The Co-operative Bank has shed 13 per cent of its permanent employees, as the battered lender presses forward with a turnaround plan aimed at shoring up its financial stability and addressing past governance failings, writes FastFT.
The bank posted a pre-tax loss of £76m for the six months ended in June, far narrower than the £845m loss recorded in the same period of 2013, as both operating costs and impairment charges on bad loans fell.
But the lender is far from being out of the woods after a torrid 2013, which saw the it bailed out by investors, including a group of hedge funds, after large losses on loans and misconduct charges left it facing a yawning capital gap.
Its former chairman, Paul Flowers, was also fined for possessing cocaine and methamphetamine.
Said chief executive Niall Booker on Friday: “Considering the scale of the challenge we faced a year ago we are encouraged by the progress made to ensure the stability of the bank.
“By the measures of capital and liquidity the bank is considerably stronger than it was a year ago. We are ahead of schedule in the disposal of non-core assets and have improved governance, particularly at board level.
“However, the issues we continue to face in building a sustainable business are deep rooted and there remains much to be done.”
One issue to watch is whether customers’ concerns over the bank’s ethical standards will erode its share of the UK current account market.
The bank said it lost about 28,200 accounts, on a net basis, in the first half - less than 2 per cent of its total.
The Co-op has shuttered 46 branches since the end of the year, reducing the size of its network by 16 per cent, with a further 25 branches to be closed in the fourth quarter.
