{{Short description|Bank in the UK}} {{Distinguish|Co-operative Legal Services}} {{Infobox company | name = Co-operative Banking Group | logo = Co-operative Banking Group.png | logo_size = 300px | type = Limited company owned by a consumer co-operative | predecessor = CIS (founded 1867) | foundation = {{Start date|2002}} | defunct = 2013 | location_city = CIS Tower, Manchester | location_country = {{Nowrap|United Kingdom}} | key_people = Richard Pym (Chairman)<br>Niall Booker (Chief Executive) | industry = Financial services | products = Banking and Insurance | revenue = GBP 1,116.7 million | members = | num_employees = | parent = The Co-operative Group | homepage = {{Nowrap|{{url|www.co-operativebankinggroup.co.uk}}}} }}
'''Co-operative Banking Group Limited''' (originally '''Co-operative Financial Services''')<ref>Registered in England and Wales under the Companies Act 1985, No. IP29379R</ref> was a UK-based banking and insurance company and a wholly owned subsidiary of The Co-operative Group. Established in 2002, its head office was located at the CIS Tower, Miller Street, Manchester.
It was mainly known through its two main subsidiaries: The Co-operative Bank (incorporating Smile, the first full internet bank in the UK) and The Co-operative Insurance. Co-operative Financial Services was formed as a holding company to bring these financial subsidiaries together under one umbrella society and to enable synergies between the businesses to be exploited. Following the Co-operative Bank's financial crisis in 2013, the group sold a majority of shares in the business, retaining a 20% stake.<ref>{{cite news |url=https://www.reuters.com/article/coop-fundraising-idUSL6N0NW09H20140510 |title=UK's Co-op Bank completes 400 million pound fundraising |author=Matt Scuffham |publisher=Reuters |date=10 May 2014 |accessdate=27 August 2020}}</ref> As a result, the group was reorganised, and the banking group structure was discontinued.
==History== In 2007, the Group agreed to outsource its information systems to Xansa (now Sopra Steria). In 2008, Co-operative Financial Services was Business in the Community's Company of the Year, having been recognised at their Awards for Excellence gala dinner for making sustainable development a top priority in how it operates and in the products and services offered to its customers. They also won an Impact on Society Award, given to companies that are improving their business and their overall impact on society in the marketplace, the workplace, the environment and the community, through leadership and integration of its corporate responsibility practices.<ref>[http://www.bitc.org.uk/about_bitc/our_company_of_the_year/index.html/ Company of the Year 2008] {{Webarchive|url=https://web.archive.org/web/20090226141918/http://www.bitc.org.uk/about_bitc/our_company_of_the_year/index.html |date=2009-02-26 }} Business in the Community (retrieved 2 February 2009)</ref>
On 21 January 2009, Co-operative Financial Services and Britannia Building Society proposed a merger, with the new "super-mutual" being brought under the stewardship of The Co-operative Group.<ref>[http://news.bbc.co.uk/1/hi/business/7841581.stm Britannia and Co-op are to merge] BBC News, 21 January 2009 09:46 GMT</ref> On 29 April 2009 the merger, the first under the so-called Butterfill Act, was agreed by Britannia members. On 1 August 2009 Britannia Building Society was legally dissolved and Neville Richardson, its last Chief Executive, became Chief Executive of the enlarged CFS.<ref>[http://www.britanniamediacentre.co.uk/Content/Detail.aspx?ReleaseID=246&NewsAreaID=2 Merger Creates Powerful Force in Financial Services]{{Dead link|date=June 2018 |bot=InternetArchiveBot |fix-attempted=no }} Britannia Media Centre, 3 August 2009</ref><ref>[http://www.thenews.coop/news/Retail%20Societies/1614 New-look CFS ready to take on the banks] {{Webarchive|url=https://web.archive.org/web/20110718162904/http://www.thenews.coop/news/Retail%20Societies/1614 |date=2011-07-18 }} Co-operative News, 4 August 2009</ref> The resultant "super-mutual" had assets of £70 billion and 9 million customers.<ref>{{cite news|newspaper=Financial Times|url=https://www.ft.com/content/68a6be86-cb91-11e3-8ccf-00144feabdc0|title=Power struggles tear at the heart of 'ungovernable' Co-op|author=Sharlene Goff|date=24 April 2014}}</ref>
As of June 2011, Co-operative Financial Services was reported to be close to appointing Credit Suisse to advise it on a potential bid for the 600+ branches, and a large chunk of mortgage business, that Lloyds Banking Group was ordered to sell by the European Commission.<ref>Lloyds prepares to axe another 15,000 jobs, ''The Sunday Times'', 12 June 2011</ref>
