Newsletter December 2024

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

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

The focus of this newsletter is a report back from our annual Gathering of members, held on Saturday 16th November, where we heard what Coventry Building Society has to say about the bank’s Ethical Policy.  

Before that, news at the end of November that the acquisition has received regulatory approval, is great to hear. We also note that the bank has awarded a dividend of £90m to shareholders ahead of the merger.
 

Gathering report 2024 part 1: the AGM

Before the “Gathering proper”, we started the afternoon with the formal Annual General Meeting of the Customer Union. Apart from the usual business of approving the minutes and accounts, we elected four new members to our Board of Directors. After an appeal for applications in a recent newsletter, we received applications to join the board from Peter Harris, Belinda Bell, Sue Loughlin and Leslie Freitag. All four were able to join us at the AGM and introduce themselves, setting out their diverse expertise in banking, credit unions, and campaigning. All four were subsequently elected to the board, joining the five existing board members to make a group of nine. We’re really pleased to have this injection of knowledge, ideas and energy into our supervisory body, and look forward to working together.

Gathering report 2024 part 2: the guest speakers

The first part of our two-hour Gathering is traditionally where we hear an update from a representative from the Co-op Bank, and sometimes other guest speakers, and have the opportunity to grill them with a long list of questions. This year, we were joined by Gary McDermott, the Chief Commercial Officer of the Co-operative Bank, and Emma Laycock, Head of Co-operative Advice at Co-ops UK. We were also pleased to be able to welcome a speaker from Coventry Building Society, Jeremy Cox, for the first time. Since the Building Society is expected to complete its purchase of the bank at the start of next year, we were all keen to hear his take on the plans for the merged organisation.

First up, Gary McDermott gave an update from the bank, including the successful completion of the integration of Britannia systems into the bank’s mortgage and savings platform, which has been a long time in the making. Gary also emphasised the benefits of the merger with Coventry. The bank offers services that Coventry does not, like personal current accounts, and current and savings savings accounts for small businesses (SMEs). He also stressed that there would be no material change for customers from Day 1 of the merger, with the bank name, service and branding staying the same as an initial integration period of perhaps two years begins.

Next, Jeremy Cox shared his enthusiasm for the acquisition, especially as it enabled the bank to return to customer ownership. He encouraged attendees to consider becoming members of Coventry Building Society by opening a savings account, in order to participate in shaping the future. He also made clear that, as the Building Society does not lend to businesses, he saw no barriers to the Building Society adopting the bank’s Ethical Policy, describing the merger as a “good opportunity to take the ethical lending policy and create a great fit.”

Finally, Emma Laycock set out the perspective on the acquisition from the UK’s apex co-operative body. It is Co-operatives UK that works with The Co-operative Bank on delivery of its co-operative values, in line with the criteria set out in a mutually agreed co-operative matrix. Adherence to the matrix criteria remains the critical factor to Co-operatives UK's ongoing support for the Bank continuing to use the word 'co-operative' in its name. Emma welcomed the merger as aligning with co-operative principles, and believes the continued use of 'co-operative' in a brand name would be viewed favourably by Co-operatives UK, although they would only be able to confirm when they can take a look at the new structure and the organisation’s future plans.
 

Gathering report 2024 part 3: questions and discussion

Members had a lot of questions for all our guest speakers, ranging from customer service and continued operation of branches to questions about ethics and membership. To pick up on a few interesting highlights from this session:

• There is hope that the merged organisation will be in a good position to pick up new business from larger organisations seeking an ethical option in sectors the bank had to abandon over the past decade, from local authorities to universities which have been pressuring their banks to stop funding fossil fuels.
• On branches, the merged organisation has only five branches in the same towns or serving overlapping areas, and has no plans to close these yet.
• Asked about the name 'Co-operative Bank', Jeremy said it “will probably fall away at some point”. He discussed some enthusiasm for bringing back the name “The Co-operative Building Society”, saying there used to be such a thing until 1970, when it changed its name to Nationwide. This is obviously speculative at the moment, but the idea resonates with us as well.
• Asked about the future of the Ethical Policy in the merged organisation, Jeremy said he could “commit that from day one, for the bank, it will absolutely stay in place.” This is reassuring, but while the Building Society is optimistic about the Policy applying across the whole organisation, we were not able to get a commitment on this yet.

Finally, we let our guests leave the Zoom room and ended the meeting with a discussion among members and supporters about the moment the Customer Union  finds itself in, and its future direction. Assuming the merger goes through, as everyone assumes it will, we can say with some comfort that the two goals we set ourselves back in 2012 have been achieved. The bank’s Ethical Policy is secure and looks like it could apply to a larger organisation than ever before, and the bank will soon be under mutual ownership. We could, at this point, agree we are done, declare victory and wind up the organisation. But there was a strong consensus that we have a clear role to play in championing ethical and cooperative values and representing our members’ interests, especially during the initial years when the merging of functions and policies will take place..

Looking ahead, we have some decisions to make about how to focus our resources and how to engage with the Building Society and its members. We’ll be considering the valuable input from members and supporters at this meeting as we set out our priorities and next steps.

Thank you to everyone who joined the Gathering, and to you for reading and supporting our work.

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.