The Co-operative Bank has joined Co-operatives UK - the federal body for UK Co-operatives.
A message to the Bank on its Ethics consultation
The Co-operative Bank has appointed Laura Carstensen, a commissioner at the Equality and Human Rights Commission, as the new chair of its values and ethics committee. Laura Carstensen was previously a partner at lawyers Slaughter and May and is a former deputy chairman of the UK Competition Commission.
The bank is saying it has met its capital raising target sooner than expected with commitments from shareholders totalling £400m. This includes the Co-operative Group who, as expected, will be diluted to 20% but will remain the largest single shareholder.
In the news release, chief exec Niall Booker is quoted:
Ed Mayo, general secretary of Co-operatives UK (the UK federation of co-operatives) has indicated that the bank could retain the "Co-operative" name despite the fall in the mutual share to just 20% - providing "the values demonstrate the co-operative worth of the bank going forward". The statement draws attention to the fact that other organisations are in a similar situation.
The bank today issued a press release detailing its plan to raise £400m additional capital.
It says it is confident it will raise the money, and that it has commitment from 5 largest shareholders, including The Co-operative Group, to subscribe to new shares.
The Co-operative Group responded:
Bank claims it is on course to raise £400m more - but Co-op Group share will fall
A report in the Telegraph suggests that the Co-operative Group will sell some of its entitlement to the planned rights issue by the bank. The rights issue is designed to raise £400m and there has been doubt that the Group - which has serious financial difficulties - would be able to find £100m+ needed to keep its stake at 30%.
The Kelly review into what went wrong at the bank was published today.
In its response the Co-op Group welcomed the report. Richard Pennycook said: "the management that instigated this disaster for the Group are no longer in place; the flawed governance structure that failed to apply the right checks and balances, however, remains."