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Co-op Bank receives bids from 'credible' buyers

Co-op Bank receives bids from 'credible' buyers

The Co-operative Bank has revealed it has received a number of “credible” bids from potential buyers.

In an update on the sale process issued this morning (24 March), the bank stated these bidders are currently evaluating information on the provider.

A statement to the London Stock Exchange read: “The bank has requested that preliminary expressions of interest should be submitted in the first half of April.

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“Following an assessment of those preliminary expressions of interest, the bank plans to proceed to a second phase of the sale process where selected parties will be provided with additional information in order to continue their due diligence with a view to making an offer for all of the issued ordinary share capital of the bank.

“There can be no certainty that an offer for the bank will be made, or that any offer that is made will be on terms acceptable to the bank and its shareholders.”

The bank was put up for sale in February after it struggled to strengthen its capital position because of low interest rates and higher than expected costs.

It has warned it will struggle to meet its capital reserve targets in the medium term.

A few months ago the bank made 200 roles redundant to mitigate the impact of a prolonged low interest rate environment.

The bank was plagued by scandal in 2013 when then-chief executive Paul Flowers was forced out of the bank.

That year it was rescued by a group of hedge funds after it emerged it had a capital shortfall of £1.5bn and it is currently only 20 per cent owned by The Co-operative Group.

In 2015 the bank escaped a £120m fine from the Prudential Regulation Authority for “serious and wide-ranging failings” in its control and risk management framework, after a greater financial penalty was deemed not to advance the safety and soundness of the firm.

Earlier this month the bank announced a loss of £477.1m for 2016.