Metro Bank - In difficulty?

boingy

Beeb news article:

Metro Bank shares plunge on reports of urgent fund raising - BBC News

GeoffTF

They meet their solvency requirements, but their long term future is unclear. Metro is opening branches when the big banks are closing theirs, or reducing the level of service that they offer. Branches cost money. Ultimately, the customer has to pay more if he wants them. Are there enough customers wiling to pay?

[Deleted User]

GeoffTF said:

They meet their solvency requirements, but their long term future is unclear. Metro is opening branches when the big banks are closing theirs, or reducing the level of service that they offer. Branches cost money. Ultimately, the customer has to pay more if he wants them. Are there enough customers wiling to pay?

It's more fundamental than branch offerings - It probably needs to merge with or be taken over by another bank.

None of big banks would be allowed to unless it's on the verge of failure. With the smaller ones, none obviously see value in it currently and are waiting for the share price to drop further or get it on the cheap as part of a rescue plan.

Miser1964

Run, don't walk, to get your money out!

CliveOfIndia

Miser1964 said:

Run, don't walk, to get your money out!

Unless you've got more than £85,000 stashed with them, that's something of an unnecessary scare-mongering statement.

https://www.moneysavingexpert.com/savings/safe-savings/

WillPS

GeoffTF said:

They meet their solvency requirements, but their long term future is unclear. Metro is opening branches when the big banks are closing theirs, or reducing the level of service that they offer. Branches cost money. Ultimately, the customer has to pay more if he wants them. Are there enough customers wiling to pay?

Metro are also closing branches: https://www.metrobankonline.co.uk/ways-to-bank/store-closures/

boingy

I'll be leaving my fiver in Metro for now. It's really just waiting for another switching opportunity.
I would expect Metro to be bought rather than go under. The problem is that once this stuff is reported in the mainstream press then inevitably people start withdrawing their money, which quickly gets out of hand.

WillPS

IanManc said:

WillPS said:

GeoffTF said:

They meet their solvency requirements, but their long term future is unclear. Metro is opening branches when the big banks are closing theirs, or reducing the level of service that they offer. Branches cost money. Ultimately, the customer has to pay more if he wants them. Are there enough customers wiling to pay?

Metro are also closing branches: https://www.metrobankonline.co.uk/ways-to-bank/store-closures/

It's a bit of a stretch to say they "are closing" branches - they closed a total of three, more than fifteen months ago.

Earl's Court was one of their earliest, and they explain that it has low footfall and is poorly located, with newer branches since opened which are 0.4 miles, 1 mile, and 1.4 miles away. 

Milton Keynes Midsummer was closed because there was another, larger branch 1.9 miles away, and Metro said they didn't need two branches in Milton Keynes.

Windsor was closed because newer branches were opened that serve the same area, including one in Slough which is only 2.3 miles away.

Three closures over a year ago for valid reasons, where expansion of the branch network has left the closing ones quiet, and with alternative branches very close by doesn't put Metro in the same league as other banks in terms of closures.

3 sounds low but worth considering their estate is only in double digits and their branch network is very young; it's not insignificant.

ColdIron

1.65% easy access won't attract much money from savers. They were an early switch donor for me

A shame as their ISAs used to be good when they started and a few of their fixes were worth it

stripling

I like Metro Bank. Smooth, clear app, excellent transfer system, everything simple, efficient and clean. I'm sure they're not 'going under' they are just fund raising. 

boingy

stripling said:

I'm sure they're not 'going under' they are just fund raising. 

Don't be so sure. The latest slump in their share price resulted in the shares briefly being suspended today and the price has dropped by about 72% since the start of the year. That's not going to make it easy to raise funds, but might make it a whole lot easier for someone to buy them.

If you want a real giggle look-up their 5 year share price graph. The price has gone from £27 to 36p.