Metro Bank raises £280m

METRO BANK tabled plans to raise up to £280m through a share issue last night after experiencing “strong and accelerating organic lending growth”, which had propelled it to its fourth straight quarterly profit.

The challenger bank said lending rose 67pc year on year to £7.8bn in the three months ended June 30.

This had been partly down to its purchase of a portfolio of UK mortgages worth almost £600m from US investment firm Cerberus early last month, which increased the size of its mortgage book by around 15pc.

“In order to support this momentum and the company’s future growth ambitions”, Metro said it had brought forward its plans to raise equity capital.

It issued up to 8m shares at £34.65 each, last night’s closing price, in an accelerated placing launched after the market closed yesterday. Shares in Metro have risen 80pc in the past year.

Metro Bank said in the recently ended quarter it had also experienced a 49pc rise in deposits to £9.8bn, which helped underlying pre-tax profits to double to £4m in its second quarter from £2m the prior quarter. On a year-on-year basis, Metro Bank swung to an underlying pretax profit of £6m in its first half from a loss of £13m a year earlier.