Metro Bank PLC Acquisition of RateSetter back book (6321N)
February 02 2021 - 2:00AM
UK Regulatory
TIDMMTRO
RNS Number : 6321N
Metro Bank PLC
02 February 2021
2 February 2021
Metro Bank PLC
Legal Entity Identifier: 213800X5WU57YL9GPK89
Acquisition of RateSetter back book
Accelerates strategic objective to enhance risk adjusted
returns
In line with its strategy of increasing its exposure to
unsecured personal lending, Metro Bank PLC ("Metro Bank" or "the
Company") today announces the acquisition of a portfolio of loans
(the "Portfolio") from peer-to-peer investors who have invested
through the Retail Money Market Ltd ("RateSetter") platform for a
cash consideration of up to GBP384 million (the "Acquisition"). The
exact amount is expected to be less as the Portfolio will continue
to amortise between announcement and expected completion in April
2021, following a two month notice period for retail investors.
The Portfolio had an aggregate book value of GBP384 million as
at 29 January 2021, with an average total gross yield of circa 8%.
The Portfolio consists primarily of unsecured consumer loans and is
amortising rapidly, with an average weighted loan term of 2 years
remaining. It is a well-seasoned portfolio delivering a consistent
credit performance.
The Portfolio is being acquired at par value. As announced on 18
December, the Company's pro forma CET1 ratio was circa 16.3% and
pro forma total capital plus MREL ratio was circa 24.2% as at 30
September 2020. On completion, the Acquisition is expected to
reduce the 30 September 2020 pro forma CET1 ratio by circa 0.6% and
the pro forma total capital plus MREL ratio by circa 0.9%.
Commenting on the acquisition, Daniel Frumkin, Metro Bank's
Chief Executive Officer said: "The addition of this portfolio to
our loan book is a further step towards growing our presence in the
unsecured lending market. It builds on our acquisition of the
RateSetter platform - a well-established business with a strong
technology platform that is enabling us to rapidly expand our
unsecured lending offering. We continue to deliver against Metro
Bank's strategic priority of optimising our balance sheet and asset
mix, whilst positioning ourselves to better serve customer needs as
the UK's best community bank."
The Portfolio is currently owned by a large number of retail
investors through the RateSetter platform. Under the terms of the
loan agreements, an agent acts as custodian of the loans on behalf
of the lenders (the "Agent"). The Agent is RateSetter, which is a
wholly owned subsidiary of Metro Bank, and, as such, is a related
party in accordance with LR 11.1.4R (2). Due to the size of the
Acquisition it will constitute a 'smaller related party
transaction' falling within LR 11.1.10R. Accordingly, Metro Bank
has obtained written confirmation from a sponsor that the terms of
the Acquisition are fair and reasonable as far as Metro Bank's
shareholders are concerned.
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulations (EU) No. 596/2014 as it forms part of
UK domestic law by virtue of the European Union (Withdrawal) Act
2018 and was authorised for release by David Arden, Chief Financial
Officer.
ENDS
Enquiries
For further information on this announcement, please
contact:
Investor Relations
Jo Roberts
+44 (0) 20 3402 8900
ir@metrobank.plc.uk
Media Relations
Tina Coates / Abigail Whittaker
+44 (0) 7811 246016 / +44 (0) 7989 876136
pressoffice@metrobank.plc.uk
Teneo
Charles Armitstead / Haya Herbert -- Burns
+44 (0) 7703 330269 / +44 (0) 7342 031051
metrobank@teneo.com
About Metro Bank
Metro Bank serves more than two million customer accounts and is
celebrated for its exceptional customer experience. It is the
highest rated high street bank for overall service quality, in
store service, and online and mobile banking services for personal
customers in the Competition and Market Authority's Service Quality
Survey in August 2020; the bank also ranked in the top two for
overall service, store service and digital services for business
customers. It was recognised as 'Bank of the Year' at the 2020
MoneyAge Awards.
The community bank offers retail, business, commercial and
private banking services, and prides itself on giving customers the
choice to bank however, whenever and wherever they choose, and
supporting the customers and communities it serves. Whether that's
through its network of 77 stores open seven days a week, early
until late, 362 days a year; on the phone through its UK-based 24/7
contact centres; or online through its internet banking or
award-winning mobile app: the bank offers customers real
choice.
Metro Bank PLC. Registered in England and Wales. Company number:
6419578. Registered office: One Southampton Row, London, WC1B 5HA.
'Metrobank' is the registered trademark of Metro Bank PLC.
It is authorised by the Prudential Regulation Authority and
regulated by the Financial Conduct Authority and Prudential
Regulation Authority. Most relevant deposits are protected by the
Financial Services Compensation Scheme. For further information
about the Scheme refer to the FSCS website www.fscs.org.uk .
All Metro Bank products are subject to status and approval.
Metro Bank PLC is an independent UK bank - it is not affiliated
with any other bank or organisation (including the METRO newspaper
or its publishers) anywhere in the world. Please refer to Metro
Bank using the full name.
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END
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