Metro Bank has completed the purchase of a portfolio of UK mortgages worth £596.7 million from Cerberus, increasing its mortgage book by 15%.
The portfolio consists of approximately 92% buy-to-let mortgages, with the remainder owned by people with their own homes.
Metro Bank said that lending in the portfolio is secured on property and has a similar credit risk profile its current mortgage book.
The acquisition will increase the loan to deposit ratio to around 78%, edging closer to the 80% target it hopes to reach by 2020.
The £596.7 million paid represents the value at which the acquired mortgages will be taken on to the balance sheet and has been financed using cash from existing resources.
Craig Donaldson, CEO of Metro Bank said, 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.
“The portfolio complements our existing mortgage book and demonstrates our willingness and ability, helped by our strong deposit growth, to take advantage of opportunities as they arise.”
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