Home news Co-operative Bank no longer up for sale

Co-operative Bank no longer up for sale


The Co-operative Bank says it is no longer up for sale, pending an announcement on fund-raising proposals aimed at safeguarding its future.Co-op Bank was forced to put itself on the market in February after it was unable to reach a strong enough footing to satisfy Bank of England regulations.But in June, it said it was in “advanced discussions” with a group of existing investors on recapitalisation.Now the bank says the plan has been “substantially agreed”.The Co-op Bank, in which the Co-operative Group still has a 20% stake, was rescued from the brink of collapse by a group of hedge funds in 2013.In a statement, the bank also said talks were continuing over the separation of its pension fund from the Co-operative Group’s scheme.Under the current arrangement, the bank must carry a share of the Co-op Group’s £8bn pension liabilities, something which is proving unattractive to potential investors.Earlier this year, it reported its fifth annual loss in a row, although the £477m deficit for 2016 was an improvement on the £610m loss recorded in 2015.When it offered itself for sale, the Co-op Bank blamed low interest rates and the higher-than-expected cost of its turnaround plan for its failure to meet the Bank’s Prudential Regulation Authority rules.The Co-op Bank has four million customers and is well known for its ethical standpoint, which its board had said made it “a strong franchise with significant potential” to prospective buyers.
Source: BBC