Metro Bank, founded in 2010 as the first new high-street bank in the UK in over a century, fell to the bottom of the Competition and Markets Authority's service quality league table in August 2019. In that survey, it ranked 16th out of 16 for overall service quality for personal current accounts in Great Britain. The decline was not gradual. It followed the disclosure in January 2019 of a £900 million miscalculation in the bank's risk-weighted assets, a regulatory investigation, and the resignation of founder and chairman Vernon Hill in October 2019. By late 2019, the bank's share price had dropped from over 3,000 pence in 2018 to below 200 pence.
The CMA publishes biannual league tables for personal and business current accounts, ranking banks on metrics including online banking, overdrafts, and branch services. Metro Bank's last-place finish in the August 2019 survey marked a sharp reversal for a bank that had built its brand on customer service, extended branch hours, and a high-street presence. The outcome of the crisis was a £925 million rescue deal completed in November 2023, which handed majority control to Colombian billionaire Jaime Gilinski Bacal and stabilized the bank's finances.
The Accounting Error That Started the Slide
In January 2019, Metro Bank disclosed that it had misclassified £900 million of commercial property loans and buy-to-let mortgages, understating its risk-weighted assets. The error meant the bank had reported a higher capital ratio than it actually held. The Prudential Regulation Authority and the Financial Conduct Authority opened investigations. In December 2021, the PRA fined Metro Bank £10 million for providing inaccurate information to investors. The fine was the first the PRA had issued under its new penalty regime for individuals and firms.
The disclosure destroyed investor confidence in the bank's management and controls. Metro Bank's share price, which had traded above 3,000 pence in 2018, collapsed to below 200 pence by late 2019. The market reaction was not limited to the stock. Depositors and business customers began to question the bank's stability, and the CMA's August 2019 league table captured the resulting service deterioration. The bank that had once ranked among the top challengers for customer satisfaction now sat at the bottom of the official rankings.
Regulatory Fallout and Board Changes
Vernon Hill, the bank's co-founder and chairman, stepped down in October 2019. Hill had been the public face of Metro Bank since its launch, and his departure was a direct consequence of the accounting scandal and the bank's falling market position. The board began a search for a new chairman and chief executive, but the reputational damage had already been done. The PRA and FCA investigations continued, and the December 2021 fine of £10 million formalised the regulator's finding that Metro Bank had misled the market.
The regulatory findings did more than impose a financial penalty. They forced the bank to hold more capital against its commercial property book, which reduced its ability to lend and grow. The bank's cost of funding rose as wholesale lenders demanded higher rates to compensate for the perceived risk. Metro Bank's competitive position against established high-street banks such as Lloyds, Barclays, and NatWest weakened further. Those banks, with larger balance sheets and more diversified funding, could absorb the regulatory pressure more easily.
The Rescue Deal and Change of Control
By October 2023, Metro Bank's position had become unsustainable. The bank's share price had not recovered, and it faced a funding gap that threatened its ability to operate as a going concern. On October 8, 2023, Metro Bank announced a £925 million rescue package. The deal comprised a £325 million capital raise and £600 million of debt refinancing. The capital was provided by a group of investors led by Jaime Gilinski Bacal, a Colombian billionaire who had previously built a stake in the bank. Gilinski Bacal took a 53% stake, becoming the majority shareholder and effectively taking control of the bank.
The rescue was completed in November 2023, averting a potential collapse or forced sale by the Bank of England. The deal diluted existing shareholders almost completely, but it stabilised the bank's balance sheet and allowed it to continue operating. The Bank of England and the PRA supported the transaction, viewing it as the least disruptive option for the UK banking system. Metro Bank's survival meant that it remained a competitor in the high-street market, but its position in the league tables and its reputation for service quality had not recovered by the time the deal closed.
What the Decline Means for Metro Bank's Future
Metro Bank's fall to the bottom of the CMA's service quality league table in August 2019 was not an isolated event. It was the visible symptom of a deeper crisis that began with a £900 million accounting error, continued through a regulatory investigation and a £10 million fine, and ended with the departure of the founder and a change of control. The bank's share price collapse from over 3,000 pence to under 200 pence reflected a loss of investor trust that the rescue deal did not immediately restore.
The bank's future competitive position depends on whether the new majority owner, Jaime Gilinski Bacal, can rebuild the service culture that Metro Bank was known for before 2019. The bank's branch network and extended hours remain differentiators, but the regulatory burden and the cost of funding are higher than they were a decade ago. The CMA league tables will continue to measure service quality, and Metro Bank will need to improve its scores to regain customer and investor confidence. As of November 2023, when the rescue deal was completed, the bank had not yet recovered its pre-crisis standing in the official rankings.
Key Facts
- Founded: 2010, as the first new high-street bank in the UK in over 100 years
- Risk-weighted asset error disclosed: January 2019, £900 million miscalculation
- CMA league table ranking (August 2019): 16th out of 16 for personal current accounts
- Share price decline: From over 3,000 pence (2018) to below 200 pence (late 2019)
- PRA fine: £10 million, December 2021
- Chairman resignation: Vernon Hill, October 2019
- Rescue deal: £925 million, completed November 2023
- Majority shareholder: Jaime Gilinski Bacal, 53% stake
Metro Bank's CMA Service Quality Ranking History
| Survey Date | Rank (out of 16) | Context |
|---|---|---|
| August 2019 | 16th | After risk-weighted asset error disclosure; Vernon Hill resigned two months later |
| Pre-2019 surveys | Not in brief | Bank had been among top challengers for service quality before the accounting error |
Frequently Asked Questions
Why did Metro Bank fall to the bottom of the CMA league table?
The bank's service quality collapsed after the January 2019 disclosure of a £900 million risk-weighted asset miscalculation, which triggered a regulatory investigation, a fine, and a loss of customer and investor confidence.
Who took over Metro Bank after the rescue deal?
Colombian billionaire Jaime Gilinski Bacal became the majority shareholder with a 53% stake as part of the £925 million rescue deal completed in November 2023.
Did Metro Bank recover its service quality ranking after 2019?
The bank had not recovered its pre-crisis standing by the time of the rescue deal in November 2023.
