Partly Cloudy

Partly Cloudy

max temp: 10°C

min temp: 3°C

ESTD 1874 Search

Retail/ Banking: Co-operative Group reports £2.5bn loss after ‘disastrous year’

09:22 17 April 2014

The Co-operative Group has reported an annual loss of £2.5bn.

The Co-operative Group has reported an annual loss of £2.5bn.

The Co-operative Group today confirmed an annual loss of £2.5billion amid the worst crisis in its history following the near-collapse of its banking arm.

shares

Interim chief executive Richard Pennycook said: “2013 was a disastrous year for the Co-operative Group, the worst in our 150-year history.

“Today’s results demonstrate that but they also highlight fundamental failings in management and governance at the group over many years.

“These results should serve as a wake-up call to anyone who doubts just how serious the challenges we face are.”

The bulk of the losses relate to the crisis that engulfed the Co-op’s banking arm when a £1.5bn hole was discovered in its finances, following its ill-fated purchase of the Britannia building society and attempts to buy more than 600 Lloyds branches.

A rescue deal means the majority of the bank is now owned by bondholders though the Co-op group remains the largest single shareholder with 30%.

But this stake may be further diluted after it said in today’s statement that it had still not decided whether to take part in a £400million rights issue after the lender said it needed to find more cash than previously thought.

The group said the cash call was an “opportunity, not an obligation” and that it would “consider the full details of the issue in due course”.

It will add to speculation about the possibility of the size of the group’s holding in the bank falling to such a low level that it may not be able to continue operating under the Co-operative brand.

Today’s figures showed the Co-op’s vast debt pile, built up during an acquisition spree which included the Somerfield supermarket chain, stood at £1.4bn.

This was down from £1.7bn in 2012, but comes as lenders are reported to be increasingly troubled by the run of boardroom disputes hampering plans to shake up the group’s corporate structure.

Bitter resistance to the planned changes saw chief executive Euan Sutherland step down last month while former City minister Lord Myners, architect of the reforms, will also leave after putting them to a members’ vote in May.

Group chair Ursula Lidbetter used today’s results announcement to stress the urgent need for change.

shares

3 comments

  • only the leadership of the COOP was made responsible for adhering to its mutual principles, but they are not, they are taking the mickey and the money of the COOP whilst the steering group is not holding these hot shots to account. There is nothing wrong with their ethical policy.

    Report this comment

    ingo wagenknecht

    Thursday, April 17, 2014

  • Paul Flowers, Lord Myners, useless puppets put into `jobs` for a reason.

    Report this comment

    John Bridge

    Thursday, April 17, 2014

  • This does not surprise me after seeing their prices, the miserable faces behind the tills and the rudeness of the staff talking to each other whilst serving you, especially in the Bradwell one.

    Report this comment

    "V"

    Thursday, April 17, 2014

The views expressed in the above comments do not necessarily reflect the views of this site

Matthew Embley,  RDC recycling services manager, left, and Gary Griffiths, RDC international partners compliance, with the company's gold Zero Waste award.

Information technology reuse and recycling company RDC has received a gold Zero Waste Award from the letsrecycle.com website.

Angela Rushforth, managing director of Ridgeons, with the firm's Investors in People gold accreditation.

Regional timber and builders’ merchant chain Ridgeons has been awarded a “gold” rating under ther Investors in People (IiP) programme.

Alex Till of Menta.

Suffolk-based Enterprise agency Menta and the county branch of the Institute of Directors (IoD) are working together to help Suffolk business owners as they strive for growth.

The water unit from the Prince's Street fire station with Ipswich with officials from the Port of Ipswich and students from Suffolk New College at the water safety demostration hosted by the port.

The Port of Ipswich teamed up with Suffolk Fire and Rescue Service to stage a rescue simulation off Orwell Quay.

From left, Chris Chamberlain from HTK, Vicki Cole from Crafted and Helen Dodman from Ipswich Central, the three organisations behind the Destination Digital conference.

The company behind the delivery of the Ipswich town centre Business Improvement District project has teamed up with two local digital specialist to stage a conference on online marketing for the tourism and hospitality sectors.

French Connection has warned that it faces a substantial loss when it posts its annual results.

Fashion chain French Connection today warned that it now expects to make a big annual loss after seeing its recovery hopes dashed by a difficult spring trading period.

Andrew Harrison, managing director of Stansted Airport.

Manchester Airports Group, parent company of Stansted Airport, scored a four-star rating in Business in the Community’s 2015 CR Index.

Dominic Casserley, group chief executive of Willis.

Global risk advice and insurance broking firm Willis has launched a 550million euro (£393m) offer to take full control of the French broker Gras Savoye.

Sainsbury's is to cut 800 jobs as part of a restructuring of its store operations.

Sainsbury’s is to cut 800 jobs as it becomes the latest supermarket to restructure its operations in the face of tough trading conditions.

The CWind Sword offshore support vessel.

Colchester-based offshore service vessel manufacturer CTruk has won an order to supply two more of its MPC22 boats to sister company CWind.

Most read

Most commented

Topic pages