In its first quarterly report of 2017, Metro Bank recorded 33% growth in underlying profit before tax, hitting £2m ($2.56m) from £1.5m at the end of 2016
In addition, there was record deposit growth which exceeded £1bn for the first time. Deposits rose 13% quarter-on-quarter to £9bn while the actual cost of deposits fell from 66bp in 2016 to 61bp in Q1 2017.
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Speaking to RBI, Metro Bank founder and chairman Vernon Hill said: “We like to focus on deposit growth per store per month and that is £7.4m. That’s the highest it’s been for Metro Bank. That’s $113m a year. The average in America is $1m. We’re getting that growth with the cost of our deposits going down. You’re getting this tremendous growth while also lowering the cost of products.”
Customer accounts grew by 72,000 to reach 987,000, but Hill expected that number to be closer to a million by the end of the week.
One offering Metro Bank has that is sorely lacking in the banking sector is safe deposit boxes, which are a popular product.
Hill said: “Safe deposit rental covers 83% of our base store rent. That is a monumental number. Not only do we have the highest price locations in the highest price city, but in America, safe deposit box income is 1% of revenue income. The penetration, due to us being the only player, is very high.
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By GlobalData“Our longer term plan is that safe deposit boxes will be more than 100% of our base rent.”
