Metro Bank

DoneWorking

Thinking of transferring my cash ISA to Metro after it mature with another Building Society
It will be under the £85k limit for protection so I realise my money is safe
But just wondering if Metro Bank is considered financially secure 
Thanks 

la531983

You dont need to ask the question in the 3rd line of your post given you wrote the 2nd line of it, tbh.

wmb194

DoneWorking said:

Thinking of transferring my cash ISA to Metro after it mature with another Building Society
It will be under the £85k limit for protection so I realise my money is safe
But just wondering if Metro Bank is considered financially secure 
Thanks 

I think there might be a couple of things to finalise procedurally i.e. a meeting on 27/11/23 to agree it all but since the announced capital injection and debt for equity swap everyone seems to have calmed down so it should be okay for the foreseeable. It's certainly dropped out of the main business news.

https://www.reuters.com/business/finance/metro-bank-says-deposit-outflows-return-more-normal-ranges-2023-11-07/

https://www.londonstockexchange.com/news-article/MTRO/publication-of-the-prospectus-and-circular/16203862

subjecttocontract

I think opening a savings account with Metro will be ok. It has FSCS protection so there is no chance a saver will loose money.

I can't say the same for shareholders......im certainly steering well clear of any share holding in Metro.

DoneWorking

la531983 said:

You dont need to ask the question in the 3rd line of your post given you wrote the 2nd line of it, tbh.

I don't think you understand my post
I accept my money is safe up to £85k
I'm then asking is the bank now considered to be in a good financial state

boingy

They had a bit of a wobble last month:
Metro Bank shares plunge on fund raising reports - BBC News

But they seem to have secured some funding. Whether that constitutes a "good financial state" is anyone's guess. They also had problems in early 2020 having posted a large loss.

However, the first £85K of your money is safe and they would probably be bought by a rival rather than go under so I'd say go for it, assuming you don't mind visiting a branch to open the account.

masonic

Of more concern is the current regulatory action being taken by the FCA. If they move to enforcement, bear in mind your money could be inaccessible for whatever period of time it takes for the situation to either resolve or deteriorate enough to precipitate a FSCS payout.

subjecttocontract

masonic said:

Of more concern is the current regulatory action being taken by the FCA. If they move to enforcement, bear in mind your money could be inaccessible for whatever period of time it takes for the situation to either resolve or deteriorate enough to precipitate a FSCS payout.

Well that's frightening comment.......that says don't put your money in Metro because you might not see it for a very long time. 

Do you think they should stop offering to open new accounts ?

masonic

subjecttocontract said:

masonic said:

Of more concern is the current regulatory action being taken by the FCA. If they move to enforcement, bear in mind your money could be inaccessible for whatever period of time it takes for the situation to either resolve or deteriorate enough to precipitate a FSCS payout.

Well that's frightening comment.......that says don't put your money in Metro because you might not see it for a very long time. 

Do you think they should stop offering to open new accounts ?

For details (there really isn't much detail offered), see page 196 of their prospectus published a few days ago: https://www.metrobankonline.co.uk/globalassets/documents/customer_documents/business-and-commercial/the-combined-prospectus-and-circular-dated-9-november-2023.pdf

It's really not at all clear what the outcome will be, but the FCA has the power to prevent a firm from reducing its capital reserves, which means they cannot repay depositors. If there is lots of dodgy money swimming around in their reserves, this could pose a problem. As we learned from DotComUnity credit union, who were put in this position (capital restrictions) a few years ago after launching a top-buy cash ISA, the situation can carry on for months. While there is ultimately no risk to capital if keeping within FSCS limits, I imagine it to be a most disagreeable situation to be in.

I think, if the FCA investigation turns up anything too concerning, Metro should be prevented from accepting any more deposits, but I have little faith the FCA will act quickly enough to protect consumers. It never has before.

moneysaver1978

Putting aside financial safety, is Metro offering the best rate?

I recently closed my savings account because the interest rates offered weren’t competitive compared to the market.

masonic

Joint best, with both options having drawbacks. There are some slightly lower paying alternatives.

https://forums.moneysavingexpert.com/discussion/6392978/top-easy-access-acs-ranked-top-of-the-pots-no-chat/p1

I feel fortunate to have the now closed issue Santander account at the same rate.