Metro Bank, which launched in 2010 as Britain's first new high street lender for more than a century, said on Sunday that it had raised 387.5 million pounds ($636 million) to fund its expansion plans by selling stock to institutional and private investors.

Hill said on Monday that the number of customer accounts rose to 275,000 in 2013, from 136,000 the previous year.

"We've had an unbelievably strong year of growth all across the board, amazing growth in the commercial and the consumer side," Hill said, adding that businesses now account for about half of deposits at the bank.

Britain's biggest banks have been criticised for reining in lending to small businesses as part of their efforts to build up capital and meet tougher regulatory demands.

"There's tremendous unfulfilled demand for borrowing in the commercial banking sector in Britain," he said.

Hill said the bank would not seek a stock market listing until it needs to raise more capital, likely to be in 2016.

Metro Bank made a 2012 net loss of 34.6 million pounds, which it said reflected significant investment in building stores, infrastructure and systems. That loss will be shown to have narrowed in 2012 when the bank publishes its full-year results this week, Hill said.

The chairman criticised plans by Britain's opposition Labour party to force the country's biggest banks to sell off branches to make room for new competitors if it wins the next election, creating two new challengers.

"If you're going to re-arrange the deck chairs what are you going to get?," he said. "I'm a free-market guy; I would rather the market solved this problem, and over time the market will solve the problem."

New British bank Aldermore, which specialises in lending to small businesses and does not have a branch network, said on Monday that it had raised 40 million pounds of new capital from UK hedge funds Toscafund and Lansdowne Partners. ($1 = 0.6090 British pounds)

(Editing by Steve Slater and David Goodman)

By Matt Scuffham