Metro Bank is redirecting its focus towards commercial, corporate, and SME lending. Credit: Ceri Breeze/Shutterstock.

Metro Bank in the UK is in the early stages of talks regarding the potential sale of its profitable consumer loan portfolio, as it redirects its focus towards more lucrative commercial, corporate, and SME lending.

Confirming the move, the bank said that a potential sale is likely to boost its CET1 and MREL ratios.

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It did not reveal who it was in discussions with, while stressing that the possibility of a deal materialising is uncertain.

“There is no certainty that a transaction will be agreed or the terms of any such transaction,” it said.

The lender said that it continues to look out for opportunities to optimise its balance sheet, amid the “strong growth” recorded in new Commercial and Corporate lending.

Metro Bank, founded in 2010 to compete with the dominance of Britain’s major banks, has been restructuring its business and selling off certain assets to strengthen its finances following a rescue agreement in October 2023.

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In November last year, the Financial Conduct Authority (FCA) penalised Metro Bank for deficiencies in its anti-money laundering systems.

The regulator claimed that these shortcomings impacted over 60 million transactions, totalling more than £51bn ($65.2bn).

Meanwhile, last September, Metro Bank reached a long-term partnership with Infosys to improve its IT and support functions.

The partnership aids the bank’s continued efforts to improve efficiency and reduce costs. By working with Infosys, Metro Bank aims to enhance its digital capabilities, boost automation, optimise data, and integrate additional AI features.