Metro Bank Q3 2019 earnings highlight the challenger bank’s ongoing challenges following its accounting imbroglio in the first quarter.

For the quarter to end September, Metro Bank reports an underlying loss before tax of £2.2m. In the year ago quarter, Metro Bank posted an underlying pre-tax profit of £15.1m.

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The Metro Bank Q3 2019 results include a one-off charge of £2.5m following a portfolio disposal in July. Total underlying revenue is also down year-over-year by 5.3% to £99.4m.

Other less positive metrics include a y-o-y 24 basis points drop in the net interest margin to 1.58%.

Metro Bank Q3 2019 highlights

However, the third quarter results are not all negative with a number of positive metrics.

Total deposits rise by 4% over the prior quarter to £14.2bn although they are down by 4% y-o-y.

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And total loans are up by 13% y-o-y to £14.9bn. Total customer numbers are also up, by 106,000 in the third quarter to 1.9 million. This includes continued growth in personal current accounts and business current accounts.

Other highlights include asset quality. Cost of risk is 5 basis points in the third quarter, down 1 basis point from the prior quarter.

Nonperforming loans of £31m represent just 0.20% of the total loan portfolio (Q2 2019: 0.17%).

Cost control results in costs inching down to £99.7m in Q3 2019 from £100.3 million last quarter despite store openings.

On the other hand, the underlying cost-income ratio rises to 100% from 92% in the second quarter.

Looking ahead, Metro Bank says that it is ‘evaluating future growth plans to maximise returns’. This includes future expansion, cost initiatives and optimising capital efficiency.

Release of the Metro Bank Q3 2019 results follows news that founder Vernon Hill is standing down as chair. With immediate effect, non-executive director Michael Snyder is appointed interim chair.