The PRA has fined Metro Bank plc a total of £5,376,000 following the Bank’s failure to act with due skill, care and diligence in relation to the regulatory reporting of its capital position, as well as for failings regarding its regulatory reporting governance, controls and investment with respect to its Common Reporting (COREP) returns.
Back in December 2019, Metro Bank announced that it was adjusting its assessment of its risk weighted assets (RWA) by approximately £900 million due to having applied the incorrect risk weighting to certain commercial loans. By applying the incorrect risk-weight, the Bank presented an inaccurate picture of its regulatory capital position to the PRA.
In addition, prior to 2019 the Bank had experienced rapid growth and expansion. But, during that time, it failed to ensure appropriate development of, and investment in, governance arrangements and systems and controls relating to COREP reporting, as required by the CRR. These failings resulted in breaches of Fundamental Rules 2 and 6 of the PRA Rulebook.
The PRA reduced the fine by 30% to take account of Metro Bank’s agreement to resolve the above matter, without which the fine would have totalled £7,680,000.