With so much news surrounding banking this week, it’s a challenger that’s come out shining following a new investment
The EU Commission has come down on top of the big banks like a ton of bricks over so-called market-rigging that went on from 2007 to 2013. Barclays, RBS, Citigroup and JP Morgan were among those on the receiving end of a €1.07bn fine for an attempt to fix the foreign exchange market by synchronising trading strategies. But while these big players are being forced to pay out money, Metro Bank has just secured a significant amount.
The 2010-launched challenger bank sought to change the marketplace and became the first bank to launch on the UK high street for more than a century, doing things such as opening seven days a week. And seemingly, its services are in high demand as Metro Bank has secured a £375m investment from shareholders, well exceeding the £350m target.
The raise is a stark turnaround for Metro Bank, which earlier this week found itself caught up in a fake news furore following a rumour that circulated on WhatsApp that cautioned customers the bank was facing financial difficulties.
Commenting on the injection, Vernon Hill, chairman and founder at Metro Bank, said: "I am really pleased with the support we have received from both existing and new shareholders and for their confidence and belief in Metro Bank's strategy. The placing was significantly oversubscribed and as a consequence we raised a total of £375m.
“Although we've faced challenges in the past few months, we remain fully focused on providing the outstanding service and convenience that our customers expect of us. This growth capital will enable us to continue to expand the business and implement our strategic initiatives."
It’s not hard to see that challenger banks are an attractive proposition for investors. While Metro Bank is a prime example of that fact, so is digital-only player Starling Bank, which secured a £75m series C investment in February. With moves like these, seemingly the UK’s title of number one destination for fintech investments doesn’t seem to be going anywhere.