Metro Bank about to bomb?
Discussion
DanL said:
I’d think they’ll be fine. They do need to raise some funds, it seems, but I’d think they’ll be able to.
That's positivity for you.Valued at 65mill (down from 3.2billion 5 years ago), with a 600mill black hole looming. That's one he'll of a whip round to pull from friends and family. They are having to offload a lot of assets to do that, given their regulatory issues they are going to struggle with higher yielding credits. Then there's the cost base / branch network.....
I've got a current account with them that I used to use abroad, but I now have Monzo for that, But I kept it because our local branch doesn't require you to pay for parking, where as my local main bank (Barclays) you have to pay to park to visit.
I have £40 in my account, and my 15 month old lad has £100 in his saving account, worth pulling it out? will need to find somebody else who allows a childs savings account to be opened.
I have £40 in my account, and my 15 month old lad has £100 in his saving account, worth pulling it out? will need to find somebody else who allows a childs savings account to be opened.
the-norseman said:
I've got a current account with them that I used to use abroad, but I now have Monzo for that, But I kept it because our local branch doesn't require you to pay for parking, where as my local main bank (Barclays) you have to pay to park to visit.
How often do you visit the branch and how much is the parking?I think I've visited the inside of a bank (other than a cash machine) once in the last 25 years. Parking seems like a strange reason to choose a bank.
markiii said:
It's covered by FCS, and those numbers I'd leave it be
It's still hassle though. And not worth the inconvenience of waiting for your money to be returned. When there are much safer alternatives I have no idea why anyone would want to risk staying with Metro. For peace of mind just move it.Phooey said:
It's still hassle though. And not worth the inconvenience of waiting for your money to be returned. When there are much safer alternatives I have no idea why anyone would want to risk staying with Metro. For peace of mind just move it.
And if everyone does that, there definitely won't be a problem.outnumbered said:
Phooey said:
It's still hassle though. And not worth the inconvenience of waiting for your money to be returned. When there are much safer alternatives I have no idea why anyone would want to risk staying with Metro. For peace of mind just move it.
And if everyone does that, there definitely won't be a problem.IF there is an issue and they let depositors under the FSCS amount take a hit, the entire bank system will go under as everyone rushes to empty accounts.
The entire idea is you keep the faith, and in doing so you avoid these issues.
Just look to USA snd FDIC with SVB etc.
All deposits protected even over the FDIC limits.
Mr Whippy said:
I’m baffled.
IF there is an issue and they let depositors under the FSCS amount take a hit, the entire bank system will go under as everyone rushes to empty accounts.
The entire idea is you keep the faith, and in doing so you avoid these issues.
Just look to USA snd FDIC with SVB etc.
All deposits protected even over the FDIC limits.
You should know this.IF there is an issue and they let depositors under the FSCS amount take a hit, the entire bank system will go under as everyone rushes to empty accounts.
The entire idea is you keep the faith, and in doing so you avoid these issues.
Just look to USA snd FDIC with SVB etc.
All deposits protected even over the FDIC limits.
SVB got saved as wider contagion was a serious concern. The US banking system is 2 tier, SVB was allowed ro get away with stuff Chase and Co can't. They are now reversing this.
Metro is systemically irrelevant. It has 1.3-1.6mill depositors and is in the s
t because of their own incompetence. FSCS will be there IF it fails, but no reason to go above the limit. Even if they are basically worthless, they will probably limp on until someone sensible gets involved. Either that or a challenger who can't afford disruption at this end of the market. At 60-70mill the likes of Atom or Oaknorth should be stepping up. They need to raise capital (expensive), slash cost and offload the dodgy risk. The jokes business model (branches, newspapers and free parking) is done. If a name like those given step in agreeing to slash the cost, they'd get better funding cost in the capital instruments needed.
xx99xx said:
How often do you visit the branch and how much is the parking?
I think I've visited the inside of a bank (other than a cash machine) once in the last 25 years. Parking seems like a strange reason to choose a bank.
It wasn't the main reason, the main reason was the fact that the card could be used in Europe for free, but I've since opened a Monzo account. I think I've visited the inside of a bank (other than a cash machine) once in the last 25 years. Parking seems like a strange reason to choose a bank.
Probably should be some form of answer later today. Basic hoped for deal, convert 250m Tier 2 capital bond holders to Equity (basically a bail in). Extend 350m of senior bonds due 2025, into the long grass.
Still think they will need to do something serious on cost and business model....
Still think they will need to do something serious on cost and business model....
Edited by OoopsVoss on Sunday 8th October 07:29
the-norseman said:
It wasn't the main reason, the main reason was the fact that the card could be used in Europe for free, but I've since opened a Monzo account.
