Losses continued to widen at Metro Bank as one of the newest entrants to UK retail banking counted the cost of rapidly expanding its branch network.
The bank made a pre-tax loss of £45.7m last year. It made a further £8.8m loss for the first three months of 2013.
The figures take Metro Bank’s total pre-tax losses to more than £100m in the three years since its launch.
The bank said the losses reflected the investment required to fit out new stores and build accompanying infrastructure and operating systems. It will open its 18th branch this week and wants numbers to reach 200 by 2020, but the cost of opening each outlet costs more than £2m. The bank made a pre-tax loss of £33.1m in 2011.
However its extended opening hours and the promise of better service continued to prove popular with customers, with account numbers almost tripling to 136,000 last year. It now opens more than 10,000 new accounts each month. Customer deposits grew 279 per cent to £576m.
Metro Bank’s expansion, focused on London and the southeast, was aided by the £126m it raised from investors last June. The bank wants to list in London as early as next year.
Craig Donaldson, chief executive, said: “We’ve significantly expanded our reach throughout London and the surrounding areas, and as a result of a very successful round of fundraising, have been able to invest heavily in our network, technology and people.”
Nevertheless its fortunes were in sharp contrast with those of Aldermore, another ‘challenger bank’ but one which does not operate from branches, which reported results this week.
The bank recorded a full-year pre-tax profit for the first time in its three years of trading of £800,000 for the 12 months to December 31, up from a loss of £900,000 in 2011.
The bank was launched in 2009, growing out of Ruffler Bank, a lender bought by AnaCap Financial Partners, a London-based private equity group.
“We’ve grown at an impressive rate,” said Phillip Monks, Aldermore chief executive. Its balance sheet grew more than 60 per cent to just over £2.5bn, and the bank hopes this will reach £4bn by the end of 2013.
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