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The Co-operative Bank's timeline of troubles The Co-operative Bank’s timeline of troubles
(about 4 hours later)
August 2009 After almost a year of talks, the Co-operative bank and the building society Britannia agree a merger. The former Britannia boss Neville Richardson takes over as the chief executive of Co-operative Financial Services (CFS) and says the deal marks the “next step in the renaissance of the co-operative and mutual sector”.August 2009 After almost a year of talks, the Co-operative bank and the building society Britannia agree a merger. The former Britannia boss Neville Richardson takes over as the chief executive of Co-operative Financial Services (CFS) and says the deal marks the “next step in the renaissance of the co-operative and mutual sector”.
July 2011 Richardson quits following a restructuring that leads to the loss of 670 financial adviser jobs. He takes away a package worth £4.6m. The bank’s finance director, Barry Tootell, takes the reins. July 2011 Richardson quits after a restructuring that leads to the loss of 670 financial adviser jobs. He takes away a package worth £4.6m. The bank’s finance director, Barry Tootell, takes the reins.
August 2011 The Co-operative Group announces it is bidding for 632 Lloyds branches.August 2011 The Co-operative Group announces it is bidding for 632 Lloyds branches.
December 2011 The Lloyds board approves the Co-op bid. It is warned by the regulator that the Co-op lacks the necessary reserves to underwrite the deal.December 2011 The Lloyds board approves the Co-op bid. It is warned by the regulator that the Co-op lacks the necessary reserves to underwrite the deal.
Related: Co-operative Bank could face fines from regulatorsRelated: Co-operative Bank could face fines from regulators
July 2012 The deal to purchase the branches wins “heads of terms” agreement after a warning four months earlier that it might not get done. George Osborne praises the deal, saying it creates “a new challenger bank”.July 2012 The deal to purchase the branches wins “heads of terms” agreement after a warning four months earlier that it might not get done. George Osborne praises the deal, saying it creates “a new challenger bank”.
March 2013 The Co-op Group is dragged to a £600m loss by its banking arm, which is hit by compensation for PPI mis-selling, bad loan losses and a write-down of its IT system. Britannia is blamed for the bank’s £257m loss in 2012. These are the last results for the group’s chief executive, Peter Marks, who retires in May. The life insurance, asset management and general insurance businesses are lined up for sale. March 2013 The Co-op Group is dragged to a £600m loss by its banking arm, which is hit by compensation for PPI mis-selling, bad loan losses and a writedown of its IT system. Britannia is blamed for the bank’s £257m loss in 2012. These are the last results for the group’s chief executive, Peter Marks, who retires in May. The life insurance, asset management and general insurance businesses are lined up for sale.
April 2013 The Co-op withdraws its offer for the Lloyds branches, citing a “worsened outlook” in the economy and “increasing regulatory requirements”.April 2013 The Co-op withdraws its offer for the Lloyds branches, citing a “worsened outlook” in the economy and “increasing regulatory requirements”.
May 2013 Moody’s downgrades the bank’s credit rating and Tootell resigns. The former HSBC executive Niall Booker is named as his replacement. Euan Sutherland becomes the chief executive of the wider Co-op Group.May 2013 Moody’s downgrades the bank’s credit rating and Tootell resigns. The former HSBC executive Niall Booker is named as his replacement. Euan Sutherland becomes the chief executive of the wider Co-op Group.
June 2013 The bank announces a £1.5bn shortfall in reserves following talks with the new regulator, the Prudential Regulatory Authority. It says it will offer up to 49% of shares in the bank to bondholders in exchange for a £500m debt write-off. The Co-op Bank chairman, Paul Flowers, is replaced by the former Alliance & Leicester boss Richard Pym. June 2013 The bank announces a £1.5bn shortfall in reserves after talks with the new regulator, the Prudential Regulatory Authority. It says it will offer up to 49% of shares in the bank to bondholders in exchange for a £500m debt writeoff. The Co-op Bank chairman, Paul Flowers, is replaced by the former Alliance & Leicester boss Richard Pym.
August 2013 The bank reveals the then largest loss in its history – £709m – and warns that without new capital it will not be a going concern. Co-op members begin a campaign to prevent flotation.August 2013 The bank reveals the then largest loss in its history – £709m – and warns that without new capital it will not be a going concern. Co-op members begin a campaign to prevent flotation.
November 2013 Flowers, when questioned by the Treasury select committee about the Lloyds deal, shows a limited grasp of the bank’s affairs. The Mail on Sunday publishes a video showing him arranging to buy illegal drugs.November 2013 Flowers, when questioned by the Treasury select committee about the Lloyds deal, shows a limited grasp of the bank’s affairs. The Mail on Sunday publishes a video showing him arranging to buy illegal drugs.
December 2013 The Co-op Group hires the former City minister Lord Myners to review its operations for a £1 salary.December 2013 The Co-op Group hires the former City minister Lord Myners to review its operations for a £1 salary.
April 2014 The Co-op Group reveals losses of £2.5bn after the most “disastrous year” in the mutual’s 150-year history. The bank itself reports a £1.3bn loss.April 2014 The Co-op Group reveals losses of £2.5bn after the most “disastrous year” in the mutual’s 150-year history. The bank itself reports a £1.3bn loss.
May 2014 Flowers pleads guilty to drug charges. The Co-op’s stake in banking arm expected to shrink to 20% after rescue fundraising, which includes US hedge funds taking control of the bank. May 2014 Flowers pleads guilty to drug charges. The Co-op’s stake in its banking arm is expected to shrink to 20% after rescue fundraising, which includes US hedge funds taking control of the bank.
December 2014 The Co-op Bank fails Bank of England stress tests and agrees a plan to accelerate a disposal programme of risky assets.December 2014 The Co-op Bank fails Bank of England stress tests and agrees a plan to accelerate a disposal programme of risky assets.
March 2015 Booker is handed a potential £5m pay deal, prompting a row as he prepares to axe more jobs and close further branches. Losses more than halved in 2014.March 2015 Booker is handed a potential £5m pay deal, prompting a row as he prepares to axe more jobs and close further branches. Losses more than halved in 2014.
April 2015 The Co-op boss, Richard Pennycook, hails the end of the rescue phase as the group returns to profit and cuts debt. April 2015 The Co-op Group boss, Richard Pennycook, hails the end of the rescue phase as the group returns to profit and cuts debt.
June 2015 The Co-op Bank reveals it will begin settlement talks in July with the Financial Conduct Authority and the Bank of England after an 18-month investigation.June 2015 The Co-op Bank reveals it will begin settlement talks in July with the Financial Conduct Authority and the Bank of England after an 18-month investigation.
August 2015 The bank escapes a fine but a series of regulatory failures is found by the FCA and the Bank of England. Other investigations are continuing.August 2015 The bank escapes a fine but a series of regulatory failures is found by the FCA and the Bank of England. Other investigations are continuing.