Metro Bank’s share price jumped in trading today after the embattled lender revealed the succesful relaunch of a £250m bond issue and the planned departure of chairman Vernon Hill.
Shares in the group climbed 30 per cent to 234p in trading this afternoon as investors reacted to the firm’s double announcement.
The challenger bank had previously announced that Hill would step down as chairman, though no date was given.
Now, however, Metro Bank’s colourful executive will also give up his president and non-executive director roles as he and the bank cut ties.
Metro Bank also said it had raised in excess of £475m for its £300m bond.
“The board’s search for a new chairperson is progressing well. However, if this is not completed by the end of the year, the Bank will appoint an existing independent non-executive director as interim chairperson,” the firm said in a statement.
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“Vernon is the inspiration behind Metro Bank, the first high street bank to open in the UK in over 100 years,” said senior independent Metro Bank director Sir Michael Snyder.
The news comes amid a radical shake-up in the managerial ranks of Metro Bank, which have come under scrutiny from shareholders after a turbulent six months.
At the start of the year a wave of investor panic loomed large over the group following a major accountancy mistake that led to the dog-friendly challenger bank making an emergency cash call and rushing out its full-year results.
Shares in the FTSE lender have since plunged from over 2,200p in January to 180p this week, crashing by more than 90 per cent.
Last week the under-fire lender was forced to ditch a £250m bond issue after investors showed little demand for the debt despite the sizeable yield Metro Bank had offered.
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Barclays analyst Aman Rakkar said last week that the failed issuance meant there was “an increasing likelihood – and need – for Metro to dispose of ‘non-core’ assets”.He said asset sales could reduce the size of bonds that Metro Bank needs to issue and could “potentially sizeably boost capital at the expense of earnings”.
Activist investors are interested in buying an equity stake or new debt in a private placement, the Sunday Times said.