Could Metro Bank be the future of everyday, Western banking?
As a sixth form student looking to be an investment banker post-education, I am on the look-out for companies and industries that show signs of expansion. One in particular has caught my eye this year and so far my prediction that it would grow has been correct. I anticipate this trend to continue over the next 2 years.
Metro Bank was founded in March 2010. It was the first UK high-street branch in over 150 years to be granted a licence by the FSA, and has set an ambitious goal of opening 250 stores in London by 2020.
What makes Metro Bank so unique is its customer-centric approach. Monday to Friday it is open 8 am to 8pm; 8 am to 6 pm on Saturdays; and 11 am to 4 pm on Sundays. Closing only 4 days a year, this rapidly-developing firm certainly shows signs that it could increase its market share in the near future. The bank also provides free dog biscuits for pets and lollipops for children.
Customers are looking for a new, convenient way of banking with easy-to-understand products. People's lives have changed. Great retailers have moved with them and so has Metro Bank.
Still not convinced? The first quarter of 2016 saw a record growth of deposits of +£790m. This included a completion of a £400m capital rise and an increase in the amount of customer accounts from 655,000 on 31st December 2015 to 717,000 on 31st March 2016; a quarterly net increase of 62,000 accounts. That is an increase of 45% year-on-year and a 9% increase within the quarter.
To summarise then, I see huge upside potential and very little downside to the new, underdog of the banking community. I expect very soon the market share to rocket into and maybe above the likes of Lloyds and HSBC. Just a little something to think about when looking for something to invest in.