Customer loyalty will keep Co-op off the rocks
This unusual attachment rather gets the Bank of England off the hook
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.The Bank of England has cause to be grateful to the Co-operative Bank’s unusual customer base. Co-op, remember, is the “nice” bank, the one people go to if they don’t want their money lent to nasty regimes, eco-unfriendly organisations, companies that exploit workers.
These people are likely to stick with it despite Moody’s warning that it may need “external” support (a bailout to you and me, from either the Government or the wider Co-operative Group) if its commercial property losses worsen.
Co-op says it’s working to plug a finance hole which could be as much as £1bn. Moody’s says it isn’t doing enough.
If a bank looks shaky there are good reasons for pulling out: customers with less than £85,000 on deposits know they’ll get their money back under depositer protection. But would you want to have to wait weeks or months?
Co-op customers, however, are unusually attached to their bank – which rather gets the Bank of England off the hook. It runs the Prudential Regulatory Authority, which was staying mum yesterday, as the Bank is wont to do.
“We don’t comment on individual companies,” I was haughtily informed. That’s not good enough. The Bank ought to have said something to reassure. Nobody wants a repeat of Northern Rock. Runs on banks are dangerous. A word or two from the Bank of England would have calmed any lingering fears.
Co-op doesn’t look to be going the way of the Rock. Luckily for its regulator, its loyal customers will ensure that remains the case.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments