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Why raise more money if you have a payout on the way?

Hi All - Anyone got any thoughts as to why nothing was mentioned in the business update in regard to the SIPIEM claim?

https://twitter.com/fishwickdavid/status/1313398306912055298?s=21

Interesting!

What bit of his job isn’t he doing Bredleybear? Interested to hear your thoughts

Mtro expert group... it’s a Twitter account that has tweeted twice and has one follower?

Pmsl...

Able to buy at 9.74

Not buying that... if GS or JPM knocked on Metro’s door, Metro would answer... neither would have to buy shares to gain an audience.

Thanks for bearing with me folks...

So of the 21,400,000,000 in assets that I mentioned earlier...

2,989,000,000 is with the BOE ... therefore secure...
3,730,000,000 is other assets, likely real estate etc?
14,681,000,000 loans to customers... of this all but 4,135,000,000 is at a dtv of over 70%

Therefore, and I stand to be corrected,
The 3730 in other assets may be at risk in a property crash and the 4135 in the higher Ltv ratio would likely be impacted...

So 4135+3730=7865.. multiply by a 20% property crash you get 1573, which is more than the current shareholder funds of the business

I really want to be corrected on this but as the bank has zero value as a profit making business... it isn’t making a profit... then the value must be in the balance sheet and the shareholder funds...

But from what I can tell these could possibly be severely affected by Brexit and C19...

Thoughts...

Hi Theosus... thanks for the reply....

I think I probably used the wrong word when saying ‘impairment‘

Where I was trying to get to was the below type of scenario...

Say the bank have an asset on the balance sheet of a property loan to a customer, customer doesn’t keep up repayments and as a result the bank has to take possession and sell the property.

When Bank comes to sell the property the market has dropped and with selling costs and as a fire sale the bank is not going to recover the original loan value...

I presume this would hit retained earnings/shareholder funds in the year it happened... As a result lowering net assets per share?

Obviously totally hypothetical...

I would suggest that both sides of the house have valid points... as a LTI myself, I am nursing a considerable paper loss on this one, mainly due to the fact I only listened to one side and my own research was heavily biased...

I now enjoy listening to both sides and take care not to heed one side or the other... Both sides have some interesting points...

If this board was just one side or the other it would be a pretty boring place...

That is very interesting...Do you know why Natwest don’t want them?

Ps totally take your point on the secured lending... Metro have been prudent, however, these are really uncertain times and without delving really deep into the asset structure, we as investors need to also remain prudent.

Totally agree Zccax77, internally generated goodwill will not be recognized on the balance sheet..

Natwest were paying 175quid to each new customer that opened a current account recently... if that is the going rate then Metros 2m customers definitely have value!!

See earlier post...

Total assets are 21,400,000,000
Let’s say, hypothetically, that all of these assets are loans to customers, obviously they aren’t and the bank does have capital buffers etc... but say are they are loans and 7% go bad and aren’t repaid because people and business can’t afford to repay because of the affect of COVID on the economy.

Then this would equal 1,498,000,000...
This would pretty much wipe out the shareholder funds of 1,583,000,000.

So let us say that all assets are impaired by 7% given C19, that would mean that the shareholder funds would be totally wiped out.

...here it is as at 31 Dec 2019...

Total assets 21,400,000,000
Funded by:
Cust deposits 14,477,000,000
Other liabilities 5,340,000,000
Shareholder funds 1,583,000,000
Total...21,400,000,000

Therefore, take the share holder funds and divide by the 172,420,458 shares issued you end up with 9.18 per share...

Is that correct?

Just heard off my Cabbie mate again... he is stuck in a traffic jam in Upper Brook Street in Mayfair... lots of sirens apparently

Just as VMUK may be a great fit for Metro...

The volume indicates an RNS not a leak...

Ps... Always trust a cabbie.... Ronaldo would fit in great at QPR and would certainly strengthen us up front!!

Same Cabbie told me he dropped Ronaldo off at Loftus Road on the last day of the transfer season... hmmm...

Just heard from a London cabbie who says he has just dropped Branson off in Southampton Row.... could be something or nothing... hmmmm,