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(Alliance News) - Metro Bank PLC said Wednesday Chair Vernon Hill is stepping down from his role with immediate effect, but will remain a non-executive director until the end of 2019.
The challenger bank has offered Hill the honorary position of 'emeritus chair'. The honorary title is to recognise his "extraordinary contribution" to the lender, Metro Bank said.
Non-Executive Director Michael Snyder has been appointed interim chair while the lender seeks a permanent successor for Hill.
Hill - who founded the firm in the UK in 2010, having found success with the Metro Bank formula in the US - previously announced his intention to step down from the bank before the end of 2019. He explained that the lender would be better served by having an independent chair.
The lender is scheduled to release its third quarter results later Wednesday. Metro Bank, which was recently demoted from the FTSE 250 index, has been dogged all year following a string of related accounting and financial issues.
Metro Bank had to postpone a debt issue in September due to "market conditions".
At the time, Metro Bank said a "broad number" of investors showed interest in a maiden MREL issuance, which it needed to complete to meet EU rules. MREL stands for minimum requirement for own funds and eligible liabilities and relates to EU solvency legislation. The Financial Times had reported Metro Bank that had been forced to withdraw a GBP200 million to GBP250 million bond offering, after only receiving orders for GBP175 million.
Then, in October, Metro Bank priced a GBP350 million six-year maturity MREL-eligible senior non-preferred debt transaction, saying it was looking into more actions to enhance capital efficiency.
The debt has a coupon of 9.5000% and, following this issue, Metro will meet its interim MREL requirement plus its 21.5% buffers.
The debt offering blow came after UK regulators spotted an error in the bank's loan book, though Metro Bank originally said it found the problem itself. Addressing the error required finding additional capital.
Shares in the challenger bank closed 1.5% lower on Tuesday at 193.00 pence each. Metro Bank shares opened 2019 just above 1,700p.
By Paul McGowan; paulmcgowan@alliancenews.com
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