The Bank Of Toytown, But Nobody Is Playing - Metro Bank
When the US bank Metro Bank arrived in the UK in 2010 it was the first new high street bank in 100 years. It was an exciting addition to the traditional British banking sector - bright and airy branches, a “can do” attitude, longer opening hours, weekend working, coin counting machines and even dog treats.
Nine years later and it’s all beginning to look a bit, well stale. But don’t take my word for it, on Thursday their shares fell by another 8% - the bank has lost three quarters of its value since January when it revealed that it had wrongly allocated loan categories making their loan book look less risky. After that they lost £500 million of business deposits.
All of this has put Metro Bank’s governance under the microscope with the ongoing issue of blurred lines with the founder of the bank employing his wife’s interior design company to design the bank’s branches.
A couple of months ago I got talking to an ex senior employee and asked if all the headlines were true, tight lipped and professional, his silence and body language spoke volumes.
But financial performance and governance issues aside I think this bank is toast in the UK because it no longer feels relevant.
The challenged “old school” banks are now behaving like challengers - finally and a raft of new startup brands bring energy and digital relevancy to the sector. They don’t need differentiated branches because they don’t need branches full stop. And they feel cool to be a part of.
That leaves Metro Bank looking like a tired and dogeared big box electronic goods store on the high street.
It faces shareholders at its AGM in a couple of weeks but short of radical management changes and a top to bottom rebrand I think the decline will accelerate.
Not so much a run on the bank more a bank running out of runway.
About the Author
The author is a brand consultant and founder of Mission Critical, a highly focused and curated weekly briefing for time poor and information hungry decision makers