Halifax have done a card for years which you can use in Europe - and around the world - for free, and it also gives you the protection of a credit card. I've yet to see what Monzo offers above that, but it seems to very popular. Anyway, Metro Bank - great idea from a customer's perspective, but a terrible business model. Because it's so easy to open accounts and make changes etc they get used by people for their "casual" banking, which is very hard to make any money from. If someone moves £500 a month in and out their account the cost of servicing that account is going to be far more than the income it brings. I suspect there are very few people who use it as a "main" bank.
markiii said:
It's covered by FCS, and those numbers I'd leave it be
I'm always a little nervous of this. It's a sort of 'naaa, it'll be fine' insurance policy.Let's say several large financial institutions collapsed...there isn't an equivalent pot of money waiting to be paid back at the FCS. A lot of people would lose significant ammounts money.
I've got a modest amount of savings, but diversity is the key. Either way, don't put all your eggs in one basket, and don't just assume all will be fine if the FCS has to step in.
Condi said:
Anyway, Metro Bank - great idea from a customer's perspective, but a terrible business model. Because it's so easy to open accounts and make changes etc they get used by people for their "casual" banking, which is very hard to make any money from. If someone moves £500 a month in and out their account the cost of servicing that account is going to be far more than the income it brings. I suspect there are very few people who use it as a "main" bank.
That's how I use all my current accounts. Nothing stays there longer than it has toEdited by markiii on Sunday 8th October 16:07
OoopsVoss said:
Mr Whippy said:
I’m baffled.
IF there is an issue and they let depositors under the FSCS amount take a hit, the entire bank system will go under as everyone rushes to empty accounts.
The entire idea is you keep the faith, and in doing so you avoid these issues.
Just look to USA snd FDIC with SVB etc.
All deposits protected even over the FDIC limits.
You should know this.IF there is an issue and they let depositors under the FSCS amount take a hit, the entire bank system will go under as everyone rushes to empty accounts.
The entire idea is you keep the faith, and in doing so you avoid these issues.
Just look to USA snd FDIC with SVB etc.
All deposits protected even over the FDIC limits.
SVB got saved as wider contagion was a serious concern. The US banking system is 2 tier, SVB was allowed ro get away with stuff Chase and Co can't. They are now reversing this.
Metro is systemically irrelevant. It has 1.3-1.6mill depositors and is in the s
t because of their own incompetence. FSCS will be there IF it fails, but no reason to go above the limit. Even if they are basically worthless, they will probably limp on until someone sensible gets involved. Either that or a challenger who can't afford disruption at this end of the market. At 60-70mill the likes of Atom or Oaknorth should be stepping up. They need to raise capital (expensive), slash cost and offload the dodgy risk. The jokes business model (branches, newspapers and free parking) is done. If a name like those given step in agreeing to slash the cost, they'd get better funding cost in the capital instruments needed.
If you know you’ll be protected you don’t run on the bank… thus you don’t “need” the protection.
In SVBs case wasn’t it the ‘tech’ scene who’d dropped all their VC money in there that caused problems because of deposits over FDIC limits, thus they all got bailed?
Ie, those businesses would have folded rapidly and caused all sorts of economic chaos.
A bit TBTF… but also a bit stupid of the depositors.
In any case, layman position, who cares?
It’s either not a problem, or if it is, the whole system is gonna lock up and go to s
t, so it’s irrelevant.All that matters is you don’t have over FSCS limit and government will make you whole.
If they don’t, well I’d argue that we’re back to the idea the whole system has gone to s
t, so it’s irrelevant.If it’s Metro in the morning in that scenario, it’s the rest in the afternoon.
By that point you’re a jibbering gold/crypto/prepper.
Timothy Bucktu said:
markiii said:
It's covered by FCS, and those numbers I'd leave it be
I'm always a little nervous of this. It's a sort of 'naaa, it'll be fine' insurance policy.Let's say several large financial institutions collapsed...there isn't an equivalent pot of money waiting to be paid back at the FCS. A lot of people would lose significant ammounts money.
I've got a modest amount of savings, but diversity is the key. Either way, don't put all your eggs in one basket, and don't just assume all will be fine if the FCS has to step in.
All banks will suddenly get a run, shares crash, bonds worthless. Tits up.
It won’t happen.
And if it does, nowhere is safe any way.
Even using 10 institutions and 10 pension providers, it’ll all lock up and go to crap.
Which is why it won’t. And as said, if it does, we can break out our physical gold and bitcoin and live like kings!!!
Coincidentally, Metro Bank joins Aston Martin in the 90% Club.
Aston Martin have been trying to make a profit, since incorporation in 1913. Managed it on a couple of occasions.
Last years pre tax loss was £495 million, but hey ho, press on chaps.
It has gone bust many times, but the clever part is, on every occasion someone with deep pockets and a passion for sports cars and motor racing has appeared.
Is there passion for Metro Bank?
If so, they might also be able to celebrate their centenary.
Edited by Jon39 on Sunday 8th October 16:40
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