Yahoo Finance Metro promises to win even after CYBG and Virgin Money merger
Metro Bank chief executive Craig Donaldson on Wednesday said the merger of CYBG and Virgin Money would have no impact on his business, and he is unlikely to pursue a similar deal.
The combined CYBG/Virgin Money is expected to be a strong challenger, directly competing with Metro Bank for business customers in particular. Donaldson said: “I don’t know if it means anything for us. I can understand why they did it. But we have no legacy technology. I think it is better to grow organically.”
He said the new bank would have to place too much “focus and effort” on the merger, inevitably distracting from growth.
He was talking a day after a £300 million share placing which took the City by surprise. Donaldson had earlier claimed that he had no plans to raise more equity but said rapid growth made it the right move. “We had shareholders saying ‘do it now’,” he said.
The share placing is at yesterday’s closing price of 3422p, with chairman Vernon Hill planning to buy £10 million worth. Donaldson said that the colourful, dog-loving founder remains “bombastic and joyous”.
Shares today fell 154p to 3268p. Donaldson thinks Metro is in poll position to win some of the Williams & Glynn money available from Royal Bank of Scotland to lend to small firms.
“We have proved we can enter new markets,” he said. “We expect Metro Bank to be one of the winners.”
