Look, here I squashed the word 'Normandy' and pulled it up:
And even more:
In Metrics Inspector (the litle ruler icon) uncheck 'Constrain Proportions' box and you can now reduce the width of the text with the images remaining inside creating a more upward surging, 'gothic cathedral' feel or, the other way round, increase the width and reduce the height of the image to give it a squat, 'romanesque' view.
This simple trick can be used not only when you want to put images inside letters. It is also of great help for cards, posters or book covers when the main goal is to make the key word of phrase stand out and grab the viewers attention.
Read the full how-to here