Metro Bank shares soar as lender’s turnaround gathers pace
Metro Bank said there was a “significant increase” in quarter one profit against the second half of 2024 during a trading update on Thursday.
Shares in the bank jumped nearly four per cent during early trading.
The London-based firm said it was “confident” it would meet full-year targets after a “structurally higher” net interest margin, which indicates a bank’s profitability from lending.
Metro said the increased margin was driven by continued asset rotation and deposit optimisation.
This comes as the firm continues its pivot towards specialist mortgages and small business lending.
The lender added cost reduction efforts in 2025 were in line with expectations.
Metro sold its personal loan portfolio
Elsewhere, the firm posted a four per cent reduction of deposits to £13.8bn, down from £14.5bn at the end of 2024.
The bank cited “maturities of higher cost fixed-term deposits and continued focus on reducing excess liquidity and cost of deposits” as driving losses.
Total net loans fell six per cent from December 2024, which the lender said reflected a £584m sale of its personal loan portfolio.
The deal – with an undisclosed buyer – was confirmed in February 2025 and generated £11m in gains for the FTSE 250 bank.
Following the sale, Peel Hunt analysts said: “By downsizing exposure to legacy unsecured personal loans more rapidly than expected, Metro can free up funding and capital to scale up its commercial and corporate lending balances, which have higher risk-adjusted returns sooner than guided.”
Chief executive Daniel Frumkin commented on the update: “We have seen further growth in our corporate and commercial lending, with Metro Bank’s relationship banking and breadth of services creating differentiation for us in the market.”
“Looking ahead, we will continue to play an important role in supporting our customers as the UK focuses on delivering economic growth. We remain firmly on track to meet our guidance given at full year”.