Metro Bank's shares lost up to a third of their value after recent reports showed it is seeking to raise £600 million to bolster its finances.

While Metro Bank did not comment on the figure, it sought to reassure its investors about its financial position on Thursday (15 Oct), saying it "continues to consider how best to enhance its capital resources".

The financial services regulator, the Prudential Regulation Authority, are monitoring Metro Bank's situation and are reportedly in talks with Treasury officials.

Metro Bank insiders described the earlier discussions with the regulator as "routine".

Despite this concern, the bank, which has around 2.7 million customers, maintains it is meeting all regulatory requirements and its finances "remain strong".

There is no indication that customer deposits are at risk. In the event that a bank runs into trouble, however, depositors will get their money back up to a value of £85,000 under the Financial Services Compensation Scheme.

Due to Metro Bank's high debt costs, analysts at investment bank KBW believe the company will be unable to issue fresh debt on the open market.

"We suspect that some form of ‘friends and family' transaction targeted at existing equity/debt investors would be the most likely prospect."

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