Metro Bank Shares Soar as Private Equity Giant Signals Takeover Interest

Shares in troubled high street lender Metro Bank rocketed more than 18% today following reports of a potential takeover approach from private equity firm Pollen Street Capital. The stock surged to 132¾p, reaching levels not witnessed since March 2023, as investors responded enthusiastically to the prospect of a buyout.

The possible acquisition by Pollen Street Capital, which currently holds a stake in Shawbrook Bank, represents a significant turning point for Metro Bank. Since its groundbreaking launch as Britain’s first new high street bank in over a century, Metro has weathered considerable turbulence, including an accounting scandal in 2019 that severely damaged its reputation and capital position.

Chief Executive Dan Frumkin’s turnaround strategy faced a critical test in September 2023 when fresh concerns about the bank’s financial stability emerged. The institution narrowly avoided insolvency through a £925 million rescue package, which resulted in Colombian billionaire Jaime Gilinski’s Spaldy Investments securing a controlling 53% stake.

Market analysts at Keefe, Bruyette & Woods note the potential “commercial logic” in combining Metro with Shawbrook. The merger could leverage Metro’s low-cost current account funding while capitalising on Shawbrook’s robust commercial loan growth. The Gilinski family stands to realise substantial gains from any takeover, having acquired their holding at just 30p per share.

Metro Bank’s journey from industry disruptor to takeover target illustrates the challenges faced by challenger banks in the UK’s competitive banking sector. Despite recent profitability in the first quarter of 2025, the bank reported a £212.2 million statutory pre-tax loss in 2024, highlighting the ongoing challenges in its business model.

The potential acquisition signals a new chapter for Metro Bank, whose current market capitalisation of £873 million remains significantly below its 2016 IPO valuation of £1.6 billion. Both Metro Bank and Pollen Street Capital have declined to comment on the speculation, and no formal announcement has been made to the stock exchange.