Co-Op Loses Control of Bank

Co-Op Loses Control of Bank.

News across the internet and other media today has claimed that as deal was agreed over the weekend between Co-Op Group, its bank and then bank’s creditors, the major parties being a group of Hedge Fund investors.

The speculated deal, expected to be confirmed today, is that 70% of the shares in Co-Op Bank will now be owned externally with the Co-Op Group retaining 30% of its shares.

Co-Op Bank has allegedly already invested in a series of media advertisements confirming that is its business as usual and reaffirms its ethical approach to banking.

Comment

We are delighted that a deal has been done.  This will settle many nerves of people that have their cash invested in Co-Op Bank.

We have always suggested that investors money was safe given that the Government has already committed to not let any UK bank fail and given the size of the RBS bailout, following the biggest collapse in UK corporate history, the Co-Op Bank deal at c£1.5bn seems mere ‘pin money’.

No doubt redundancies and branches will be closed as the Co-Op Bank refocuses on profitable areas.  We also suggest that the ethical approach, whilst maintained, will have a more cutting edge as Hedge Funds owners are less likely to be tolerant of poorly run or unprofitable bank segments.