UK's Metro Bank ramps up lending to challenge bigger rivals

* Total loans grow to 1.16 bln stg, up 216 pct

* Bank makes second quarter loss of 9.9 mln stg

LONDON, July 23 (Reuters) - Britain's Metro Bank said onWednesday its lending had more than trebled at the end of thesecond quarter compared with a year earlier, and more than halfof its lending was to businesses.

Founded by U.S. entrepreneur Vernon Hill, the bank has beenchampioned as an alternative to Britain's 'big four' lenders -Lloyds Banking Group, Royal Bank of Scotland,Barclays and HSBC.

British lawmakers and regulators want to stimulatecompetition within the industry and the country's competitionwatchdog last week set out plans for an investigation intobanking services for small business and individuals.

Metro Bank, which launched in 2010 as Britain's first newhigh street lender for more than a century, said its lendingamounted to 1.16 billion pounds ($2 billion) at the end of June,up 216 percent year on year. Customer deposits increased to 1.96billion pounds, up 125 percent.

"Strong growth in lending and deposits continues todemonstrate that the British people need and want a choice aboutwhere they do their banking, and we're here to provide that,"said Chief Executive Craig Donaldson.

Metro Bank has 27 branches in London and the southeast ofEngland, with 5 more due to open this year. However, it has yetto make a profit.

The bank made a loss of 9.9 million pounds in the secondquarter, which it said was due to investment in new staff,branches and technology.

($1 = 0.5857 British Pounds) (Reporting by Matt Scuffham; editing by Jason Neely)