Source says UK bank regulator still pushing for Metro plan by Monday


File photo: People passing by Metro Bank in London

People walk past Metro Bank in London, Britain, May 22, 2019. Reuters/Hannah Mackey/File Photo Get licensing rights

LONDON, Oct 8 (Reuters) – Britain’s Prudential Regulation Authority (PRA) is still working with troubled Metro Bank (MTRO.L) to submit a plan by Monday morning that would allow the lender to shore up its balance sheet. Can do it or find a buyer. A person with knowledge of the situation.

The PRA has in recent days invited major UK lenders including HSBC (HSBA.L) and Lloyds (LLOY.L) to submit an offer for the lender, the person said.

People familiar with the matter also told Reuters that Shawbrook is considering a possible new bid for London-listed Metro Bank after several failed attempts earlier in the year.

The Financial Times reported earlier on Sunday that JPMorgan (JPM.N) had studied a bid for the metro before opting not to proceed, while Sky News reported that Santander (SAN.MC) had considered a potential offer. Consulting firm Robbie Warshaw was hired to work on the project.

The PRA, HSBC, Shawbrook and JP Morgan declined to comment. Metro Bank, Lloyds and Symantec did not immediately respond to requests for comment.

Metro Bank has seen its shares fall after news emerged that it had hired consultants to strengthen its balance sheet after failing to secure major capital relief from banking regulators.

The bank is exploring options to raise up to 600 million pounds ($734.28 million) of capital through equity and debt injections and asset sales.

Metro Bank on Thursday said its options include a combination of equity and debt issuance as well as refinancing and asset sales. It said it has met its minimum capital requirements and has not taken any decisions on fundraising plans.

While Metro Bank’s customer deposits, like other UK banks, are backed by a government guarantee of up to £85,000, the regulator is keen to ensure the concerns do not spread.

Reporting by Elisa Martinuzzi, Pablo Mayo Cerquerio, Ian Withers and Amy-Jo Crowley Editing by Bernadette Baum and Russ Russell

Our Standards: The Thomson Reuters Trust Principles.

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As part of the Reuters Deals team, Pablo covers equity and debt capital markets transactions across Europe, the Middle East and Africa, from initial public offerings to buyout financings. He previously worked at Mergermarket, Euromoney and Spanish Digital Media. Contact: +447721821589

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