Challenger bank Metro cut its losses to £8.9m in the final quarter of 2014 as it edges towards profitability, its financial results showed yesterday.
That compares with £9.4m in the previous three-month period. The bank hopes to break even later this year, and is looking to float on the stock market in 2016.
Metro said the losses reflect its ongoing investment in new branches, or stores as it calls them, and it plans to open another 10 in 2015.
It now has 31 sites across London and the south east.
The bank, set up by Vernon Hill in 2010, grew lending by 112 per cent, increasing its total loans to £1.6bn. Almost half of those loans went to business customers, the bank said.
Deposits grew even more quickly with year on year growth of 118 per cent taking the total to £2.9bn.
Headcount expanded by 500 over the year to 1,500, and the bank expects to hire another 500 over the coming 12 months.
“Throughout the year we saw substantial growth in deposits and lending and the number of personal and business customers joining the banking revolution has continued to increase,” said chief executive Craig Donaldson.
Metro Bank has been championed as an alternative to Britain’s big four lenders – Lloyds, RBS, Barclays and HSBC – which account for more than 75 per cent of Britain’s 65m personal accounts and provide nine out of every 10 business loans. The competition watchdog is looking at the industry and regulators are keen to encourage new entrants.