NatWest to acquire £2.5bn in prime UK residential mortgages from Metro Bank
British bank NatWest has entered into an agreement to acquire a portfolio of prime UK residential mortgages worth £2.5 billion from high-street lender Metro Bank.
NatWest to acquire UK mortgages from Metro Bank
The transaction is expected to close in H2 2024, subject to the approval of the Competition and Markets Authority (CMA).
Once completed, the deal will see NatWest welcome 10,000 new customer accounts, which Metro Bank will continue to service, with an average loan-to-value (LTV) ratio of 62%.
Paul Thwaite, CEO of NatWest Group, describes the transaction as “a further opportunity to accelerate the growth of our retail mortgage book within our existing risk appetite”, and expects the deal to deliver “attractive returns”.
The move comes just a month after NatWest announced a deal to purchase the core banking business of British supermarket group Sainsbury’s – a deal expected to close in H1 2025.
The Sainsbury’s deal will see £2.5 billion of gross customer assets absorbed by NatWest, including £1.4 billion in unsecured personal loans and £1.1 billion in credit card balances, alongside around £2.6 billion in customer deposits.
For Metro Bank, the sale of the mortgage portfolio follows the approval of a £925 million refinancing plan compiled by Morgan Stanley and Moelis last November.
Separately, the bank has also announced that it is axing credit cards from its product range.
The company says in a post on its website that it is no longer accepting new customers for its Personal Credit Card product, adding that existing customers will no longer be able to make purchases or withdraw cash through their Metro Bank credit cards from 10 September 2024.
