Member Info for mt11

Having said that the Bank's shares might find its way to 30p due to general downward trend in the markets for other reasons. Gloomy outlook and poor sentiment is setting in.

No one has the 30p shares yet. Metro Bank needs to circulate the prospectus first and then get it voted through (which should be nodded through) before the shares are issued. The shares may be restricted for a period of time.

Likely to coast around this price until the next trading update around mid-November unless it starts looking like an acquisition target

The sale proceeds will be used for commercial lending which have higher yields, but also means higher risk.

Spaldy are smart, this isn't their first go at a bank, previous attempts were a success, so I think that lends some credibility to Metro. Really though... who knows.

Need a meaningful director buy - that's if they're not too busy trying to run it down in the hopes they can win a bidding war with big Mike. Having him as a investor might be a good thing. Really though... who knows.

In other news the press coverage is still largely negative leaning.

Very ambitious but not the best sales pitch I've heard - hopefully they turn this beast around.

Better still would be for Shawbrook to make an honest offer of at least a few hundred million which appeases the large shareholders as a way to cut their losses without totally looking like mugs, or at least let the offer stick around to boost up on the news so we can find an exit before this turns into an epic long term hold.

How do you think it'll be reflected in the new share price?

Without the deal it’s dead in the water, hence why they’ll vote for it.

Spaldy's average is roughly around 36p a share.

They are in profit on paper but unable to sell their holdings and crystallise their paper gains currently.

Verition Multi-Strategy Master Fund Ltd have dropped below 0.5%

The rest have not changed as per the latest update.

The next event that can help rerate is the trading update provided it shows negligible deposit movements and small impairments.

Yes, it's known. The only uncertainty is the discount it sells at. The sooner they sell it the sooner they can move on towards the new plan.

I'll preface this by saying I'm a long term holder.

Are you confident they will achieve the stated amounts in the event of disposing of their listed assets?

They were not forced to ask the regulators to adjust anything. They have been in the process of gaining AIRB accreditation which will allow them to use their internal models instead of the standard one-size fits all model. But they lack the data and to be totally honest the know how based on how it's gone. They sound like they are going to abandon trying to get AIRB, they are selling their mortgage book because it was built up in the way it has been with a view that they will gain AIRB. The f'd up thing is they announced it before they even got written feedback from BoE/PRA, this was also a break in the way they had conducted themselves up to that point, in as far as they previously refused to provide any details. It's like they wanted to burn it all down.

Metro Bank is now changing going for higher yield products which also means higher risk. It's a new strategy, maybe it pays off, maybe it doesn't.

Metro Bank is also pulling away from RateSetter type of consumer lending.

The biggest risk is they burn through the money with nothing to show for it because they are hellbent on opening a chain of new stores. I get that it helps them gain new accounts and deposits, after all there are large number of people who only bank with institutions that have a high street presence. The reason they might go for Metro over Lloyds for example is the customer service and inviting atmosphere (subjective). This approach is expensive and if you wind up opening in the wrong areas then it's very costly.

Worth noting that Spaldy may not care, what they invested is a lot of money generally but contextually it's low single digit percentage of their available resources.

How are you calculating that?

We STILL live in hope :)

Nope. 53% is majority control. Full control is 100% ownership. Either way, this is a regulated sector there are strict governance rules. The bondholders will have break clauses in the event the ownership changes.

It’s not great to have a party with a controlling interest. However, this is where an effective board would work wonders. It would also be harmful for the bank if they started trying to sell assets as it interferes with the risk weightings, the PRA would pounce in that situation.

Shawbrook Bank should make a public offer if they are still interested. It would be a tough for the board to reject an offer close to what Shawbrook offered for Co-Op Bank.