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British challenger bank Metro admitted it will not receive capital relief from the Bank of England until at least 2024, the latest in a series of blows to its efforts to adopt an in-house model used by larger banks to cut capital charges.
“The (Prudential Regulation Authority) has indicated that at this stage the company needs to do more work, which means approval will not be granted in 2023,” the bank said on Tuesday. “While Metro Bank continues to engage with the PRA regarding its application, it is not Determine if it will be approved.”
Metro has spent five years pursuing the use of an in-house model that would allow banks to use their own history to calculate the riskiness of loans, rather than relying on more punitive standardized methods.
Other challenger banks, such as Close Brothers and Paragon, have also faced years of delays in approvals that could have saved them hundreds of millions of pounds.
The PRA did not immediately respond to a request for comment.
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