TIDMMTRO
RNS Number : 3242D
Metro Bank PLC
26 April 2017
Metro Bank PLC
Q1 Trading Update 2017
April 26, 2017
METRO BANK REPORTS 33% QUARTERLY GROWTH IN UNDERLYING PROFIT
BEFORE TAX AND RECORD GBP1.1 BILLION INCREASE IN DEPOSITS
Metro Bank PLC (LSE: MTRO) has delivered a strong trading
performance in the first quarter of 2017.
Q1 Highlights
* Record deposit growth in the quarter which exceeded
GBP1bn for the first time.
* Deposits up 13% quarter-on-quarter to GBP9.0b
($11.4b) whilst cost of deposits dropped from 66bp in
Q4 2016 to 61bp in Q1 2017.
* Record net deposit growth per store per month of
GBP7.4m ($9.3m) in Q1 2017 versus GBP5.0m ($6.3m) in
Q4 2016. Annualised this represents deposit growth
per store of GBP89m ($112m).
* Lending up 11%, quarter-on-quarter to GBP6.5b ($8.2b)
* Underlying profit before tax(1) at GBP2.0m (GBP1.5m
in Q4 2016).
* Record 72,000 increase in customer accounts to
987,000.
------------------------------------------------------------------
Note: All figures contained in this trading update are
unaudited. All figures in US$ have been translated at a rate of
$1.26 to the GBP.
(1) Underlying profit/(loss) before tax excludes listing related
costs, FSCS levy and impairment of property, plant & equipment
and intangible assets. The statutory profit after tax in the
quarter is set out in the profit and loss account.
Quarter ending 31 31 Change 31 Change
GBP in millions Mar Dec in Quarter Mar in
2017 2016 2016 Year
Assets GBP11,624 GBP10,057 16% GBP7,388 57%
Loans GBP6,482 GBP5,865 11% GBP4,129 57%
Deposits GBP9,010 GBP7,951 13% GBP5,898 53%
Loan to Deposit ratio 72% 74% 69%
Underlying Profit/(Loss) before tax GBP2.0 GBP1.5 33% (GBP9.6)m n/a
Total Revenue GBP61.9 GBP57.6 7% GBP37.7 64%
Net interest margin 2.02% 2.03% 1.96%
Underlying Profit/(Loss) after tax per share - basic 1.9p 1.6p 19% (13.0)p n/a
Underlying Profit/(Loss) after tax per share - diluted 1.8p 1.6p 13% (13.0)p n/a
-------------------------------------------------------- ---------- ---------- ------------ ---------- -------
Craig Donaldson, Chief Executive Officer at Metro Bank said:
"This is another great quarter for Metro Bank, and the results
are a testament to the strength of the model and our focus on the
integration of stores and technology to create FANS. We have now
delivered three consecutive quarters of profitability and for the
first time have exceeded GBP1 billion net growth in deposits in a
single quarter whilst also reducing the cost of those deposits. We
have seen double digit growth in lending (11%) and attracted an
additional 72,000 accounts, taking us to 987,000 customer accounts
across the bank.
"We continue to grow the business, and remain on track to open a
further ten stores before the year end. Our business continues to
deliver across all areas - Retail, Business, Commercial and Private
- and our model, culture and focus on creating FANS remains a
compelling alternative for consumers and businesses alike."
Vernon Hill, Chairman and Founder at Metro Bank, added:
"What a superb start to the year for Metro Bank. This quarter
saw improved performance on every level, across every measure and
best of all, we saw many more FANS opening accounts. Our
combination of great online and mobile banking and an exceptional
in store experience is making a positive difference to our
customers. Metro Bank remains a revolution in British banking,
championing the right of every customer to receive service and
convenience tailored to their needs."
Highlights for the Quarter Ended 31 March 2017
-- As of 31 March total assets were GBP11,624m, up from GBP10,057m
at 31 December 2016 and GBP7,388m at 31 March 2016; representing
16% growth in the quarter and year-on-year growth of 57%.
-- The loan to deposit ratio increased year-on-year to 72%
(31 March 2016: 69%).
-- Record net deposit growth per store per month of GBP7.4m
($9.3m) in Q1 2017 versus GBP5.0m ($6.3m) in Q4 2016, and
GBP6.6m ($8.3m) in Q1 2016 due to an exceptionally strong
quarter. This represents annualised deposit growth per store
of GBP89m ($112m).
-- Comparative store deposit growth (a measure of deposit growth
using deposit numbers from stores that have been operating
for more than a full year) is 50%.
-- As of 31 March total deposits were GBP9,010m, up from GBP7,951m
at 31 December 2016 and GBP5,898m at 31 March 2016; representing
13% growth in the quarter and year-on-year growth of 53%.
