Struggling Metro Bank is set to axe 800 jobs and reduce its business hours in an effort to combat a severe financial crisis. With approximately 2.7 million customers and 75 branches in the UK, the bank plans to cut 20% of its workforce of 4,000 employees. Additionally, Metro Bank intends to discontinue its seven-day branch opening schedule as part of its cost-cutting strategy.
Financial Troubles and Recovery Plan
Last month, Metro Bank announced a £30 million cost-cutting plan, and now, it is taking further measures to stabilize its operations. After experiencing a collapse in its share price, the bank received a £925 million injection from a Colombian billionaire. The new refinancing and recapitalization plan will involve cost reduction actions in early 2024, with the goal of saving £50 million annually to strengthen its balance sheet.
Background and Misclassification Controversy
Metro Bank was established in 2010 to address public frustration over the closure of high street banks following the financial crisis. The bank aimed to focus on branch services by operating seven days a week. However, it faced criticism in 2019 when £900 million in loans were misclassified. Despite these challenges, CEO Daniel Frumkin emphasized the bank's commitment to stores and the high street, while transitioning to a more cost-efficient business model that prioritizes customer service.
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