Newsletter June 2024

Welcome to this June newsletter from the Customer Union for Ethical Banking, the independent union for customers of The Co-operative Bank.

Our regular newsletter author Ryan is away on sabbatical, his place is taken by Rob with a bit of help from Shaun. Rob will be well known to readers of Ethical Consumer magazine.

This month’s newsletter has just one thing to report....

Coventry Building Society completes the deal to buy the Co-operative Bank

by Rob Harrison

Readers of the Save Our Bank newsletter will have noticed that, since November, our communications have been filled with discussion of and reflection on, these acquisition talks.  

Over the same period we have been suppressing a growing excitement that one of the core goals of our campaign, that the bank be returned to some for of mutual ownership, could be realised.

And it was on May 24th that both the bank and the building society announced they had completed the deal for the bank to be acquired by the society.

Bob Dench, chair of the bank said:

“This transaction sees The Co-operative Bank returning to mutuality. I am very proud of all those who have worked so hard over so many years to rebuild the Bank. I am sure the Coventry Building Society will prove to be a very good home for us.”

The announcement follows speculation in recent days that the talks were accelerating to avoid the transaction falling under the remit of the UK Takeover Code.

The bank told the Customer Union:

"this combination is compelling for all stakeholders, including The Customer Union, through providing improved products, value and service for both existing and new customers on a larger, more resilient scale. Both businesses share a complementary and powerful mutual/co-operative heritage which is increasingly relevant in modern society."

Although the deal is subject to the  approval of both the PRA and FCA, it is expected to complete in the first quarter of 2025.  We can find no reports which are suggesting that this will not take place, and we are certainly now in a celebratory mood here at the Customer Union.
 

Work still to be done

Of course there are always concerns when major events such as this take place.

Co-op News was one of a number of commentators to note that "members of the building society were not given a vote on the matter".  As was the case when no vote was held with the recent acquisition of Virgin Money by the Nationwide, it seemed a strange advert for mutuality that the acquisitions by the mutual sector taking place this year should happen this way.  

The Guardian also ran a headline saying "Co-op bank brand may disappear within years in Coventry Building Society deal".  However the substance behind this claim appeared to be no more than "Coventry declined to comment on long-term plans for the brand".

They then quoted Coventry as saying the banks will “continue to operate under their current names and branding while we carry out the work needed to provide a joined-up service. We expect this to take several years.”

The Guardian then said that "the building society also declined to comment on whether the Co-operative Bank’s ethical commitments would be maintained after the takeover. However, a spokesperson stressed that Coventry had obtained B Corp certification in 2023, which is meant to signal that a company upholds high standards in its dealings with staff, the community, customers and the environment."

Making sure that the Bank's ethical commitments are not lost was one of Save our Bank's two aims when we set up in 2013, and this will now become the focus of our work in the coming months.  Although there is no indication that Coventry intend to water any of it down, things can get lost unintentionally as organisations undergo upheavals, and we can play a role to make sure that this does not occur.  We are also likely to continue our work with Co-operatives UK to ensure that the combined group is as active in the co-operative movement as the Bank has become when it was on its own.

We are looking forward to continuing to represent our members' interests by working with the new teams to maintain the ethical leadership of a bank that continues to help raise standards across the banking sector more generally.
 

They said it was impossible

Shaun Fensom adds

Since we started the Save Our Bank campaign in 2013, we have had two aims: keep the bank to its ethical principles and work for an eventual return to mutual ownership.

We always knew the second aim was ambitious, but many said that it was impossible. They said we were naive.

Now, 10 years on, not only has the bank stayed true to its ethical principles – actually strengthening them – but with this acquisition it will return to mutual ownership.

Now, we think there is a new role to be played: helping the bank to lead the world again on its ethics, and building on its work over the recent years supporting the co-operative movement

 

That’s all for this month’s newsletter; thank you as ever for reading and supporting the Union.

And by the way, if you enjoyed this newsletter, why not share it on social media and Twitter, LinkedIn or Facebook and tag us there? This can help us reach new audiences, gain members and be a stronger union.

With best wishes,

The Save Our Bank team

Have you joined the Customer Union yet? It costs £15 a year to be a member of the first ever customer union co-operative, and help us ensure the Co-op Bank sticks to its principles. It only takes a few moments to sign up here.