£2.5bn loss expected for the Co-op

THE beleaguered Co-operative Group is expected to report losses of £2.5bn later this morning.

It has been struggling since unearthing major losses at its bank last year, and has also been rocked by boardroom turmoil.

Yesterday the former chairman of the bank, Paul Flowers, was charged with the possession of drugs, and last month chief executive Euan Sutherland resigned, branding the organisation as ungovernable.

Paul Myners, who was brought in to draw up reforms – and is also leaving next month, has blamed the massive losses on former management. Writing in the Daily Mirror he said they were “allowed to run amok like kids in a sweet shop”.

“They bought up businesses willy-nilly – from Britannia Building Society to Somerfield supermarkets – and made catastrophically inept decisions over and over again. In the process they crippled the group with huge debt.”

The acquisitions and the bail out of the bank have saddled the group with debts of around £1.2bn. The group is not expected to pay a dividend to members for several years.