Metro Bank Co-founder and Chairman Vernon Hill stepped down as chairman on Wednesday (Oct. 23) after the bank reported a net loss of £4.9 million ($6.3 million USD) for the third quarter. As the financial institution (FI) works on a plan to cut costs, CEO Craig Donaldson said the firm would not rule out accepting a takeover.
“We are focused on an organic way forward, but … should something occur, we will treat it with the right respect, because that’s the fiduciary duty of the board,” Donaldson told analysts, according to the Financial Times.
Earlier this year, Metro Bank revealed an accounting error that kicked off a rocky year, and led some of its top clients to leave the bank. Metro’s stock has fallen nearly 90 percent over the course of this year.
The company’s third-quarter loss rose from £1.2 million in the previous quarter, but is on target with a £10 million profit from the same period last year. The bank also jettisoned a £250 million bond issue in late September, which led customers to make net deposit withdrawals of £213 million for the month. Metro Bank did, however, carry out the deal the following week after offering a higher interest rate.
While overall customer deposits increased £428 million over the third quarter to £14.2 billion, it was well below the £15.7 billion the FI hit at the end of last year.
Michael Snyder, the bank’s senior independent director, will take over as chairman on an interim basis, subject to regulatory approval. Hill will be given the position of emeritus chairman, “an honorary title to recognize Vernon’s extraordinary contribution to Metro Bank.”
“The board thanks Vernon for his vision, which inspired and created Metro Bank 10 years ago. He leaves a lasting legacy of creating fans through exceptional customer service, and has revolutionized British banking,” said Snyder in a press release.
Hill added, “I wish all of our fans — Metro Bank’s customers, colleagues and shareholders — every success for the next stage of the journey. As always, the best is yet to come.”