Metro Bank posts second quarter of profitability on mortgage loans demand
(Reuters) - Metro Bank on Wednesday said it had reached underlying profitability for the second consecutive quarter, as net inflows picked up pace in March on a revival in demand for mortgage loans.
For Metro Bank, which in 2010 became the first lender to be granted a high-street banking licence in Britain in 150 years, the profitability status caps over two tumultuous years after an accounting scandal in 2019 prompted probes by UK regulators.
"March has been our strongest month of performance since the turnaround commenced," Chief Executive Daniel Frumkin said in a statement.
British banks have also seen a profit boost from successive rate hikes by the Bank of England, designed to curb rampant inflation, as they profit on the gap between what they charge on lending and pay out on deposits.
Retail mortgage lending increased marginally to 7.7 billion pounds in the three months ended March 31.
Metro Bank's first-quarter total deposits dropped, compared with the prior quarter, as the lender faced seasonal factors such as higher tax payments in January.
Total deposits stood at 15.6 billion pounds ($19.48 billion)in the first quarter, compared with 16.01 billion pounds in the three-month period ended Dec. 31.
Meanwhile, total loans remained broadly flat quarter-on-quarter at 12.92 billion pounds, on weak consumer and commercial lending.
($1 = 0.8010 pounds)
(Reporting by Eva Mathews in Bengaluru; Editing by Sherry Jacob-Phillips and Nivedita Bhattcharjee)