Beleaguered Metro Bank calls in consultants to help find a buyer

Metro Bank has called in consulting giant Ernst & Young as it scrambles to find a buyer.

The adviser has been in talks with lenders over the weekend, hoping to secure a deal before markets open today, according to reports from Bloomberg.

Banking heavyweights JP Morgan Chase and HSBC both considered a bid for the challenger bank before deciding against it because of concerns about the extra capital any new buyer would have to put in. 

Santander UK is also being advised by George Osborne’s firm, Robey Warshaw, about mounting a takeover, according to reports by Sky News. 

Metro – which was set up in 2010 – is reportedly looking for a lifeline of up to £600m. 

Its shares crashed last week after the bank confirmed that it was seeking to bolster its capital position.

It recently rejected a takeover approach by Shawbrook, a so-called challenger bank.

Metro, which has 2.8m customers and 76 branches, needs cash to refinance a £350m debt within a year. 

It has been suggested that the Bank of England’s Prudential Regulation Authority (PRA), which supervises banks, has also been in conversations with several British lenders to rally interest in Metro.

Danni Hewson, an analyst at AJ Bell, said: ‘The clock is ticking for Metro Bank. Every minute of doubt is costly – depositors lose confidence, investors become nervous and the cost of securing the bank’s future goes up.’