Metro Bank Holdings plc
Full year results
Trading update 2023
13 March 2024
Metro Bank Holdings plc (LSE: MTRO LN)
Results for year ended 31 December 2023
Highlights
| Statutory profit before tax of £30.5 million for the year, the first time since 2018, with a 67% year-on-year reduction in underlying loss to £16.9 million |
| Deposits of £15,623 million as at 31 December 2023 are up 1% from June leading to an elevated liquidity coverage ratio of 332% as at 31 December 2023 |
| Underlying revenue grew by 5% year-on-year reflecting effective asset rotation and increased yields plus 12% growth in capital efficient fee income, whilst costs marginally reduced, creating positive operating jaws |
| Continued to grow personal and business current accounts, opened 246,000 accounts in the year and over 52,000 of those were in the fourth quarter |
| On track to deliver £50 million of annualised cost savings in Q1 2024 as previously announced, these savings have been actioned with c.1,000 colleagues, equal to 22% of headcount, leaving before mid-April |
| A further £30 million of annualised cost savings is expected to be delivered by the end of 2024 |
| Remain committed to stores, including opening new stores in the North of England |
| Secured the capital position and extended the debt instrument maturities to 2028 or beyond |
Daniel Frumkin, Chief Executive Officer at Metro Bank, said:
“Overall, Metro Bank performed strongly in 2023 as we continued to position the business for growth. We were pleased to return to profit on a statutory basis and deliver our best half-year results for several years. After addressing our capital position in Q4, we also launched a successful deposit campaign, with deposits totalling £16.5 million as at the end of February 2024.”
“During the year we also launched a cost saving plan which included reducing store hours and roles across the organisation. These efforts will ensure the bank is right-sized for the future, with a strong focus on both digital and great customer service.”
“Looking forward, I remain confident in our ability to be the number one community bank. The work we have undertaken this year has laid the path to become a structurally profitable business and our focus towards the SME, Commercial and specialist mortgages sector presents an exciting opportunity in an underserved area of the market. I remain grateful for the continued support of our colleagues, customers and shareholders as we embark on the next chapter of our journey”.
Key Financials
£ in millions | 31 Dec 2023 | 31 Dec 2022 | Change from FY 2022 | 30 Jun 2023 | Change from H1 2023 |
| | | | | |
Assets | £22,245 | £22,119 | 1% | £21,747 | 2% |
Loans | £12,297 | £13,102 | (6%) | £12,572 | (2%) |
Deposits | £15,623 | £16,014 | (2%) | £15,529 | 1% |
Loan to deposit ratio | 79% | 82% | (3 ppts) | 81% | (2 ppts) |
| | | | | |
CET1 capital ratio | 13.1% | 10.3% | 280 bps | 10.4% | 270 bps |
Total capital ratio (TCR) | 15.1% | 13.4% | 170 bps | 13.2% | 190 bps |
MREL ratio | 22.0% | 17.7% | 430 bps | 18.1% | 390 bps |
Liquidity coverage ratio | 332% | 213% | 119 bps | 214% | 118 bps |
£ in millions | FY 2023 | FY 2022 | Change from FY 2022 | H2 2023 | H1 2023 | Change from H1 2023 |
| | | | | | |
Total underlying revenue1 | £546.5 | £522.1 | 5% | £260.9 | £285.6 | (9%) |
Underlying profit/(loss) before tax2 | (£16.9) | (£50.6) | 67% | (£33.0) | £16.1 | (305%) |
Statutory profit/(loss) before tax | £30.5 | (£70.7) | 143% | £15.1 | £15.4 | (2%) |
Net interest margin | 1.98% | 1.92% | 6 bps | 1.85% | 2.14% | (29 bps) |
Lending yield | 4.72% | 3.67% | 105 bps | 4.91% | 4.50% | 41 bps |
Cost of deposits | 0.97% | 0.20% | 77 bps | 1.29% | 0.66% | 63 bps |
Cost of risk | 0.26% | 0.32% | (6 bps) | 0.34% | 0.18% | (16 bps) |
Underlying EPS | (8.4p) | (30.5p) | 22.1p | (12.2p) | 7.8p | (20.0p) |
Tangible book value per share | £1.40 | £4.29 | (67%) | £1.40 | £4.42 | (68%) |
- Underlying revenue excludes grant income recognised relating to the Capability & Innovation fund and the gain relating to the capital raise and refinancing
- Underlying loss before tax is an alternative performance measure and excludes impairment and write-off of property, plant & equipment (PPE) and intangible assets, transformation costs, remediation costs, costs incurred as part of the holding company insertion and impacts of the capital raise and refinancing
Investor presentation
A presentation for investors and analysts will be held at 9AM (UK time) on Wednesday 13 March 2024. The presentation will be webcast on:
https://webcast.openbriefing.com/metrobank-mar24/
For those wishing to dial-in:
From the UK: +44 800 358 1035
From the US: +1 855 9796 654
Access code: 439242
Other global dial-in numbers: https://www.netroadshow.com/events/global-numbers?confId=59913
Financial performance for the year ended 31 December 2023
Deposits
£ in millions | 31 Dec 2023 | 31 Dec 2022 | Change from FY 2022 | 30 Jun 2023 | Change from H1 2023 |
| | | | | |
Demand: current accounts | £5,696 | £7,888 | (28%) | £7,106 | (20%) |
Demand: savings accounts | £7,827 | £7,501 | 4% | £7,218 | 8% |
Fixed term: savings accounts | £2,100 | £625 | 236% | £1,205 | 74% |
Deposits from customers | £15,623 | £16,014 | (2%) | £15,529 | 1% |
