers than expected took on attractive savings deals.

The bank said around 1,000 jobs, or 22pc of the workforce, would go by this spring, as part of a £50m cost- cutting programme – up from an initial estimate of 850.

And a further £30m efficiency drive announced yesterday will ‘inevitably’ result in more going, Frumkin admitted.

Metro reported an annual loss of £16.9m for 2023, smaller than 2022’s £50.6m, and Frumkin said it was ‘anticipating losing money’ this year.

‘We expect the actions taken in 2023 to impact our results in 2024 as it would any business, before we see the benefits materialise in 2025,’ he added. Metro was founded in 2010 to challenge Britain’s big banks, opening seven days a week and for longer. But it ran into trouble last autumn before its future was secured via a £925m fundraising when Colombian billionaire Jaime gilinski Bacal became majority shareholder.

All 76 branches will no longer open on Sundays or bank holidays, with 44 only opening five days a week, from 9.30am to 5pm while the remaining 32 will also open on Saturdays, from 11am to 4pm.

Currently, its branches are open from 8.30am to 6pm from Monday to Saturday and from 11am to 5pm on Sundays.

No branches will close and at least 11 more will open, mainly across the north of england.

Metro’s poor profit outlook is partly explained by its response to an exodus of customer deposits last autumn ‘following press speculation’.

That was reversed when it ramped up savings rates and in fact proved too successful, leaving it with more money in high-interest paying accounts than it wanted – squeezing profit margins.

Current account deposits fell 28pc but savings rose 4pc and fixed term deals by 236pc.

‘We need to work through those higher cost deposits and either lend them out at a good margin or shrink our deposit base,’ Frumkin said.

‘The deposit campaign we ran exceeded all expectations. We did not set out to end up with £16.5bn of deposits at the end of February – that is a much bigger number than we were anticipating getting to.’

Asked whether the campaign to tempt savers back had been too generous, Frumkin said: ‘Maybe - I don’t know. I really try hard to think about tomorrow.

‘I’m now old enough that I realise that thinking about yesterday does you no good.’

Shares fell 4.9pc, or 1.7p, to 32.7p, and have lost about two thirds in value since Metro plunged into crisis last year.