Metro Bank PLC (LSE:MTRO) shares rose after it reported its second consecutive quarter of profitability on a statutory basis, with a strong period for current account openings.
Total deposits of £15.6bn at the end of March were down 5% on a year ago and 3% since the last year-end, which the challenger bank said reflected seasonal factors such as tax payments in January, partially offset by net inflows in March.
The lender re-entered the fixed-term deposit market during the quarter, with its core base of customer deposits predominantly households and small businesses with low average balances.
Loans were up 5% year on year to £12.9bn, down 1% since the year-end, with the bank saying it continues to strategically manage its allocation of risk-weighted assets "to optimise risk-adjusted return on regulatory capital to improve margins and profitability".
Retail mortgage lending increased marginally, offset by the managed reductions in both consumer lending and commercial lending.
Chief executive Daniel Frumkin said: “Metro Bank has delivered a second consecutive quarter of underlying profitability and March has been our strongest month of performance since the turnaround commenced."
The turnaround was put in place by Frumkin and the board in early 2020, to develop a digital and community bank model.
The shares rose 3% to 100.42p, up 10% over the past year.