Metro Bank CEO says £12m takeover of RateSetter was completed without any face-to-face meeting

Metro Bank’s acquisition of RateSetter was announced in August this year, as country came out of lockdown.

The CEO of Metro Bank said he’s not yet had a face-to-face meeting the CEO of the alternative lender the bank shelled out up to £12m to acquire during Covid-19.

In a wide-ranging interview at yesterday's AltFi’s Festival of Finance, Daniel Frumkin, CEO of Metro Bank, also said that Metro Bank would likely open fewer branches in the next few years, but the bank was committed to physical branches.

Frumkin said the deal to acquire alternative lender RateSetter came together “very quickly” and the deal was agreed inside of six or seven weeks.

“I still haven’t broken bread with Rhydian [Lewis, RateSetter CEO]. We have not even met face-to-face,” Frumkin said.

The deal was announced to the market in August this year during Covid-19, as many bosses worked from home and conducted business via video calls.

On the future of Metro Bank branches post Covid-19, Frumkin said: “We have 77 stores and they have almost all been chosen in the last six or seven years.”

“They are in locations we want to be in. We think they are locations over the medium term that will be really strong. We are completely committed to the store estate.”

“We will probably open a bit fewer stores over the next couple of years while we figure out you know what the high-street is and whether out of town locations are better with drive-thrus. But we’re completely committed to stores.”

Frumkin also said that RateSetter will act as a white label for Metro Bank to do unsecured personal loans through its stores and online.

On RateSetter’s lending operation, which also includes property and vehicle lending, Frumkin said propety and vehicle lending were “under review”.

On vehicle lending, he said “we have just got to decide if it’s a business we want to be in. If it is a business we want to be in, we are going to want to make it much bigger because it’s too small to make a difference to Metro.”