Member Info for zccax77

The problem is the head office costs, where 2,000 people are employed. They have their head office and call centres in London. All those expensive London salaries and rents need to be somehow paid for.

If another bank acquired them the synergies would be immense. £200m, plus if that bank has AIRB then they can become more thinly capitalised they would be able to generate another £150m of profits.

It is crazy that there is no other bank willing to come forward and take this wreck on.

I like to check what Metro are offering their fixed term depositors since that is an indicator how their future NIM will develop as well as how deposit inflows are performing, here are my stats over the last three months for the 1 year fixed term deposit:
15 May 2020: 1.20%
11 June 2020: 1.00%
26 June 2020: 0.80%
This is a clear trend that they are slowly trying to increase NIM and at the same time moderate deposit inflows. I am hoping we will get a positive surprise in the H1 trading update.

I think MTRO has worse medium term problems. VMUK has a balance sheet which is 400% of what MTRO has but for some reason their occupancy costs are the same as MTRO. Hill's wife scr*wed this company over and now no one wants to buy it. This is not a bank but a retail property company with a bank as a side business. The only way out is AIRB approval, Zopa recently got approval as a bank why can't the PRA give MTRO a free pass well?

The drop here is no difference to the drop in price of VMUK and OSB. I am not sure why some posters think there is some kind of conspiracy in the background. Some of you need to relax.

Their travel business was burning the same amount of cash back in early April as it is doing now - £7m-£10m. They have not used the furlough scheme for their customer/call centre and head office staff. There is no way they are coming out of this with the £30m of cash, £50m of RCF, and £23m from bennetts if sailings get postponed to 2021. In 3 months we will now what the rights issue is. The BoD need sacking, look at the carp here and compare to what IAG are doing, never let a crisis go to waste.

No one ever wants to buy when markets are down.

I don't think they will be making a profit this year. What I cannot understand is why they did not use the Furlough scheme and save themselves £50m+. The BoD in this thing are a bunch of bafoons. I am now expecting a rights issue in the next quarter when they run out of money.

Problem is the current owners want MTRO to take the bad bits as well which is dealing with the old punters. That can turn ugly when loan start paying pennies in the £.

Metro have the most conservative loan book amongst all the banks. Everything apart from £200m is tied down to something tangible. Why would they go out and sign up for £850m of unsecured loans which can blow up in the next 12 months.

There are ways to hive off the old business by putting it into run-off and Metro only using platform for new lending.

The client base is not an asset but a liability. Best avoided.

He is still laughing at the mess he has created.

Metro should get Ratesetters technology for £1. Not sure why they are expecting £45-50m. Ratesetter will go bust in the next 12 months.

Metro, under new management, is keen on Ratesetter’s technology but is not interested in buying out the current £850 million loan book.

Hopefully they go back in and buy the platform and not the bad loans.

While the world and their dog are reducing their store footprint. MTRO are opening 5,000 sq ft branches. This one they brought outright for £10m though.

Sheffield, that is another £2m added to their cost base. Great Work BoD!

Will the BoD surprise us tomorrow as many other companies have done with Covid-19?

This is my take on your questions:
Ratesetter: This is a distressed sale, the FCA have probably given their blessing and I very much think MTRO is RS's lifeboat, so the FCA/PRA have likely promised to scratched MTRO's back in return. This deal will hugely benefit MTRO in scaling and reducing their own cost base.

JPM: I would ignore this, JPM are swing traders and I expect them to be out at the end of July at the latest.

JPM will disappear in a few days. They are just swing traders.