In July 2011, the chief executive Neville Richardson was replaced by Barry Tootell, who became acting chief executive of Co-operative Financial Services. Peter Marks, chief executive of Co-operative Financial Services' parent company The Co-operative Group cited Neville's desire to step down as the reason for the change.<ref>{{cite news|title=Richardson to quit Group role|url=https://www.thenews.coop/36207/sector/retail/richardson-quit-group-role/|date=2 August 2011|work=Co-operative News}}</ref><ref>http://www.co-operative.coop/corporate/Press/Press-releases/CFS/Neville-Richardson-to-leave-Co-operative-Financial-Services/ Co-operative News, 22 July 2011{{dead link|date=July 2018}}</ref> In September 2011, Co-operative Financial Services became the Co-operative Banking Group. In December 2011 Lloyds Banking Group announced that Co-operative Banking Group was its preferred bidder for the assets which it was selling to comply with EU competition regulations, and that the two parties would be entering into exclusive talks.<ref>{{cite news|url=https://www.bbc.co.uk/news/business-16174571|title=Lloyds names Co-op as preferred buyer of bank branches|accessdate=12 February 2012|publisher=BBC News|date=14 December 2011}}</ref>
==2013 financial crisis== On 24 April 2013, The Co-operative Group announced it had withdrawn from purchasing the "Verde" business of Lloyds Banking Group after boards of the group and The Co-operative Bank decided that it was not in the best interests of the group's members to proceed further at the time.<ref>{{cite web |title=The Co-operative Group Announcement re: Lloyds Bank Branch Assets |url=http://www.co-operativebankinggroup.co.uk/servlet/Satellite?c=Page&cid=1357284286482&pagename=Corp/Page/tplCorp&currart=1366778903469&currmth=04 |publisher=www.co-operativebankinggroup.co.uk |access-date=22 June 2021 |archive-url=https://web.archive.org/web/20130601225958/http://www.co-operativebankinggroup.co.uk/servlet/Satellite?c=Page&cid=1357284286482&pagename=Corp/Page/tplCorp&currart=1366778903469&currmth=04 |archive-date=1 June 2013}}</ref>
In May 2013, after the recognition of inadequate capital levels in the banking group, Euan Sutherland took over from Peter Marks as Co-operative Group chief executive.<ref name=ft-20130602>{{cite news |url=https://www.ft.com/content/55253620-cb75-11e2-b1c8-00144feab7de |title=Co-op weighs up banking arm rescue plan |author=Anne-Sylvaine Chassany and Jennifer Thompson |newspaper=Financial Times |date=2 June 2013 |accessdate=4 June 2013}}</ref> That month Moody's downgraded the bank's credit rating by six notches to junk status (Ba3) and the bank's Acting Chief Executive Barry Tootell resigned.<ref>{{cite news | url=https://www.theguardian.com/business/2013/may/10/cooperative-bank-chief-quits-moodys-downgrade | title=Co-operative Bank rushes to reassure customers after downgrade | author=Rupert Neate and Jill Treanor | work=The Guardian | date=2013-05-10}}</ref> The difficulties stem largely from the commercial loans of the Britannia Building Society, acquired in the 2009 merger.<ref name=telegraph-20130605>{{cite news |url=https://www.telegraph.co.uk/finance/newsbysector/banksandfinance/10099921/Crisis-hit-Co-op-hires-ex-Morrisons-finance-chief-Richard-Pennycook-and-banker-Richard-Pym-for-restructuring.html |title=Crisis-hit Co-op hires ex-Morrisons finance chief Richard Pennycook and banker Richard Pym for restructuring |author=Rebecca Clancy |newspaper=Daily Telegraph |date=5 June 2013 |accessdate=5 June 2013}}</ref> The group intended to sell its life insurance business to Royal London, releasing about £200m in capital, and was planning to dispose of its other insurance business. Further financial restructuring was required,<ref name=ft-20130602/> and the option of the Bank of England taking over the ownership of the bank under the Banking Act 2009 had been considered.<ref name=bbc-20130712>{{cite news |url=https://www.bbc.co.uk/news/business-23279458 |title=What did regulators know about Co-op Bank? |author=Robert Peston |publisher=BBC |date=12 July 2013 |accessdate=13 July 2013}}</ref> Former HSBC executive Niall Booker was appointed Chief Executive of The Co-operative Bank.<ref name=ft-20130602/><ref>{{cite web |url=http://www.co-operative.coop/corporate/Press/Press-releases/Headline-news/Niall-Booker-Co-operative-Bank-Chief-Executive/ |title=The Co-operative Group appoints Niall Booker as Bank Chief Executive and Group Deputy Chief Executive Officer |publisher=The Co-operative Group |date=28 May 2013 |accessdate=5 June 2013 |archive-url=https://web.archive.org/web/20150304180120/http://www.co-operative.coop/corporate/press/press-releases/headline-news/Niall-Booker-Co-operative-Bank-Chief-Executive/ |archive-date=4 March 2015 |url-status=dead |df=dmy-all }}</ref> On 5 June Richard Pennycook, former finance director of Morrisons, was named Co-operative Group's finance director, and Richard Pym, former chief executive of Alliance & Leicester, as chair of the Co-operative Banking Group and the Co-operative Bank.<ref name=ft-20130605>{{cite news |url=https://www.ft.com/content/a6fde04a-cdab-11e2-a13e-00144feab7de |title=Co-op makes fresh changes at the top |author=Adam Jones |newspaper=Financial Times |date=5 June 2013 |accessdate=5 June 2013}}</ref>
==References== {{reflist}}
==External links== *{{official website|http://www.co-operativebankinggroup.co.uk/}} {{subject bar|auto=y|d=y}}
{{Co-operative Group}} {{Commercial and retail banks in the United Kingdom}}
{{DEFAULTSORT:Co-operative Banking Group}} Category:Co-operatives in the United Kingdom Category:Financial services companies of the United Kingdom Category:Banks established in 2002 Category:Banks disestablished in 2013 Category:Companies based in Manchester Category:Cooperative banking in Europe Category:2002 establishments in the United Kingdom Category:Insurance companies of the United Kingdom