StockMarketWire.com - Challenger lender Metro Bank posted a deeper annual loss after it racked up more credit impairments due to the pandemic.

Pre-tax losses for the year through December amounted to £311.4 million, compared to year-on-year losses of £130.8 million.

Metro Bank said the loss also reflected a number of one-off items including the exit from a central London office and remediation costs.

Underlying pre-tax losses were £271.8 million, compared to an underlying loss of £11.7 million year-on-year.

The company estimated that it took a £124 million hit from Covid-19, comprising about £100million of expected credit losses and lower transaction fee income.

Underlying losses had halved in the second half, owing partly to an improved net interest margin and fee income.

For the full year, Metro Bank's net interest margin contracted by 29 basis points to 1.22%.

'It has been a truly unprecedented year for our business, colleagues and customers,' chief executive Daniel Frumkin said.

'The pandemic has clearly impacted performance, leading to significant expected credit losses.

'But our transformation strategy is firmly on track and we have accelerated initiatives to shift our asset mix, bringing higher yield and improving net interest margin, as evidenced in the second half.'

'2020 marked Metro Bank's 10th anniversary and whilst challenging, the strategic actions we have taken, supported by our incredible team of dedicated colleagues, means we remain on track to achieve our transformation plan as the UK's best community bank.' Story provided by StockMarketWire.com