Metro Bank (MTRO.L) on Thursday announced sweeping cost-cutting plans aimed at bolstering its finances, which could see the embattled British lender lay off 20 per cent of its staff and axe some of its biggest customer perks including seven-day opening hours.
Metro, which this week received shareholder approval for a 925 million pound refinancing and recapitalisation plan backed by Colombian billionaire Jaime Gilinski, said it expected the cost reduction plan to deliver up to 50 million pounds ($63.45 million) of savings a year, with completion in the first quarter of 2024.
The lender expects to take a lower-than-expected one-off restructuring charge of between 10 million pounds and 15 million pounds in 2023.
Metro Bank did not immediately respond to a request for clarification on the precise number of roles at risk, but the lender employs around 4,000 people, according to its latest annual report.
Metro launched in 2010 to challenge the dominance of Britain’s big banks but hit a string of setbacks in recent years, such as accounting errors, leadership departures and delayed regulatory approval for key capital reliefs.
In addition to the jobs cull, the lender, famous for its centrally located branch network, said it would invest in automation for back-office operations and improving digital services.
It is also reviewing its seven-day opening and extended store hours and will “selectively streamline lending” to focus on relationship banking to maximise risk-adjusted returns.
“We remain committed to stores and the high street but will transition to a more cost-efficient business model while remaining focused on customer service,” Chief Executive Daniel Frumkin said in a statement.
Earlier this month, the bank said it saw a 5 per cent drop in deposits in the third quarter but that outflows had returned to “more normal ranges” after its capital injection. Its shares have lost 68 per cent of their value so far this year.
Separately, it announced that three board members would step down at the end of the year, leaving the board with five non-executive and two executive directors.