Metro Bank blames coronavirus as bank posts steep loss

Metro Bank today said coronavirus had impacted its financial performance as the bank reported a steep loss for the half year to June.

The bank swung to a loss of £183.4 million, down from a £13.6 milion profit this time last year.

The upstart bank, founded in 2015 to take on incumbent high street lenders, said it took a £109 million hit from the COVID-19 pandemic, mostly from rising expected loan losses as well as lower transaction fees.

The losses come as Metro Bank tries to turn itself around after a difficult few years.

Daniel Frumkin, boss at Metro Bank, said: "We entered 2020 at the start of our transformation journey, and while the pandemic has weighed heavily on our financial performance, we've made early progress delivering against the strategic priorities set out in February."

Customer deposits hit £15.6 billion, a 14% increase from the same time last year.

On Monday Metro agreed to buy peer-to-peer platform RateSetter for £2.5 million as it tries to find new revenue sources.

The bank’s core capital ratio, a key measure of financial strength, fell to 14.5% from 15.6% at the end of December.

Metro Bank said it was too early to assess if the coronavirus pandemic will impact its 2024 financial targets.