Co-op Bank losses improve to £264m

Customer exodus hinders growth as bank strives to recover position
Customer exodus hinders growth as bank strives to recover position

The Co-operative Bank narrowed its losses last year as it battled to recover from the crisis which nearly sank it in 2013 - but it warned there remained “much to do” to turn around its fortunes.

An exodus of customers in the wake of the lender’s troubles saw the number of current accounts fall by four per cent and it admitted it faced “considerable work” to recover its market share in a “very competitive” field.

Pre-tax losses fell to £264.2 million from £632.8m the year before, as impairment charges on bad loans fell.

Chief executive Niall Booker admitted that the bank, which failed a Bank of England stress test in December, still failed to meet “regulatory requirements and expectations” in some areas.

However, he said its revised plan, accepted by the regulators, would address those issues.

The bank has had to accelerate the reduction of its loan book, which must be cut by £5.5 billion by 2018, following the test.

Mr Booker said: “Over the course of 2014 the management team has continued to take significant steps to implement the strategy and to turn the bank around.

“The Co-operative Bank is stronger than a year ago and we end the year with a strengthened capital position.

“However, we are in the early stages of the turnaround and there is still much to do to transform the organisation into a sustainable business.

“We have always been clear that the journey to reshape the business would take time but I am confident that our approach to banking is as relevant in today’s world as it ever was, and that we remain the bank of choice for anyone who shares the values and ethics which lie at the heart of our business.”

The bank also announced that it had agreed a new contract to retain Mr Booker as chief executive until the end of December 2016.