RateSetter helps Metro Bank’s consumer credit business grow by 256 pc

Metro Bank announced a 256% increase in the volume of its consumer credit business between the first half of 2020 and the first half of 2021, thanks to the bank’s acquisition of the peer-to-peer lending platform RateSetter l ‘last year.

According to Metro Bank’s latest financial update, £ 704million was provided through consumer loans in the six-month period ending June 30, 2021. This represents a 245% increase over loan figures for the year 2020 and a 256 percent year-over-year increase. year.

Total net lending reached £ 12.325 billion in the first six months of this year, an increase of 2% from full year 2020 results. However, commercial lending and mortgage lending activities of retail banking are both in decline.

The bank granted 11% fewer commercial loans between the first half of 2020 and the first half of 2021; and provided 33% fewer retail mortgages over the same period.

“Total net lending as of June 30, 2021 was £ 12.325 billion, up 2% from £ 12.09 billion as of December 31, 2020, mainly reflecting the portfolio acquisition of 337 million British Pound RateSetter Consumer in April, as well as strong organic growth in consumer loans. supported by the integration of the RateSetter platform, offset by the attrition of low yielding residential mortgages and commercial term loans, ”said Metro Bank.

Read more: Innovate Finance chief applauds strength of P2P lending industry during Covid

“Total net lending is expected to increase in the second half of the year, with the mix continuing to shift towards higher yielding assets. “

Consumer loans now represent 6% of the bank’s overall loan portfolio, up from 2% as of December 31, 2020.

This is the result of “the sharp increase in organic lending as the RateSetter platform was rolled out across all Metro Bank channels and the completion of the RateSetter backlog acquisition,” Metro said.

In its semi-annual financial report, Metro Bank said that acquiring RateSetter’s backlog helped accelerate the bank’s transition to higher-yielding assets. It is now repositioning its commercial lending activity towards full relationship retail activities, while the exit from transactional real estate loans is underway.

Overall, the bank recorded a statutory pre-tax loss of £ 138.9million in the first half of 2021, compared to a loss of £ 240million in the first half of 2020.

Read more: Metro Bank Completes Sale of RateSetter Auto Dealer Finance Loans

“In a difficult environment, Metro Bank continued to meet its strategic priorities,” said Daniel Frumkin, CEO of Metro Bank.

“As a community bank, our colleagues have gone above and beyond for our clients and we have enhanced product offerings to meet more of our clients’ needs.

“Financial performance reflects where we are in our recovery plan, as well as the impact of national bottlenecks.

“We are encouraged by the momentum we have achieved, including offering higher yield mortgage products, lower cost of deposits and significant entry into the personal loan market.

“Going forward, we remain focused on executing the plan and returning to profitable growth, achieving the bank’s strategic goals and supporting our colleagues, clients and communities.

Read more: Starling Bank to expand lending through mergers and acquisitions

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