Metro Bank added to FCA’s financial crime watchlist
Metro Bank has been added to the City regulator’s financial crime watchlist, the lender confirmed, posing another headache for the bank as it looks to rebuild after securing a major refinancing deal.
The troubled lender “received confirmation of its position on the FCA watchlist for financial crime compliance” back in June, it said in a statement late last week.
Metro said the Financial Conduct Authority was reviewing “the ongoing management of financial crime risk within the group’s back book as well as specific concerns over the effectiveness of financial crime controls over the group’s online account provisions”.
The regulator’s watchlist is made up of companies that “pose the greatest risk to our statutory objectives”. Groups on the watchlist are placed under “enhanced supervision” by senior watchdog officials and required to show progress and address issues that are of concern.
The admission of being added to the regulator’s watchlist, which was first reported by The Sunday Times, was included in a more than 200-page prospectus to promote a rescue deal revealed in October.
The refinancing package includes a £325m capital raise led by existing shareholder Spaldy Investments, alongside £600m of debt refinancing.
The deal would raise the stake of Colombian billionaire Jaime Gilinski from nine per cent to 52.9 per cent and goes to a vote on 27 November.
Metro warned shareholders that the Bank of England could impose alternative measures if they did not support the plan.
An unnamed source told The Sunday Times that an investigation into Metro’s financial crime systems had been long-running.
The bank added: “The group continues to engage, update and co-operate fully with the FCA on these matters and the FCA’s enquiries remain ongoing.
“The outcome and timing of these matters is inherently uncertain and, based on the facts currently known, it is not possible to predict the outcome or reliably estimate any financial impact.”
It said it has not made any financial provision to cover a potential penalty relating to the matter.
City A.M. has approached Metro Bank for comment, while the FCA declined to comment.
The FCA slapped Metro with a £10m fine last December for publishing incorrect information to investors in 2018.