Co-op Bank recovering after Paul Flowers fiasco

Paul Flowers

The Co-operative Bank says it is making a "significant improvement" after reducing its losses to £264.2m in 2014.

In 2013, the Co-operative Bank uncovered huge losses and narrowly avoided collapse. Its former chairman, former Rochdale Councillor Paul Flowers was fined for possessing illegal drugs.

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"There is still much to do to transform the organisation into a sustainable business," said the bank's chief executive, Niall Booker.

Mr Booker took over in 2013 following the emergence of the £1.5bn capital shortfall at the bank.

The bank was rescued by a group of investors, mainly hedge funds, who now own the majority of the bank's shares.

The bank said its strategy remained unchanged, focusing on reducing the bank's exposure to risk, making it more resilient and reinvesting in the Co-operative Bank brand.

The closure of a further 57 bank branches will contribute to lower direct retail costs. The bank has also seen a 4% drop in its total number of current accounts.

Mr Booker said: "We have always been clear that the journey to reshape the business would take time but I am confident that our approach to banking is as relevant in today's world as it ever was, and that we remain the bank of choice for anyone who shares the values and ethics which lie at the heart of our business."

Although the Co-operative Group now owns only a minority stake, the bank says it still adheres to the values of the co-operative movement.