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Key messages

  • In February 2017 we announced that we were commencing a Formal Sale Process under the Takeover Code, alongside considering other options to build capital, to meet the longer term capital requirements applicable to all UK banks.
  • The Bank needs to build its capital due to a number of factors, which have changed since we launched our turnaround plan, including much lower for longer interest rates and greater than expected costs.
  • At this point (19 June, 2017) we are in advanced discussions with a group of existing investors with a view to a prospective equity capital raise and liability management exercise.
  • No decisions have been made yet and any outcome is, of course, dependent on agreeing an offer that is right for our key stakeholders, in particular our customers.
  • Today’s announcement does not in any way affect the products customers hold with us, or the service we provide.
  • We thank customers for their continued support and loyalty.

 

Q&As

Q.1 What does this mean for me as a customer?

  • We understand that media coverage can be unsettling, however, today’s announcement does not affect the products you hold with us or the service we provide. We remain committed to providing the customer service that our 4 million valued customers expect from us. 
  • This is about finding the best solution to secure the long term the future of the Bank.
  • We believe there is great value in our distinct position in the market and that the relationship we have with customers, centred on our values and ethics, sets us apart and remains a key reason why customers choose to bank with us.

Q.2 Why are you having to go through this process?

  • In February 2017 we announced that we were commencing a Formal Sale Process under the Takeover Code, alongside considering other options to build capital, to meet the longer term capital requirements applicable to all UK banks.
  • This is about finding the best solution to secure the long term the future of the Bank.
  • Any final outcome will be dependent on agreeing an offer that is right for our key stakeholders, in particular our customers.

 Q.3 Is my money safe?

  • Like all banks, customers are protected by the Financial Services Compensation Scheme (FSCS), an institution which covers customers of all banks for up to £85,000 of retail deposits.
  • This announcement does not affect the products customers hold with us, or the service we provide.
  • Very importantly, we exceed, and continue to expect to exceed our minimum capital requirements (called Pillar 1 capital) and maintain sufficient liquidity to meet obligations.

Q.4 I have seen lots of media coverage about the Bank. Should I close my account? 

  • We accept that analysts and journalists will have different opinions on the Bank’s turnaround given the complexity of the challenges the Bank faces.
  • We have made significant progress and improvements from the position the Bank was in of 2013, and the announcement today is the best route forward to enhance our capital position.
  • We have worked hard to rebuild our retail banking proposition, differentiated by our values and ethics and strong customer service, which we know is valued by our customers.
  • This update does not in any way affect the products customers hold with us and the service we provide.
  • We thank customers for their continued support and loyalty.

Q.5 Why should I stay as a customer?

  • We believe that The Co-operative Bank has a valuable role to play in providing customers with a different choice in the market, set apart by the values and ethics that remain a key reason why customers choose to bank with us.
  • Ensuring that these continue to sit at the core of the Bank is vital and we are delighted to be celebrating the 25th anniversary of our customer-led Ethical Policy during 2017.
  • We have worked hard to rebuild our retail banking proposition, differentiated by our values and ethics and strong customer service, which we know is valued by our customers.
  • This latest update is about finding the best solution to secure the long term the future of the Bank.