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Co-operative Bank Axes 400 Jobs In Major Restructuring 

The Co-operative bank branch

The Co-operative Bank has announced 400 job losses to streamline operations and reduce costs. 

This decision marks the bank's first significant restructuring since its rescue by hedge funds in 2017.

It is targeting a 12 percent cut from its current 3,000 employees. 

The layoffs will span the whole organisation, including its network of 50 branches.

This move comes amid discussions of a potential acquisition by Coventry Building Society.

However, the bank clarifies the job cuts are independent of these negotiations. 

The talks, ongoing since November, explore the possibility of Coventry Building Society purchasing the Co-operative Bank from its hedge fund owners.

Annual profits dropped by half in 2023

The announcement follows a report revealing a near-halving of the bank's annual profits to £71.4 million for 2023.

It’s significantly impacted by one-off expenses, including £29 million allocated for a compensation scheme for mortgage customers due to adjustments in its standard variable mortgage rate in 2011 and 2012.

The bank describes these layoffs as crucial to its ongoing transformation plan.

The plan includes efforts to simplify operations and a £100 million investment in new IT infrastructure. 

The restructuring aims to propel the bank into a new phase of strategic development, focusing on sustainable growth.

The Co-operative Bank has initiated a consultation process for the proposed changes.

It said: “The decision has not been made lightly, and the bank will continue to work closely with our trade union and to support impacted colleagues.”

The consultation period, which started on Tuesday, March 26, is set to conclude on May 7.

It is hoped, the job reductions will be finalised by the end of August.

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The bank is continuing its negotiations with Coventry, but both parties will need to make a formal agreement to continue the discussions after March.

A successful acquisition would return the bank to member ownership and establish a significant competitor on the high street, serving nearly five million customers.

The Co-operative Bank's journey has been tumultuous.

It saw a financial crisis in 2013 following a problematic acquisition and the scandal surrounding its former chair, Paul Flowers. 

However, the bank returned to profitability in 2022.

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