Metro Bank has announced that it will repay £50 million of bailout funding to RBS. The announcement arrives as the bank altered its strategy after releasing its full-year results and scaled-back its plans for branch expansion over the next few years.
The company’s plans were thwarted when it was revealed that it was miscategorizing a number of loans when figuring out capital requirements.
The error caused the departures of Chairman Vernon Hill and CEO Craig Donaldson. The bank had to reconfigure its strategy after fourth-quarter results showed a pre-tax loss of £130.8 million, which included a £68 million write-down related to stopping IT projects that are no longer part of the bank’s strategy.
Metro, Starling, and ClearBank were given a combined £280m from the RBS bailout fund in February 2019, beating off competition from better-known brands TSB, Co-operative Bank, and CYBG.
Dan Frumkin, chief executive officer at Metro Bank, says: “Our financial performance reflects a very challenging year for Metro Bank. External headwinds, internal challenges and actions we took to put the business on a more positive trajectory are reflected in the results.”