Overcast

Overcast

max temp: 6°C

min temp: 4°C

Search

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

PUBLISHED: 09:22 17 April 2014 | UPDATED: 16:31 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.

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.

A Felixstowe man brandished a pruning saw during a late night fight with neighbours at a block of flats in the town, a court has heard.

Forecasters are predicting a cold start to the beginning of March as temperatures struggle to rise above freezing.

A Suffolk girl who braved the North Sea for the hospice that cared for her great-grandmother has been named Ipswich Town FC’s “Community Champion”.

An Ipswich care provider which helps support people with complex needs in their homes has been given an ‘inadequate’ rating by a health watchdog after a catalogue of issues were found.

A much-loved free music event is returning to a Suffolk resort this summer after a two-year absence – and organisers hope it will raise a big sum for charity.

Traffic heading in and out of Ipswich along Wherstead Road has been plunged into chaos as Anglian Water engineers moved in to replace the cover of an underground tap.

Pin Mill is a popular destination for sailors, walkers, artists, photographers and those visiting the centuries old Butt and Oyster public house.

Top development projects in Suffolk and Essex are set to go head-to-head at an annual regional awards ceremony, which will be held in Bury St Edmunds.

Police have launched a search for a 13-year-old girl from Bradford who went missing while visiting family in peterborough.

This year’s High Sheriff Awards have been presented to a selection of Suffolk’s most devoted charitable individuals and organisations.

Most read

Show Job Lists

Topic pages

Newsletter Sign Up

Sign up to receive our regular email newsletter
MyDate24 MyPhotos24