Metro Bank – continued profit growth against dynamic market backdrop, shares up 41% in last three months, with more to come!

Mark Watson-Mitchell - 01.06.2026

Last week RBC Capital Markets suggested that the shares of Metro Bank Holdings (LON:MTRO) will Outperform, while setting a 195p Target Price.

The £1.15bn-capitalised group’s shares, which have put on over 25% in value within the last month alone, now stand at 171.40p.

At the beginning of March, I featured this banking company at 122p, so the subsequent 41% price gain must be more than pleasing for its investors.

That market-beating performance could well indicate that substantial upside remains for its shares.

Tomorrow, Tuesday 2nd June, will see the group hold its AGM to approve its 2025 Report & Accounts, covering a year that saw the reshaped group report a significant swing from losses into useful profits.

The Business

Metro Bank provides corporate, commercial and SME banking and specialist mortgage lending, alongside retail and private banking services.

It offers relationship banking through a network of 78 stores in the UK, telephone banking from UK-based contact centres and digital banking via mobile app and online.

It is worth noting that Metro is an independent UK bank – it is not affiliated with any other bank or organisation.

First Quarter Update

On Thursday, 30th April, the Bank issued a First Quarter Trading Update stating that it had enjoyed a strong first quarter of 2026, with continued growth in underlying and statutory profit, reaffirming all previously issued guidance.

The bank saw a 5% increase in its target lending segments, including Corporate, Commercial, SME lending, and Specialist Mortgages, as its asset rotation strategy progresses.

Credit quality remained robust with a highly collateralised portfolio and low arrears rates, while Metro Bank maintains the lowest Cost of Deposits among UK High Street banks.

Total assets stood at £16,555m, with gross loans and advances to customers reaching £9,141m, a 6% increase year-on-year, and net loans at £8,998m.

Customer deposits were £13,280m, and the net loan to deposit ratio was 68%.

Management Comment

CEO Daniel Frumkin stated that:

“We have started the year well, building on the positive momentum that we carried into 2026 by delivering continued profit growth and increased lending in our key target areas against a dynamic market backdrop.

As we successfully rotate our lending and reshape the balance sheet, we have an established and high-quality pipeline, and the lowest cost of deposits of any UK High Street bank.

We are confident in reaffirming all guidance previously provided.

Our commitment to relationship banking, our store network and the communities we operate in are positive differentiators, enabling us to win market share and increase lending.

We look ahead with confidence and remain focused on delivering for our colleagues, customers, shareholders and supporting UK growth.”

In the latest Report & Accounts he states that:

“Outlook: clear strategy, disciplined delivery and resilient model create strong momentum.

The Bank is well-positioned to continue delivering its strategy and growth trajectory.

We have a clear plan, a strong customer proposition underpinned by deep relationships and a resilient model that supports profitable growth.

The Bank expects to deliver greater than 18% RoTE for 2028, almost trebling 2025 RoTE and in doing so, firmly positioning us as a UK market leader.”

The Equity

There are some 673m shares in issue.

Following a 2023 rescue deal, Colombian billionaire Jaime Gilinski Bacal, known for building Latin American banking empires, became the largest and controlling shareholder (52.98%) through his Spaldy Investments vehicle.

Bacal is an experienced banker, real estate developer and philanthropist and has extensive holdings primarily in the banking and real estate sectors in Latin America and the United States.

He invested heavily to become the majority owner when the bank needed capital, solidifying his role as the main backer before joining the board as a non-executive director.

Larger holders include Spruce House Investment Management (10.10%), Fidelity Management & Research (3.64%), Davis Selected Advisers (2.63%), Hargreaves Lansdown Asset Management (1.86%), Aberdeen Group (1.76%), Conifer Management (1.69%), Goldman Sachs Group (1.66%), BlackRock (1.44%), and Perea Capital (1.37%).

Broker Views

RBC Capital Markets last week predicted that the group’s shares will Outperform, while setting a 195p Target Price.

Three firms closely follow the progress of Metro Bank, the average Target Price is 157p, the Lowest at 120p, while the Highest aim is for 195p.

Analyst estimates suggest £706.8m income for this current year, with £180.3m profit, worth 19.6p of earnings per share.

For the 2027 year, £806.3m income is possible, with some £260.3m in pre-tax profits, and generating earnings of 29.0p per share.

My View

The group’s shares, now 171.40p, have performed very well to date, but will this pace continue?

It could well pay investors to ‘top-up’ holdings if there is a profit-taking run following the recent upward push.

However, an early push through the 200p price barrier can be anticipated.

(Profile 02.03.26 @ 122p set a Target Price at 140p*)