Metro Bank seeks bids within weeks for £3bn mortgage book

Metro Bank to seek bids of £3bn for mortgage book

Metro Bank has provided its rivals with a small window of opportunity to buy its substantial mortgage portfolio.

Metro Bank has offered rivals like Barclays, Lloyds Banking Group, and NatWest Group to submit their bids at the beginning of the next month after they showed a keen interest.

The announcement of the timetable came a few days later when the high-street bank secured a £925 million refinancing package involving major stakeholder Jaime Gilinski Bacal, a Colombian billionaire.

The bank’s survival came into question after it sought City advisers to raise hundreds of millions of pounds of new capital.

In total, it aims to raise about £150 million of new equity, £175 million of new debt, and refinance £600 million of existing borrowings.

Although analysts have questioned the implication of mortgage book sales from a fair value accounting perspective, Metro Bank’s chief executive, Daniel Frumkin, suggested last week that by the end of the year, a sale would be wrapped up.

After launching in 2010, Metro Bank became the first new lender to emerge on the high streets of Britain in over 100 years. It has roughly 2.7 million customers.

With more than 75 branches across the country, Metro Bank employs more than 4,000 employees while offering current accounts, business accounts, personal loans, and insurance products.

Metro Bank was compelled to sell its assets in the past with a deal to sell a portfolio of owner-occupied home mortgages to NatWest Group in December 2020 for roughly £3.1 billion.

Metro Bank was unavailable for comments on the deadline regarding the mortgage book bid.

- Published By Team Timeswire

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