Metro Bank shareholders back $1.15 billion capital injection plan

FILE PHOTO: People walk past a Metro Bank in London, Britain, May 22, 2019. REUTERS/Hannah McKay/File Photo

(Reuters) – Metro Bank shareholders on Monday backed the lender’s proposed 325 million pound ($404.98 million) capital raise and 600 million pound debt refinancing, clearing the final hurdle in a rescue plan that won bondholder approval in October.

After urgent talks to bolster Metro’s balance sheet, 92.73% of the total votes cast at the challenger bank’s general meeting were in favour of the plan.

The deal hands majority shareholder control to its biggest investor, Colombian billionaire Jaime Gilinski. It would entail a hit for bondholders, who would then switch into higher interest-paying bonds.

Metro was launched in 2010 to challenge the dominance of Britain’s big banks, but hit a string of setbacks in recent years, such as accounting errors, leadership departures and delayed regulatory approval for key capital relief plans.

Shares in the company were up 6.4% at 41.5 pence by 1345 GMT.

($1 = 0.8025 pounds)

(Reporting by Eva Mathews in Bengaluru; Editing by Devika Syamnath)