While a Colombian banker has bought 7.4 million shares in Metro Bank, the British lender’s biggest backer has cut his stake in the beleaguered bank.
James Gilinski Bacal is one of Colombia’s richest men and has bought a 4.3% share in the challenger bank, according to Bloomberg. The deal will make him Metro Bank’s third largest shareholder. The deal is worth roughly £15m.
Gilinski Bacal is no stranger to investment, having bought a 7.5% stake in Spanish bank Banco de Sabadell in 2013.
The news about Gilinski Bacal’s investment comes as Steve Cohen, the hedge fund billionaire, sold down 3.8 million Metro Bank shares, according to regulatory filings published days after the Gilinski Bacal deal went public, the Telegraph reported.
The share are estimated to be worth about £7m.
Cohen has supported Metro Bank since it was founded in 2010. He still owns a 7.65% stake in the challenger bank.
However, many shareholders are reportedly losing faith in Metro Bank after a 2019 proved to rife with setbacks for the scaleup.
In January, a £900m accounting error that miscalculated the riskiness of a string of property loans shocked investors and slashed millions off the company’s value.
Another setback occurred in May when a rumour circulated on WhatsApp, claiming customers’ money would not be safe within the bank’s accounts and safety deposit boxes.
Those rumours caused massive queues outside of Metro Bank’s branches as customers demanded to withdraw their assets.
While Metro Bank was later able to raise £375m to strengthen its balancing sheet within three hours, the troubles for the bank were not over.
In September its shares went into freefall again after a botched attempt of drumming up support for a bond sale had to be cancelled when it missed its target of injecting between £200 and £250m into the business.
Metro did later manage to raise £350m in an oversubscribed bond sale at the end of September.
Afterwards, founder and chairman Vernon Hill announced he would leave the company. Hill had earlier made public plans to step back from the chairmanship. Although, people thought he would remain on the board as a non-executive director. Hill instead announced he would leave Metro Bank on New Year’s Eve.
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