Metro Bank’s shares have surged on speculation of a private‐equity takeover by Pollen Street Capital, part-owner of Shawbrook Bank. The bid, still in informal stages, peaked Metro’s stock at around 133 pence, an 18 per cent jump and the highest level since March 2023, valuing the bank at approximately £890 million.
This excitement stems from Metro’s impressive post-2023 turnaround. After nearly collapsing due to accounting failures and regulatory fines, it revamped its strategy under CEO Dan Frumkin – slashing costs, refocusing loans on small businesses, maintaining a streamlined branch network, and returning to profitability by late 2024. Key to its revival was a £925 million recapitalisation in 2023 led by Colombian billionaire Jaime Gilinski Bacal, now 53 per cent owner.
Pollen Street’s interest in Metro makes strategic sense: combining Metro’s sticky, low-cost current account funding with Shawbrook’s high-growth commercial and buy-to-let lending operations could drive synergies and strengthen both banks’ positions in the market. Analysts at KBW emphasise that such a merger would yield significant value. However, success hinges on stakeholder agreement, especially that of Gilinski, and the buoyancy of any offer price.
For employees and customers, the transition brings uncertainty. Metro has already undergone substantial restructuring, including roughly 1,000 job cuts and reduced branch hours. A takeover and possible merger could impose further changes. Yet for shareholders, particularly those who invested near the trough at 30 pence in 2023, the potential deal could offer a strong return – shares nearly quadrupled before speculation even began.
This move also reflects broader consolidation trends among UK challenger banks. As digital-focused lenders dominate, private equity is acquiring undervalued assets removed from LSE scrutiny. A Metro–Shawbrook union would follow recent mergers like Nationwide’s takeover of Virgin Money and Shawbrook’s own flirtations with Starling Bank.