Deposits for the first quarter grew by GBP1.1bn. Deposits
from commercial customers represent 50% of 31 March 2017
total deposits (31 December 2016: 50%).
GBP in millions 31 Mar 31 Dec Change 31 Mar Change
2017 2016 in Quarter 2016 in Year
Demand: non-interest
bearing GBP2,582 GBP2,282 13% GBP1,587 63%
Demand: interest bearing GBP4,224 GBP3,513 20% GBP2,476 71%
Fixed term GBP2,204 GBP2,156 2% GBP1,835 20%
---------- ---------- ------------ --------- ---------
Deposits from customers GBP9,010 GBP7,951 13% GBP5,898 53%
---------- ---------- ------------ --------- ---------
Deposits from customers
includes:
Deposits from retail
customers GBP4,464 GBP3,945 13% GBP2,775 61%
Deposits from corporate
customers GBP4,546 GBP4,006 13% GBP3,123 46%
---------- ---------- ------------ --------- ---------
-- Cost of deposits in Q1 was 61bps, a reduction from 66bps
in Q4 2016. This reflects management actions with regards
to deposit re-pricing, and strong growth in current accounts.
-- Total net loans as of 31 March were GBP6,482m, up from GBP5,865m
at 31 December 2016 and GBP4,129m at 31 March 2016; an increase
of 11% in the quarter and 57% year-on-year. Loans to commercial
customers represent 35% of total lending as of 31 March
2017 (31 December 2016: 36%).
GBP in millions 31 Mar 31 Dec Change 31 Mar Change
2017 2016 in Quarter 2016 in Year
Gross Loans and advances
to customers GBP6,491 GBP5,872 11% GBP4,136 57%
Less: allowance for impairment GBP(9) GBP(7) 29% GBP(7) 28%
Net Loans and advances
to customers GBP6,482 GBP5,865 11% GBP4,129 57%
Gross loans and advances
to customers includes:
Commercial loans GBP2,276 GBP2,087 9% GBP1,428 59%
Residential mortgages GBP4,023 GBP3,604 12% GBP2,566 57%
Consumer and other loans
and advances GBP192 GBP181 6% GBP142 35%
---------- ------------ ------------ --------- ---------
-- Asset quality remains strong. Non-performing loans were
0.18% of the portfolio and the loan loss reserve as a percentage
of non-performing loans was 77% at 31 March 2017. Cost of
risk remained low and stable in Q1 2017 at 0.11% compared
to 0.11% in Q4 2016 and 0.10% for the full year to 31 December
2016.
-- Capital ratios remain robust and well above regulatory requirements.
Common Equity Tier 1 Capital ("CET1") as a percentage of
risk weighted assets is 15.9%. The Regulatory Leverage ratio
is 5.6%. A move towards the advanced risk based (AIRB) approach
in the medium term presents the opportunity to achieve greater
capital efficiency.
-- Customer acquisition continues to be strong. Customer accounts
have increased from 915,000 on 31 December 2016 to 987,000
at 31 March 2017; a record quarterly net increase of 72,000
accounts. This represents an increase of 8% in the quarter
and 38% year-on-year.
-- Underlying profit before tax has improved by 33% quarter-on-quarter
to GBP2.0m from GBP1.5m in Q4 2016 (compared to a loss of
GBP9.6m in Q1 2016).
-- Our positive P&L "jaws" continued with Total Revenue up
64% year-on-year and Operating expenses up 26%.
-- We will strengthen our network with a further ten new stores
in 2017 as we continue to in-fill and expand our reach.
We remain confident in our ability to deliver a full year of
profitability in 2017 and to achieve our 2020 guidance. Our
disruptive model continues to go from strength to strength.
