Metro Bank’s early Old Bailey office exit costs £40m
Metro Bank’s decision to vacate its offices at 20 Old Bailey, EC4, has cost the bank around £40.6m this year.
The bank’s statutory pretax losses totalled £311.4m this year, deepening on an equivalent loss of £130.8m in 2019, which was partly down to its “accelerated” exit from the location.
Its underlying loss before tax stood at £271.8m, compared with a £11.7m loss in 2019. The bank estimated a £124m impact from the Covid-19 crisis.
Metro Bank’s decision to vacate its offices at 20 Old Bailey, EC4, has cost the bank around £40.6m this year.
The bank’s statutory pretax losses totalled £311.4m this year, deepening on an equivalent loss of £130.8m in 2019, which was partly down to its “accelerated” exit from the location.
Its underlying loss before tax stood at £271.8m, compared with a £11.7m loss in 2019. The bank estimated a £124m impact from the Covid-19 crisis.
Metro Bank took the decision to ditch its Old Bailey office last year as part of a “more proactive management approach” to its property estate, as it shifts to more remote working.
It stated: “The success of our working from home arrangements as well as feedback from colleagues is leading us to explore other opportunities for office space rationalisation, including better utilising excess space in our store network rather than occupying standalone office space.”
As an example, the bank highlighted that it has set up a new operations centre at its previously over-spaced Bristol store.
However, the bank has also identified opportunities to take advantage of declining retail real estate prices. It has bought the freeholds for three of its stores, at “attractive” yields.
“The stores purchased were on 25-year leases with no break clauses and were bought at amounts close, or equal to, their right of use asset – meaning only a marginal upfront capital impact in exchange for longer-term savings and flexibility,” the bank said.
Freeholds now make up 30% of its store estate.
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