Metro Bank‘s board announced on November 12 its interest in a structured sale as part of a strategic review of options to accelerate growth.
The challenger bank said it is not in active discussions with any potential buyer and has received no approach. The board said there is no certainty any offer will be made or on what terms.
Shares in Metro Bank jumped 6% in morning trading on the news. Colombian billionaire Jaime Gilinski Bacal became majority shareholder in 2023 with a 53% stake, joining the board as a non-executive director.
Metro Bank’s announcement does not say whether his stake is for sale, whether he backs the process, or what part he has in it as a board member. Bidders must sign a non-disclosure and standstill agreement before they receive company information and are invited to submit proposals.
It was reported last year that Bacal was considering selling his shares after receiving interest from investors. The billionaire owner is a specialist bank turnaround investor who has previously bought, improved and exited lenders for gains.
Since taking over in 2023 the bank has shifted its business model and cut costs, making profit for the bank once again. Now the non-executive director could be looking to exit while he still can.
Who is Jamie Gilinski Bacal?
The Colombian billionaire and Harvard MBA began his career in Morgan Stanley’s mergers and acquisitions division. He established himself as a bank turnaround investor by acquiring distressed lenders, restructuring them and exiting at a profit.
In 1991 he bought the Colombian assets of the collapsed Bank of Credit and Commerce International, restructured them as Banco Andino and nearly quadrupled the assets before selling for a reported $70 million.
In 1994 he acquired Banco de Colombia for $365 million in Colombia’s then-largest privatisation, backed by investors including George Soros. He sold control three years later in a deal valued at $800 million, receiving $418 million for his stake. He later expanded the model through further acquisitions, including HSBC’s Latin American operations in 2012, to form the GNB Sudameris group.
The same approach underpinned his Metro Bank investment. He has framed the deal as consistent with a career of buying problem banks and improving their efficiency and returns, with the bank’s subsequent recovery now opening a potential exit path.
Metro’s restructuring
In 2023 Metro Bank faced a substantial capital shortfall after the Prudential Regulation Authority rejected its application to use internal models for regulatory capital calculations. The bank also had £350 million of bonds approaching maturity. When the news broke the share price fell sharply and deposits began to leave. Shareholders approved a £925 million funding package that formed the core of the restructuring.
The privately negotiated rescue injected new equity while bondholders absorbed losses. Metro issued 500 million new shares at 30p each, a 33% discount. Bacal’s Spaldy Investments committed £102 million, with smaller sums from other existing shareholders and new investors. His stake rose from 9.2% to 53%, giving him majority control. The roughly quadrupled share count imposed severe dilution on non-participants.
The package also refinanced £600 million of existing debt. Holders of £250 million in Tier 2 subordinated notes accepted a 40% haircut, freeing up £100 million in capital for the bank. That gain was booked as non-underlying income and left capital ratios comfortably above regulatory minimum.
By having bondholders take the haircut while equity value remained intact, Bacal secured control without immediately impairing his fresh investment. Spaldy was the only large, committed source of new equity at a moment when the bank required capital urgently. Its participation was effectively conditional on equity not being wiped out.
Without the £102 million the package would not have closed in time, giving Bacal the leverage to insist the capital structure retain equity value afterwards. The deal was the only viable private solution that could be executed before markets reopened and that satisfied the PRA. Regulators had already sounded out larger banks as potential buyers, yet none stepped forward quickly enough.
Metro’s new strategy
Since the restructuring the bank has shifted from low-margin retail banking toward higher-margin specialist lending while cutting costs aggressively. It sold £2.5 billion of prime residential mortgages and moved into corporate lending and specialised mortgages that offer higher yields.
The bank eliminated more than 1,000 roles, representing 30% of headcount. It also ended the seven-day branch opening, a break from the long hours it launched with as a challenger in 2010. It’s partnership with Infosys outsourced and modernised IT operations and support functions. Automation and AI-enabled processes under the arrangement reduced associated in-house roles. Together with supplier renegotiations these steps supported the bank’s £80 million annualised savings target.
The bank returned to profit in 2025 with £87.2 million, against a £212.1 million loss in 2024. Pre-tax profit rose 41% to £61 million in the six months to 30 June, the most profitable half-year in its history.
How can Bacal exit from Metro?
Metro’s decision to launch a formal sale process looks less like an open-ended strategic review and more like a structured attempt to let Bacal exit.
Market commentary has repeatedly flagged private equity as the most natural buyer for a clean, all-cash outcome that would allow him to crystallise the gain on the 30p shares.
Investors remain wary of underwriting the current model. The return to profit rests on cost cuts and a shift into specialist lending that has yet to be tested through a full cycle, while the 78-branch network still carries fixed costs that digital peers do not.
Digital rivals are leaner and more competitive. Starling’s retail cost-to-serve was near £46 per customer at the end of 2025. Branchless peers like Monzo and Revolut carry none of the property and staffing costs that still sit on Metro’s 78-branch network. Those fixed costs remain high even after the earlier cuts to headcount and opening hours.
The same features that made Metro a cheap entry point in 2023 may now limit what buyers are willing to pay, falling short of the multiples Bacal achieved on his previous exits.
Author: Scott Danaher
See Also:
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Revolut completes fundraising process establishing $115 billion valuation | Disruption Banking
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