Metro Bank PLC
Balance Sheet and Profit & Loss Account
(Unaudited)
Annual 2017 2016
Growth
Rate
Balance Sheet 31-Mar 31-Dec 31-Mar
GBP'm GBP'm GBP'm
Assets
Loans and advances to customers 57% 6,482 5,865 4,129
Treasury assets(1) 4,637 3,727 2,906
Other assets(2) 505 465 353
------- ------- -------
Total assets 57% 11,624 10,057 7,388
------- ------- -------
Liabilities
Deposits from customers 53% 9,010 7,951 5,898
Deposits from banks 1,235 543 -
Other liabilities 571 759 691
------- ------- -------
Total liabilities 10,816 9,253 6,589
------- ------- -------
Total shareholder's equity 808 804 799
------- ------- -------
Total equity and liabilities 11,624 10,057 7,388
------- ------- -------
Annual 2017 2016
Growth
Rate
Profit & Loss Account Q1 Q4 Q1
GBP'000 GBP'000 GBP'000
Net interest income 50,446 46,651 30,507
Fee and other income 10,892 10,470 7,240
Net gains on sale of securities 598 525 40
--------- --------- ---------
Total revenue 64% 61,936 57,646 37,787
Operating expenses 26% (58,403) (54,585) (46,236)
Credit impairment charges (1,560) (1,577) (1,113)
Underlying profit/(loss) before
tax n/a 1,973 1,484 (9,562)
Underlying taxation (485) (285) 1,617
Underlying profit/(loss) after
tax n/a 1,488 1,199 (7,945)
Listing and related costs (353) (568) (3,107)
FSCS levy (net of tax) (48) - -
Statutory profit/(loss) after
tax n/a 1,087 631 (11,052)
--------- --------- ---------
(1) Comprises investment securities, cash & balances with
the Bank of England, and loans and advances to banks
(2) Comprises property, plant & equipment, intangible assets
and other assets
Analyst and investor call
An analyst and investor call will be held as follows:
Date: Wednesday 26(th) April 2017
Time: 2.00pm (BST)
From the UK dial: 0808 237 0030 (Toll Free)
From the US dial: 866 928 7517 (Toll Free)
Participant Pin: 61414746#
URL for other international dial in numbers:
http://events.arkadin.com/ev/docs/NE_FEL_Events_International_Access_List.pdf
An operator will assist you in joining the call.
For more information, please contact:
Metro Bank PLC Press Office
Tina Coates
+44 (0) 7811 246016
tina.coates@metrobank.plc.uk
Metro Bank PLC Investor Relations
Jo Roberts
+44 (0) 20 3402 8900
jo.roberts@metrobank.plc.uk
Martin Pengelley/ Latika Shah
Tulchan Communications
+44(0)20 7353 4200
metrobank@tulchangroup.com
ENDS
About Metro Bank
Retail banking:
-- 7 days a week store banking (8am-8pm Monday to Friday, 8am-6pm
Saturday, 11am-5pm Sunday and bank holidays), 362 days of
the year.
-- The ultimate in new account opening convenience, with a
rapid opening procedure and on the spot bank cards and cheque
books (Account Opening conditions apply. All Metro Bank
products are subject to status and approval.)
-- Offering customers their channel of choice - with real time
processing enabling real time fulfilment.
-- All stores offer free coin counting, for customers and non-customers
alike, with the Metro Bank Magic Money Machine(TM), as well
as Safe Deposit Boxes of varying sizes for customers to
store their valuables.
-- A friendly welcome to dogs and their owners, with water
bowls and dog biscuits on hand for man's best friend - dogs
rule at Metro Bank!
Business and Commercial banking:
-- Metro Bank offers tailored business banking services including
a full range of lending and cash management solutions, with
customers supported by locally-based relationship, product
and credit teams
-- A dedicated team of relationship managers provide industry-specific
guidance, with sector experts covering healthcare; hospitality
and leisure; property; charities and not-for-profit; inwards
investment; and financial services
-- Forward thinking combined with traditional banking values
gives customers a single point of contact to support them
with all their banking needs
-- Simple and transparent lending means customers have direct
access to the bank's underwriters
Private banking:
-- Private by name, personal by nature: Metro Bank Private
Banking provides bespoke banking solutions for customers'
personal and commercial interests
Metro Bank PLC. Registered in England and Wales. Company number:
6419578. Registered office: One Southampton Row, London, WC1B 5HA.
'Metrobank' is the registered trade mark of Metro Bank PLC.
We're 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.
Forward looking statements
This announcement may include statements that are, or may be
deemed to be, forward-looking statements. Forward-looking
statements typically use terms such as "believes", "projects",
"anticipates", "expects", "intends", "plans", "may", "will",
"would", "could" or "should" or similar terminology. Any
forward-looking statements in this announcement are based on the
Company's current expectations and, by their nature,
forward-looking statements are subject to a number of risks and
uncertainties, many of which are beyond the Company's control, that
could cause the Company's actual results and performance to differ
materially from any expected future results or performance
expressed or implied by any forward-looking statements. As a
result, you are cautioned not to place undue reliance on such
forward-looking statements. Past performance should not be taken as
an indication or guarantee of future results, and no representation
or warranty, expressed or implied, is made regarding future
performance.
No assurances can be given that the forward-looking statements
in this announcement will be realised. The Company undertakes no
obligation to release the results of any revisions to any
forward-looking statements in this announcement that may occur due
to any change in its expectations or to reflect events or
circumstances after the date of this announcement and the Company
disclaims any such obligation.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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