Metro Bank snaps up buy-to-let mortgages from Cerberus

Metro Bank has completed the purchase of a portfolio of UK mortgages from Cerberus for £596.7m

The consideration of £596.7m represents the value at which the acquired mortgages will be taken on to the bank’s balance sheet and is being financed using cash from existing resources. The portfolio is being acquired at a discount to par.

The portfolio consists of about 92% buy to let mortgages, with the remainder being owner occupied. It has a weighted average seasoning of around 10 years and the weighted average loan to value is around 70%, with a current expected pay rate of 1.6% principally linked to the Bank of England base rate.

Metro chief executive Craig Donaldson said: “Our lending and deposit growth has gone from strength to strength and the acquisition of this high-quality loan portfolio supports our high-growth, organic business model as we track ever closer to our 2020 guidance. In particular the acquisition increases the Loan to Deposit ratio to c.78% (2020 guidance c.80%).”

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