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Profits double at Metro Bank as loan book purchase boosts loan to deposit tally

Challenger bank Metro Bank has continued its impressive run of growth with its latest trading update for the first half of 2017.

The bank, which continues to open a string of new high street branches against prevailing trends in the industry, has enjoyed increases across its business as it continues to grab market share from the UK’s big banks.

According to Metro, deposits from customers were up 49% to £9.8bn in the first half of this year, an increase of 49% on the same time last year, while underlying pretax profit rose to £6m in H1 from a £13m loss last year. Pretax profit also doubled in Q2 this year, rising to £4m from £2m in Q1.

The bank’s financials were also boosted by the circa £600m acquisition of a majority buy-to-let loan book in June from US private equity firm Cerberus, which helped boost its loan to deposit ratio to 79%.

Craig Donaldson, Chief Executive Officer at Metro Bank celebrated the bank’s ‘strong’ performance in the first half of the year which he credited to sustained organic growth.

He commented: “This has been another great half year for Metro Bank with extremely strong organic lending supported by a c£600m book purchase increasing our Loan to Deposit ratio to 79%.

“This, taken together with continued strong deposit growth at a reducing cost of deposits, have led to us doubling our profits quarter on quarter, from £2m to £4m, and reporting our fourth consecutive quarter of profitability.”

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