Money alert: Co-operative Bank rescue plan

Simon Read
Friday 08 November 2013 22:00 GMT
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The Co-operative Bank has issued details of its rescue plan which involves handing over around 70 per cent of the business to a number of institutional investors, including hedge funds.

The deal will only be accepted if around 12,900 private investors who hold bonds in the bank agree to it. Doing so would mean getting worse returns on their bonds than they were previously entitled to receive.

But if the deal doesn't get voted through, the alternative could mean the Bank of England being forced to step in. If that were to happen bondholders could end up with nothing.

Mark Taber of the Co-op Bank Retail Investors Campaign said: "The deal is now a much better solution for retail holders and pensioners. Every stakeholder had to make concessions to arrive at this consensual restructuring to stabilise The Co-operative Bank."

What about customers? Many were attracted by the bank's ethical stance and bosses have promised that will continue under the new owners.

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