SHARES in Metro Bank tanked after the lender revealed the impact of a major accounting error and subsequent investor cash call in what it described as a "challenging" first quarter.

The high-street lender's shares plunged over 15 per cent in morning trade after it unveiled a dismal set of first quarter figures late on Wednesday, before recovering to 11% lower at 688p.

In January, Metro flagged that it had miscalculated the risk weighting of commercial loans secured on property and certain specialist buy-to-let loans.

It later unveiled a £350 million cash call to make up for the shortfall on its balance sheet.

The share price collapse comes off the back of fresh figures showing quarter-on-quarter deposit growth was affected by some major customers withdrawing during the fallout from the debacle, resulting in a 3.6% reduction.

Total deposits stabilised in March and returned to growth in April.

Compared to the same time last year, deposits were up 19% to £15.1 billion.

Underlying profit before tax sank to £6.9 million, compared to £10 million in the same period last year. On a statutory basis, pre-tax profits fell from £8.6 million to £4.3 million.

Customer numbers grew faster than the equivalent period last year, as 97,000 new accounts took the total to 1.7 million.

Michael Hewson, analyst at CMC Markets, said: "If management were hoping to avoid greater scrutiny by giving analysts limited time to peruse the numbers then this morning's share price action suggests that while they may have avoided some difficult questions, the numbers more or less speak for themselves.

"They also raise important questions over not only the quality of management's oversight policies but also the auditors themselves."

To compound matters, shareholders have been urged to vote against the re-election of founder and chairman Vernon Hill amid the fallout from the accounting blunder.

Investor advisory firm Glass Lewis has recommended that shareholders reject Mr Hill's reappointment at the lender's annual meeting this month, citing millions in payments made by Metro to his wife's architecture firm InterArch.