Co-op Bank structure questioned as deputy CEO stands down

Mr Bulmer, who will leave next year, is the latest senior executive to leave the struggling lender in the wake of its descent into crisis earlier in 2013, when it revealed a £1.5bn capital shortfall and pulled out of the ill-fated Project Verde.

A statement from the Co-operative Banking Group said Mr Bulmer, who had worked for the business for six years and took over as acting chief executive of the bank when Barry Tootell left in May, would “continue to play a crucial role in the running of the business” ahead of his departure.

However, a spokesman would not confirm if Mr Bulmer’s position would be replaced or if his departure would herald a further restructure of the bank.

Last week, a group of investors called the LT2 Group issued a statement through international advisory firm Moelis & Co, which called for the bank to convert its debt into equity, a move which could dilute the Co-operative Group’s ownership of the bank, and an alternative to the Co-op’s plans to recapitalise by converting bondholder assets into shares.

The statement called for “the bank’s board and its independent advisers to give serious consideration to the proposal, and engage in immediate and substantive discussions with the LT2 Group.”

Co-operative Banking Group chief executive Niall Booker is also to step down from his position as deputy chief executive at the bank’s parent in order to consider the LT2 approach and other third-party offers.

Investor group calls for consensual approach
Meanwhile, Mark Taber, a spokesman for more than 15,000 bondholders who could be affected by the so-called “haircut” being proposed by the Co-op, said the cutback would be a “very tall order”, and called for a consensual approach with the affected customers, many of whom are in their 80s