Metro completes £3bn mortgage sale to NatWest-RBS

Metro Bank said on Tuesday it completed the sale of a £3 billion residential mortgage portfolio to NatWest Group plc.

“Further to Metro Bank’s announcement on 18 December 2020 regarding the sale of a portfolio of owner occupied residential mortgages to NatWest, Metro Bank confirms that the sale completed on 2 February 2021 as expected,” said the bank.

“The portfolio had a gross book value of £3,044m resulting in a total cash consideration of £3,127 million.”

Metro Bank also announced the acquisition of the RateSetter back book.

In line with its strategy of increasing its exposure to unsecured personal lending, Metro Bank PLC today announces the acquisition of a portfolio of loans from peer-to-peer investors who have invested through the Retail Money Market Ltd (“RateSetter”) platform for a cash consideration of up to £384 million.

“The exact amount is expected to be less as the portfolio will continue to amortise between announcement and expected completion in April 2021, following a two month notice period for retail investors.

The portfolio had an aggregate book value of £384 million as at 29 January 2021, with an average total gross yield of circa 8%.

“The portfolio consists primarily of unsecured consumer loans and is amortising rapidly, with an average weighted loan term of 2 years remaining.

“It is a well-seasoned portfolio delivering a consistent credit performance.”

Metro Bank CEO Daniel Frumkin said: “The addition of this portfolio to our loan book is a further step towards growing our presence in the unsecured lending market.

“It builds on our acquisition of the RateSetter platform – a well-established business with a strong technology platform that is enabling us to rapidly expand our unsecured lending offering.

“We continue to deliver against Metro Bank’s strategic priority of optimising our balance sheet and asset mix, whilst positioning ourselves to better serve customer needs as the UK’s best community bank.”

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