WhatsApp pours fuel on Metro Bank’s PR fire


Louise Bowman
Published on:

Metro Bank’s credibility had been in question for a long time – that is what made it acutely vulnerable to online attack.


On Thursday lunchtime I decided to take a break from my editorial deliberations and have a stroll down to St Paul’s Cathedral to clear my head. As I was waiting to cross the road at the traffic lights a group of fresh-faced and well-heeled youngsters gathered next to me. “It is so funny!” blared one to his friends over the noise of the traffic. “I know the head of liquidity at Metro Bank and the bank has just gone into liquidation! Liquidity to liquidation!”

Slightly shocked, I checked my phone to confirm this unlikely tale. Which was, of course, not true. But the same exercise has been playing out at warp speed online, after a WhatsApp message was posted online last week declaring that anyone with a Metro Bank account or safety deposit box should empty it as the bank was facing “a lot of financial difficulties".

This message prompted further false rumours that the bank would not open its doors on Monday May 13, and if customers did not retrieve items from their safety deposit boxes by the weekend, their items would be forfeit. Queues of anxious people quickly formed at some of Metro Bank’s London branches.


"We're aware there were increased queries in some stores about safe deposit boxes following false rumours about Metro Bank on social media and messaging apps,” the bank responded. “There is no truth to these rumours, and we want to reassure our customers that there is no reason to be concerned."

The episode is a handy reminder of the fuel that social media now pours onto any smouldering bank PR fire. Metro Bank has been the subject of concern for some time, as this magazine outlined last summer. The revelation at the beginning of this year that an accounting blunder had resulted in extra capital being required to hold against commercial loans secured on property and certain specialist buy-to-let loans (for which the risk weighting the bank had calculated had been too lenient), has only made the headlines worse.

It is difficult to know how banks can effectively manage social media exposure when one false WhatsApp message can wipe more than 10% off their share price in one day 

The accounting error prompted a £350 million rights issue on May 14 compared to the bank’s total market capitalization of £490 million. It could also be seen to have created a false market in the bank’s shares. The Prudential Regulation Authority and Financial Conduct Authority have launched an investigation into the origin of the miscalculation.

Metro Bank has received £120 million from Banking Competition Remedies as part of the Royal Bank of Scotland State Aid Alternative Remedies Package. That decision will likely come under harsh scrutiny now. On top of this is the much-reported £25 million that the bank has paid over the last eight years to Shirley Hill, wife of Metro Bank founder Vernon Hill, for her New Jersey-based firm InterArch’s interior design, branding and marketing services.


The WhatsApp message was so effective in spreading panic because of the existing noise around Metro Bank – the accounting error had been suspected for a long time before the bank admitted to it. First quarter pre-tax profits had also fallen to £6.9 million from £10 million in 2018.

Queues at branches are never a good look for a bank – the assumption is always that people are emptying their accounts rather than their safety deposit boxes. Metro’s share price duly slumped by 11% on Monday May 13.

It is difficult to know how banks can effectively manage social media exposure when one false WhatsApp message can wipe more than 10% off their share price in one day. It was TV and newsprint images of long queues outside Northern Rock branches that accelerated the run on that bank in 2007, the first in the UK for 150 years. Today, it takes little more than one anonymous message on social media to have the same effect. Metro Bank is not big enough for this incident to have had a widespread impact – but larger banks should most definitely take note.