Metro Bank shares plummet as lender misses profit expectations

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Metro Bank missed analysts' profit forecasts by £9m (Source: Getty)

Shares in Metro Bank dropped to their lowest point ever this morning as the lender warned that profits had “softened” in the final quarter of last year.

Underlying profits reached £50m in 2018, the banks said, up 138 per cent from the year before.

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However, the growth was not enough for the markets, missing analysts expectations by around £9m, Jefferies said.

Shares dropped as low as 33 per cent down to 1,463p this morning, an all-time low since the company listed in 2016.

The bank also warned that mistakes in the way it had calculated the weight of some commercial loans and buy-to-let loans to major landlords would take a chunk out of its risk-weighted assets.

On a call with analysts chief executive Craig Donaldson refused to say if the bank would have to ask shareholders for more cash in a bid to strengthen its buffers. However, the company “will look at all options to maximise shareholder return,” he said.

Assets increased 32 per cent to £21.7bn, loans grew 48 per cent to £14.2bn, while deposits in the bank rose 34 per cent to £15.7bn, Metro said this morning.

Underlying earnings per share rose 111 per cent to 40p.

“2018 was another strong year of growth for Metro Bank as we continued to invest in both new stores and digital capabilities,” Donaldson said.

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“Metro Bank remains well positioned to support our growth strategy as we navigate an uncertain period for the UK.”

The bank has lost over half its share value from highs of around 4,000p in March last year. It opened six new branches in the fourth quarter of last year and welcomed 100,000 new customers.