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MarketScreener Homepage  >  Equities  >  London Stock Exchange  >  Metro Bank PLC    MTRO   GB00BZ6STL67


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Metro Bank : shares fall after it warns about investigations impact

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09/18/2019 | 04:57am EDT
FILE PHOTO: People walk past a Metro Bank in London

LONDON (Reuters) - Shares in Britain's Metro Bank fell as much as 6.5% on Wednesday after it said there could be "significant expense" to resolve investigations into a 900 million pound accounting error.

Metro Bank has struggled to rebuild investor confidence after disclosing in January it had under-reported the risk of its loan book.

The error forced the bank to raise 375 million pounds from shareholders in May and by July it said customers had pulled 2 billion pounds out of the bank.

In a bond prospectus published on Tuesday, Metro said the Financial Conduct Authority and Prudential Regulation Authority investigations had been broadened to include senior members of management and could lead to "criminal and/or civil liability for the bank" or suspension of its regulatory permissions.

"Making redress, and the cost of any regulatory sanctions may involve significant expense," the bank said.

It also warned that any negative publicity relating to regulatory investigations could undermine customer confidence and reduce demand for its products and services, which could have "a material adverse effect on its business".

Metro's shares, which have fallen 84% this year, were down 4.2% lower at 271.2 pence on Wednesday, the second biggest losers on London's midcap index <.FTMC>.

Metro also said that it had received notice in August that the FCA was extending the scope of its investigation to cover the period from June 1, 2017 to Metro's fourth quarter trading update issued on February 26 this year.

The warnings over the possible impact of the PRA and FCA investigations has raised questions over whether Metro will meet targets to issue debt this year in line with its regulatory requirements.

The Bank of England has set out guidelines on what banks will need to hold for so-called minimum requirement for own funds and eligible liabilities (MREL), as part of plans to better protect savers and taxpayers.

The lender, which muscled on to Britain's high streets in 2010, also said it would raise equity capital in the medium-term to support its controlled growth plans.

(Reporting by Noor Zainab Hussain in Bengaluru and Sinead Cruise in London; editing by Jason Neely)

Stocks mentioned in the article
ChangeLast1st jan.
METRO BANK PLC -4.13% 209.15166 Delayed Quote.-87.14%
PRUDENTIAL PLC -2.12% 1476.5 Delayed Quote.7.60%
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Financials (GBP)
Sales 2019 437 M
EBIT 2019 42,8 M
Net income 2019 -10,1 M
Debt 2019 -
Yield 2019 -
P/E ratio 2019 -57,3x
P/E ratio 2020 25,7x
Capi. / Sales2019 0,86x
Capi. / Sales2020 0,76x
Capitalization 376 M
Duration : Period :
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Technical analysis trends METRO BANK PLC
Short TermMid-TermLong Term
Income Statement Evolution
Mean consensus HOLD
Number of Analysts 14
Average target price 394,86  GBp
Last Close Price 217,80  GBp
Spread / Highest target 254%
Spread / Average Target 81,3%
Spread / Lowest Target -40,8%
EPS Revisions
Craig Francis Donaldson Chief Executive Officer & Executive Director
Vernon W. Hill Non-Executive Chairman
Aisling Kane Chief Operating Officer
David Thomas Arden Chief Financial Officer, Secretary & Director
Cheryl Newton Chief Information Officer
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