Modern Banking: Overview, Analysis, and Performance

Modern Banking

Contents
INTRODUCTION...........................................................................................................................3
TASK...............................................................................................................................................3
1. General overview of bank..................................................................................................3
2. Critically analyse of bank with BS and IS..........................................................................3
3. Critically analyse of bank’s performance with different ratios..........................................6
4. Evaluation of changes in banking sectors........................................................................10
5. Expected future performance...........................................................................................12
CONCLUSION..............................................................................................................................12
REEFRENCES..............................................................................................................................13
APPENDIX....................................................................................................................................14

INTRODUCTION
In the present world, each and every concept of business is chaining as well as different
advance techniques and technologies have been adapted by businesses in order to increase
profitability (Peters and Panayi, 2016). The modern banking is concepts related with introduction
of e banking with use of advance technology that makes easier banking services for customer. E
banking mainly includes Internet banking and banking through other electronic modes such as
ATM, M-banking etc. which save cost and time for both parties (customer as well as bank
members). In order to better understand the concept of modern banking Metro Bank PLC
MBNKF is selected.
In this report, analysis of bank on the basis of BS, IS and different ratios are discussed.
Impact of changes in banking industry which influence on bank performance is shown and
expected future performance in upcoming years are defined.
TASK
1. General overview of bank
Metro Bank plc is a UK-based commercial and investment bank, established by Vernon
Hill and Anthony Thomson in 2010. It became the first major high street financial institution to
be introduced in the UK in over 150 years which is mentioned on the LSX. Metro Bank offers
financial facilities to accounts holder to both individuals and companies. It is approved by the
Prudential Regulation Agency and governed from both the Authority for financial behaviour as
well as the Law for Prudential Compliance. During the first quarter of 2013, Metro Bank raised
its bank customers by 50 per cent for a sum of 200,000 deposit accounts, such as 15,000
company accounts. This planned to establish 200 UK outlets by 2020. In August 2013, Metro
Bank purchased SME Financial services and in May 2014 rebranded the company to Metro Bank
SME Fund (About Metro bank plc, 2020).
2. Critically analyse of bank with BS and IS
The balance sheet is often called the financial condition document that reflects the
financial circumstances of a business in the end of a defined accounting period. In general term it
is define as a "snapshot" of the financial condition of the company which can be used to
determine the total assets, liabilities and debts and equity hold for a year. In the context of Metro

bank the respective discussion of balance sheet of few years (from 2015 to 2018) are discussed
underneath:
The total cash & dues from the bank have been continuously increasing from 2015 to 2018 as
(227 to 2300 GBP Millions respectively). There have been massive investment growth of bank
from 2015 to 2016 which is 61.35% and further the growth was positive but at slow rate which
shows good sign for development of bank. It is also noticed that assets in 2015 was 6153 GBP
Millions which increase in 2016 to 10,057 GBP Millions which is approx rise of 63.46%.
Moreover, the value of assets in 2017 was 16,371 GBP Millions that further increases to 21,647
in 2018 that clearly states that bank in continuously growing and there are enough resources to
write off any future current or long term liabilities.
1 2 3 4
0
5,000
10,000
15,000
20,000
25,000
21,647
16,371
10,057
6,153
Total Assets
Total Assets
At the other side of balance sheet, it has been observed that deposit growth of Metro
Bank plc have been reducing due to decrease in the demand deposits, saving or time deposits in
respective years. The growth rate reduces form 55.66% to 46.77% from year 2016 to 2017 and in
year 2018 it was 34.21%. Total debt increase from 2015 to 2018 like 562 (2015), 1196 (2016),
3442 (2017), 4394 (2018) all figures are in GBP Millions. This states that to meet the business
operation and make update in the services bank is continuously using external sources to raise
capital. In the context of Long Term Debt Growth there was a huge increase like in 2016 the
amount was 543 GBP Millions that increase to 3321 GBP Millions that is approx. 511.58%. The
amount of deferred tax liabilities and retained earnings are shows negative balance as company