Co-op Bank executive calls for review at CWS
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Your support makes all the difference.Terry Thomas, managing director of the Co-operative Bank, yesterday ended his outspoken nine-year reign with a call for a radical review of operations at its owner, the Co-operative Wholesale Society.
The criticism followed the high-profile and failed attempt by Andrew Regan, the youthful entrepreneur, to take over the mutually owned CWS this year. The Crown Prosecution Service recently dropped the case against Mr Regan, his business partner David Lyons and Allan Green, a former CWS executive, to allow police more time to investigate the affair.
Though Mr Thomas declined to comment directly on the events, he suggested the CWS board should compare its fortunes with the growing success of the Co-op Bank. Presenting his last set of financial results before his departure at the end of the month, he revealed a 32 per cent jump in half- yearly pre-tax profits to a record pounds 33m.
Mr Thomas said the CWS was studying a consultants' report on its business delivered a few days ago. "We hope they'll do a root and branch review," he said. "I'm just confident that they'll put their house in order. They don't need to be told that they cannot continue as they are with them losing market share."
He implied the CWS had drifted from its founding principles. "The significant thing the bank has done is to go back to its roots. Perhaps you can lose the thread a bit. I'm not saying they did that but it's possible."
The Bank yesterday paid tribute to Mr Thomas, who joined the organisation as its first marketing manager in 1973. In the past decade the Co-op Bank has grown rapidly by targeting higher-income customers with products such as gold cards.
Responding to criticism that the Bank had only grown by moving away from its original customer base, Mr Thomas argued the co-operative pioneers were middle class.
"It would be foolish to think they were men of the soil or hewers of rock," he said.
Retail deposits at the bank grew 23 per cent in the six months to 26 July to pounds 2.8bn while average retail lending increased by 11 per cent to pounds 2.25bn. Bad debt provisions rose by 14 per cent to pounds 13.4m, though they were of the same 1.1 per cent proportion of account balances as last year.
Mervyn Pedelty, an accountant and management consultant who will take over from Mr Thomas in October, yesterday pledged to maintain the ethical campaigns.
Asked whether the ethical investment stand had won over other banks, Mr Thomas replied: "Unfortunately not." He cited a Co-op Bank conference against land mines, where only five smaller banks agreed to stop doing business with companies involved in the trade.
People & Business, page 21
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