Metro Bank PLC Sale of GBP3bn residential mortgage portfolio (2416J)
December 18 2020 - 1:33PM
UK Regulatory
TIDMMTRO
RNS Number : 2416J
Metro Bank PLC
18 December 2020
18 December 2020
Metro Bank PLC ("Metro Bank")
Legal Entity Identifier: 213800X5WU57YL9GPK89
Metro Bank confirms sale of GBP3bn residential mortgage
portfolio to NatWest Group plc ("NatWest")
Metro Bank today confirms the sale of a portfolio of owner
occupied residential mortgages (the "Portfolio") to NatWest for a
cash consideration of up to GBP3,128 million([1]) .
The Portfolio has a gross book value of GBP3,045 million with a
weighted average rate of 2.08%. The Portfolio consists of primarily
repayment mortgages with an average remaining fixed-rate term of
c.2.5 years. The Portfolio has a similar geographic distribution to
Metro Bank's wider mortgage portfolio and has a weighted average
current loan to value of c.60%.
The 2.7% premium on gross book value results in an estimated
GBP83 million gain on sale. On completion, the disposal is expected
to result in a 30 September 2020 pro-forma improvement in Metro
Bank's total capital plus MREL ratio of 400bps from 20.2% to 24.2%,
and a 30 September 2020 pro-forma CET1 ratio of 16.3%. The
transaction removes any current need to issue MREL qualifying
debt.
The transaction is in line with Metro Bank's strategy to enhance
risk-adjusted returns on capital through the ongoing focus on
balance sheet optimisation. In addition to increasing the Bank's
MREL resources, the sale creates additional lending capacity and
enables Metro Bank to rebalance asset mix towards higher yielding
assets such as specialist mortgages and unsecured loans.
Commenting on the disposal, Daniel Frumkin, Metro Bank's Chief
Executive Officer, said:
"As part of the transformation strategy we set out at the start
of 2020, we have been focusing on balance sheet optimisation to
drive better risk-adjusted returns on capital. The sale of part of
our residential mortgage portfolio will provide us with further
lending capacity and enable us to shift our asset mix and expand
our unsecured lending portfolio, following our entry into the
market with the acquisition of RateSetter earlier this year. The
transaction also removes any current need to issue MREL qualifying
debt."
ENDS
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 and was authorised
for release by David Arden, Chief Financial Officer.
Enquires
For further information 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.
([1]) There may be an adjustment to the financial impact and
consideration paid at completion under which loans representing up
to 10% by value of the Portfolio may be excluded from the sale,
equal to a potential reduction in consideration of less than GBP313
million. Beneficial risks and rewards of the Portfolio will
transfer to NatWest as at the date of this announcement and the
transaction is expected to financially close during the first
quarter of 2021.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
DISGPGGWPUPUGRR
(END) Dow Jones Newswires
December 18, 2020 13:33 ET (18:33 GMT)
Metro Bank (LSE:MTRO)
Historical Stock Chart
From Apr 2024 to May 2024
Metro Bank (LSE:MTRO)
Historical Stock Chart
From May 2023 to May 2024