Bank reports record corporate lending and lowest cost of deposits among UK high street competitors, signaling successful execution of turnaround strategy
LONDON: Metro Bank Holdings PLC on Wednesday reported strong financial performance for the first half of 2025, with profits more than tripling due to strategic actions that included increased lending and reduced operating costs.
The bank, which is celebrating its 15th anniversary, reported an underlying profit before tax of £45 million for the six months ending June 30, 2025. This is more than three times the profit from the second half of 2024.
Revenue for the period was up 22% year-on-year to £286 million, while operating costs were down 8%. The bank also saw a significant increase in its exit net interest margin, which rose 117 basis points year-on-year to 2.95% at the end of June. Its cost of deposits, at 1.02%, was the lowest among all U.K. high street banks.
Metro Bank CEO Daniel Frumkin attributed the results to the successful execution of the bank’s strategy.
“We trebled profits, doubled new lending to corporate, commercial and SME customers, meaningfully reduced operating costs and optimized funding to have the lowest cost of deposits of any UK high street bank,” Frumkin said in a statement.
The bank originated a record £1 billion in new corporate, commercial and small-to-medium enterprise (SME) lending in the first half of the year, double the amount from the same period in 2024. It also has a credit-approved pipeline of £800 million for the second half of 2025.
Frumkin said the bank’s “unique relationship-led model, specialist lending expertise and expanding store network” are key differentiators that fuel its growth.
Looking ahead, Metro Bank reaffirmed its guidance, stating it has a clear path to achieving a mid-to-upper teens return on tangible equity (RoTE) by 2027.
Frumkin noted that the bank’s cost of deposits and operating costs are already below the levels needed to meet those 2027 targets. The bank also expects to benefit from changes to the MREL (minimum requirement for own funds and eligible liabilities) regime.