Board Governance

Role and Responsibilities of the Board

The Board has collective responsibility for the long-term success of the Bank. Its role is to provide leadership of the Bank within a framework of prudent and effective controls which enables risk to be assessed and managed. It sets the Bank's values and standards and ensures that its obligations to its shareholders, customers and other stakeholders are understood and met.

The Board sets the Bank's strategy and approves plans presented by management for the achievement of the strategic objectives it has set. It determines the nature and extent of the principal risks it is willing to take in achieving its strategic objectives and is responsible for ensuring maintenance of sound risk management and internal control systems.

The Board has approved a schedule of Matters Reserved for the Board and authorities delegated to the Chief Executive Officer (CEO). Both the Matters Reserved for the Board and the CEO's delegated authorities have been revisited by the Board and re-adopted for 2021 with appropriate enhancements. Such reserved matters include decisions on strategic and long term objectives, the approval of published financial statements, major acquisitions and disposals, significant investments and other capital expenditure, and approval of the Bank's risk appetite and its Risk Management Framework. Implementation of the strategy set by the Board and the management and day-to-day running of the Bank is delegated to the CEO, with oversight by the Board, with the exception of the Matters Reserved for the Board.

Composition

During 2019, the following changes to Board membership occurred: Sue Harris was appointed to the Board on 7 May 2019 and Sally-Ann Hibberd was appointed to the Board on 1 August 2019.

The Bank regards Derek Weir, Glyn Smith, Sir Bill Thomas, Sue Harris and Sally-Ann Hibberd as Independent Non-Executive Directors. Robert Dench has been regarded as an Independent Non-Executive Director since his appointment to the Board on 1 February 2018. He was appointed as Chair on 14 March 2018.

Derek Weir, Chair of the Risk Committee, was appointed as Senior Independent Director on 5 April 2018.

All the Non-Executive Directors have considerable experience and make valuable contributions to the Bank. The Non-Executive Directors constructively challenge and help develop proposals on strategy and bring strong, independent judgement, knowledge and experience to the Board's deliberations. The Non-Executive Directors are of sufficient calibre and number that their views carry significant weight in the Board's decision-making.

Nick Slape was appointed as Chief Financial Officer on 3 December 2018, appointed to the Board on 9 December 2019, and assumed full CEO responsibilities on 31 October 2020. Louise Britnell was appointed as Chief Financial Officer on 31 October 2020 and appointed to the Board on 1 March 2021. Having joined the Board as Chief Operating Officer on 23 July 2019, Chris Davis stepped down on 31 October 2021.

Director Appointment Rights

Under the Articles of Association adopted on 21 August 2017, and as amended on 22 May 2018, 21 May 2019, 29 August 2019 and 19 May 2020, the Company's ultimate parent company, The Co-operative Bank Holdings Limited, is entitled to designate any two Directors as 'B Directors'.

Chris Vogelzang and Paul Copley were appointed as designated B Directors on 1 September 2018 and Morteza Mahjour was appointed as a designated B Director on 12 December 2019. Chris Vogelzang stepped down as a Non-Executive B Director on 18 June 2019 and Paul Copley stepped down as a Non-Executive B Director on 31 December 2019. Morteza Mahjour stepped down as a Non-Executive B Director on 31 December 2020.

Richard Slimmon and Sebastian Grigg were appointed as designated B Directors on 11 January 2021.

The fifth Capital Requirements Directive (CRD V) requires an institution such as the Bank to include a compliance statement on its website in relation to certain articles contained in CRD V. A statement of the Bank's compliance with CRD V governance, remuneration and reporting can be found on the Compliance with Capital Requirements Directive page.

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