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Metro Bank To Cut 1,000 Jobs In Cost Cutting Effort

By Nithya Bose in Business News, posted March 13, 2024

Metro Bank has announced 1,000 job cuts and stopped its signature seven-day branch operating model.

This decision is part of an effort to nearly triple its cost-reduction target following a rescue agreement last autumn.

In October, Metro Bank confirmed a cost-saving initiative to reduce expenses by £30 million.

However, this plan has been expanded to £50 million, with the recent cuts exceeding the initially expected 200 jobs.

The bank also plans to further reduce costs by £30 million by year-end, aiming for a total of £80 million in savings.

Metro Bank CEO Daniel Frumkin said that would mean additional job losses and adjustments to its branch operation hours starting in April.

All branches will close on Sundays

Changes include closing all branches on Sundays, shortening operating hours at some locations, and transitioning some branches to a five-day operational week.

Mr Frumkin said: “Based off of the modelling we’ve done, we’ll still be open more hours than any of our competitors on the high street. And we’ve aligned it with actual customer activity.”

These changes are part of Metro Bank's broader strategy to navigate financial challenges.

The bank secured a £925 million lifeline in October through a rescue deal, prominently backed by Colombian billionaire Jaime Gilinski Bacal, who acquired a 53 percent ownership stake.

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This deal prevented the bank's potential dissolution or sale, which had faced regulatory challenges and a capital shortfall, sparking market concerns.

The restructuring and cost-cutting efforts appear to be yielding financial improvements.

Metro Bank reported a pre-tax profit of £30.5 million for 2023, a significant turnaround from a £70.7 million loss the previous year, marking its first statutory pre-tax profit since 2018.

Following the announcement, Metro Bank's shares saw a modest increase of 0.6 percent on Wednesday morning.

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