The Metro Bank Saga

Hey FinTech Fanatic!

Metro Bank Holdings Plc's recent journey is a key example of resilience in banking. Facing short seller pressure and a need for a capital boost, the bank announced a major refinancing plan , including a ￡325 million capital raise led by Spaldy Investments and ￡600 million in debt refinancing.

This move was critical, as failure could have led to the bank being deemed "unviable" by the Bank of England.

The shareholder vote proved decisive, with over 90% approving a ￡150 million equity raise, integral to the ￡925 million rescue deal. This marked a turning point, allowing Colombian billionaire Jaime Gilinski's Spaldy Investments to increase its stake to about 53%. Metro Bank then took bold steps, like tripling interest rates on deposits and shifting focus to higher-margin specialist mortgages.

Concurrently, Metro Bank entered talks with Barclays for the sale of its US$3.74 billion residential mortgages portfolio, a move likely to realign its assets and improve liquidity. These developments showcase Metro Bank's strategic navigation through financial challenges, signaling a potential turnaround in its fortunes.

To be continued...

Cheers,

Marcel

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