Metro Bank shares crash after loans blunder revealed. Hundreds of millions wiped off value of company after bank says loans were wrongly classified. Metro Bank (MTRO) has revealed a major blunder in how it classifies its loan book, sending its share price crashing by 30% and wiping £600m off the value of the company. The bank, which has been opening new branches as established rivals cut back, revealed that hundreds of millions of pounds worth of commercial property loans and loans to commercial buy-to-let operators had been wrongly classified in risk terms, and should have been among its “risk weighted assets”. After the blunder emerged, Metro’s shares plummeted from £22 to about £15 as analysts feared the bank may have to raise fresh capital, just six months after tapping shareholders for £300m to finance its rapid expansion plans. When a bank has higher risk weighted assets (RWAs) regulators require higher amounts of capital to be set aside.
Trial of four former Barclays (BARC) executives begins. Fraud charges relate to multibillion-pound rescue of bank by Qatar in 2008. Four former Barclays executives have appeared in court charged with fraud in relation to the multibillion-pound rescue of the bank by Qatar during the 2008 financial crisis. John Varley, the former chief executive of Barclays, is the first bank boss in the world to face a jury trial over alleged crimes during the global financial crisis a decade ago. Ed Brown QC, prosecuting on behalf of the Serious Fraud Office, said the case would examine “how those at the very top of the bank responded to the pressure that it created”. Brown alleged that Varley, and the other former Barclays bosses, were “very anxious” to avoid a government bailout and they took the extreme measure of “disguising and hiding” almost a third of a billion pounds in fees paid to Qatari investors in return for them pumping billions into the British bank.
Former Tesco (TSCO) executive Carl Rogberg cleared of fraud. Two other directors were found not guilty in December after judge threw out the case. The last of the three Tesco executives accused of masterminding a fraud that triggered a financial crisis at the supermarket giant has been acquitted, leaving the Serious Fraud Office without a single conviction for the accounting scandal that wiped £1.5bn off the value of Tesco shares in one day. Carl Rogberg, 52, the former finance boss of the UK chain, was cleared in Southwark crown court on Wednesday morning. Two other directors, Chris Bush and John Scouler, were acquitted in December after the judge Sir John Royce threw out the case. Royce said the prosecution case was “so weak” it should not be before a jury.
