Metro Bank narrows full-year losses

Metro Bank reported a narrowing of its annual losses on Thursday as it benefited from a rise in interest rates.

In the year to the end of December, underlying pre-tax losses narrowed to £50.6m from £171.3m a year earlier. Total underlying revenue increased 31% to £522.1m. The bank said this reflected "the shift in deposit and asset mix, the impact of the higher Bank of England base rate, and a recovery in customer activity".

Underlying costs fell 3% to £532.8m despite inflationary pressures. This was due to management actions to control cost and leverage the fixed cost base for profitable growth, Metro said.

The bank’s net interest margin widened to 1.92% from 1.40% in 2021. Looking ahead, however, Metro said it expects NIM accretion to be limited by fewer anticipated base rate moves.

Chief executive Daniel Frumkin said: "I’m pleased with Metro Bank’s performance over the past year and the successful completion of our transformation plan. We returned to profitability, resolved our legacy issues and further strengthened the foundations for future sustainable growth.

"While I remain confident in the underlying business, material headwinds do exist, including the macro-economic environment and increasing competition for liabilities. We have established the basis to transition back to being a profitable growth engine, committed to serving our communities through our network of stores, digital offerings and stand-out customer service, as seen in the latest CMA results."