Metro Bank agrees £925m capital raise and debt refinancing package

The deal, announced today (9 October), includes a £325m capital raise – comprising £150m of new equity and £175m of new MREL issuance – alongside £600m of debt refinancing its balance sheet.  

Its equity raise will be led by the bank’s largest shareholder Spaldy Investments, which is contributing £102m to this deal. As part of this the investment firm– founded by Colombian billionaire Jaime Gilinski Bacal – will become the controlling shareholder of the bank with a 53% shareholding.  

As part of the deal, the high street lender has also said it’s aiming to slash about £30m of costs a year from 2025.  

It all comes as the bank confirmed that, overnight, customers had started to pull their money out in recent days amid worries over its financial health. However, the lender said it still expected current account balances to grow.

Metro Bank’s chief executive Daniel Frumkin said: “Today’s announcement marks a new chapter for Metro Bank, facilitating the delivery of continued profitable growth over the coming years. Metro Bank made a statutory profit after tax in the third quarter of 2023, and continues to demonstrate ongoing momentum as we strive towards our ambition to be the UK’s number one community bank.

“Our strong franchise is underpinned by our loyal customer base and engaged colleagues and we will continue to develop the Metro Bank offer to provide the digital and physical banking services our customers expect. We thank our shareholders and noteholders for their continuing support of Metro Bank and our customers.”

Spaldy Investments’ founder Jaime Gilinski Bacal added: “I have been an active investor in Metro Bank since 2019.  

“The opportunity to become the Bank’s major shareholder is driven by my belief in the need for physical and digital banking underpinned by a focus on exceptional customer service. I believe that the package announced today enables the Bank to pursue growth and build on the foundational work undertaken over the past three years.”