Co-operative Bank seeks to raise further £400m

The Co-operative Bank is attempting to raise an additional £400 million three months after completing a £1.5 billion recapitalisation, as a wave of fresh conduct charges have weakened its financial position.

The bank disclosed yesterday that it would take £400 million of provisions for issues including mis-sold consumer products and a breach in the Consumer Credit Act, pushing it into an underlying pre-tax loss of £1.2 billion-£1.3 billion for last year.

It warned its core equity tier one ratio would drop to 7.2 per cent at the end of 2013 – only a fraction above the 7 per cent regulatory minimum and significantly below its previous guidance of up to 9 per cent.

The bank has launched a rights issue to raise £400 million from existing shareholders. – (Copyright The Financial Times Limited 2014)