As the FT notes this morning:
The Co-operative Bank is preparing for multiple investigations lasting for years as regulators try to get to the bottom of the failures that unhinged the mutual.
As pressure mounts for the bank to finalise its restructuring plan, probes by UK regulators are expected to be announced imminently and the Treasury is preparing to order its own.
The timing is particularly sensitive because, over the next two weeks, the Co-op must secure approval from bondholders for a sweeping restructuring of its banking business.
It seems to me that there is an obvious solution here. The Co-op should walk away from this bank. It will only have 30% left at best anyway. What there is left is very much more the Britannia than it is the bank that existed pre that takeover. And there's not a hope of the Co-op ethos surviving now.
It's time to walk away, give up the 30% to the hedge funds and ask new owners to rename it the Britannia Bank.
For the sake of the Co-op movement it would be the best thing to do whilst requiring those who made the mess - many now retired - to full co-operate with any investigation.
And what we then need is a proper mutual bank for the UK.
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I think you are right on this point. As I understand the cooperative group will need to put considerable funds to secure their partnership with the vulture funds. Putting an “ethical” cherry on dog muck will change nothing. “Ethical” is a creepy priggish term, unless there are live democratic processes to set norms. The fact is that operative democratic process are near dead in the mainstream mutuals and cooperatives. If folk are serious about creating viable alternatives to the mainstream economy then a revival of cooperative and mutual membership engagement is needed to keep functionary capture at bay. This can become the basis of an emergent economic citizenship which can underwrite such notions as the “Courageous State”. Thinking and working on alternatives is need.
Any ideas for where current Co-operative customers should go?
I looked into Credit Unions, but they don’t seem able to provide all the services we are now used to, particularly online and telephone banking which the Co-op has always been good at.
Unity Bank is one idea – but 25% Co-op owned
I ma going to have to search for myself….
after researching the options to co-op I’ve moved to reliance, concluding that they were least worst.
The Unity Trust Bank do not operate personnel accounts.
Some of the bigger Credit Unions have a limited current account service, they issue debit cards, and standing orders can be set up. See the ABCUL web site.
Some of bigger surviving building societies offer current accounts but these enterprises are usually very corporate with nugatory democratic accountability and fat cat salaries that go with such cultures.
Some banking based on democracy, with alive membership interest, is our best bet, to prompt a beginning of a more equitable economic emergence, finance being one of the key components. Democracy may not be perfect and enterprises based on these principles are as good as people do them but governance based on one person one vote has an equitable tendency as the Chartists knew. These set up a host of mutual enterprises based on these principles before the universal franchise. Mutuals and cooperatives need TLC from there membership and much of these principles can be also applied to some of the surviving public sector such as the NHS, we need to reclaim these as ours.
Would the co-op be able to gain respect after this situation ends. I appreciate that its not going to end any time soon. Do people trust the co-op anymore??
There are 6,000 co-ops in the UK
The problem is name association
Perhaps the Co-op could abandon banking and go into energy instead.
Try Co-op Energy
I already buy from them
Also the Phone Coop. Highly recommended.
I do sympathise with all the people who feel let down by the Co-Op Bank’s behaviour. And Richard, I broadly agree: the Co-Op Bank is in no way a cooperative now and the name should be changed. I believe Vince Cable is still to rule on whether the Co-Op Bank will be able to retain the name anyway once it is 70% owned by hedge funds. Renaming it the whole thing Britannia would be popular with Britannia customers.
I’d like to warn those thinking of moving from the Co-Op to do their homework very thoroughly. The Co-Op is the market leader in provision of clearing services to credit unions and small building societies. So if you move your current account to a credit union you may well still end up banking with the Co-Op, just at arm’s length.
The Co-Operatives Movement has a conference in Manchester on Friday 14th January to discuss all of this: “Co-Op Bank Crisis: Ways forward for the Co-Operative Movement”. I’m speaking, along with (among others) Laura Willoughby of Move Your Money, Shaun Fensom of Save Our Bank and John Mann MP of the Treasury Select Committee. I hope this link to the flier works:
https://www.dropbox.com/s/blle2jxakd2swgl/Ways_Forward_Conference_flier%20%281%29.pdf
Thanks – fair comment
And for example, Unity bank is 25% Co-op bank owned. The union involvement is real – but the banking is Co-op through and through