Welcome to this, our first newsletter of 2024, from the Customer Union for Ethical Banking, the independent union for customers of The Co-operative Bank.

In this newsletter, an update on the merger talks between the bank and Coventry Building Society and what it means for us; the bank picks up the Ethical Markets Report after a ten-year hiatus; and some bad news for Barclays.

Co-op and Coventry enter exclusive talks

Coventry Building Society branchWe reported in our December newsletter that the Coventry Building Society had made an offer to buy the Co-op Bank. Since then the Bank and Coventry have entered 'exclusive' merger talks. We commented to the Financial Times (paywalled) which first broke the story:

"The Customer Union for Ethical Banking, the independent union for Co-op’s customers, said a successful deal would “align perfectly with our dual goals: preserving the bank’s world-leading ethical standards and steering it back towards some form of mutual or co-operative ownership.”

The Guardian’s coverage also referred to the Customer Union.

A common theme to the coverage was that this could lead to an effective 're-multualisation' of the bank. We'd point out that the bank was never a mutual in the first place, rather it was owned by a mutual. A successful merger would however return the bank to being owned by a mutual, which would be a very positive step.

What do merger talks mean for our work?

Last year we ran a successful crowdfunding campaign for the next ten years of the Customer Union, and with this new funding, began researching how to build a fund that can buy a cooperatively-owned shareholding in the bank. Given these merger talks, it makes sense to put that work on hold, and instead we have focused on looking into what this merger could mean for the bank and us, its customers.

We held a call with our “Technical Committee” of experts in finance, co-operatives and company law last month to learn more about the process and possible outcomes of these talks. We understand from their input that Coventry is likely to spend 3-6 months doing due diligence on the Co-op Bank - kicking the tyres, essentially, to make sure it knows what it might be buying and what final sum it makes sense to offer. Once a formal offer is made and accepted it might take a further 3-6 months for a deal to be completed, pending approval from the Bank of England’s Prudential Regulation Authority, the PRA, and approval from Coventry’s members.

If the merger does go ahead, there’ll be an interesting discussion to be had on the role of the customer union in the merged organisation - both among ourselves in the Union and with the organisation itself.

Bank returns as sponsor of Ethical Markets Report

Ethical Markets Report coverThe Ethical Markets Report tracks total UK ethical expenditure by consumers, and has done so every year for nearly a quarter of a century.

The Report began life in 1999 as an in-house project of the Co-operative Bank, and Ethical Consumer, which helped start the Save Our Bank campaign, joined as a project partner in 2006. The Co-op stepped back from sponsorship in 2013 when the Bank hit financial difficulty.

So it felt a bit like a full circle had been made when the Co-op Bank re-joined as sponsor for the 2023 report.

In a joint release with Ethical Consumer in December 2023, the bank noted how, despite a challenging economic backdrop, ethical markets had remained impressively resilient with a total value of £141 billion. They noted how certain sectors in particular were thriving, including sales of second hand clothes and sales of electric cars. For more information see the news story or download the whole report here.

Charities and churches ditching Barclays over fossil fuels

Banking on Climate Chaos coverTime to bask in a little schadenfreude as news has been pouring in in recent weeks about customers leaving Barclays – Europe’s biggest “fossil bank” and a member of the Banking on Climate Chaos “dirty dozen” – because of its dirty investments.

Sheffiled CathedralIn December, the Independent and others reported that “Sheffield Cathedral, the Community of Christ and Greenbelt Festival have announced their intention to move away from the bank, having been clients for more than 65 years combined.” News followed this week that Oxfam GB is withdrawing funding from the bank as well. See the story in The Times (paywalled) or here on CivilSociety.org. The move follows similar steps taken by Christian Aid last year. The National Trust has so far resisted calls to leave - you can write to them about this here.

This all shows the value to the Co-op Bank in having an ethical policy commitment not to finance companies involved in the extraction and production of fossil fuels.

Customer Union membership renewals

Many (but not all) members' subscriptions come up for renewal mid February. If you're one of them we hope you are happy to renew - you'll receive an email inviting you to do so, just click on the link in the email (Direct Debit payers are renewed automatically). If you're not a member yet, you can join here - just £15 a year.

Please do contact us if you have any questions - support@saveourbank.coop

That’s all for this month’s newsletter; thank you as ever for reading and supporting the Union.

With best wishes,

The Save Our Bank team

Have you joined the Customer Union yet? It costs £15 a year to be a member of the first ever customer union co-operative, and help us ensure the Co-op Bank sticks to its principles. It only takes a few moments to sign up here.