Co-operative Bank upgrades forecasts as profits reach £100m

Co-operative Bank chief executive Nick Slape

The Co-operative Bank has increased its forecasts for this year after a strong performance in the third quarter.

The Manchester-headquartered finance group’s pre-tax profits for the first nine months of the year are just over £100m and it is “now fully capital compliant including all buffers for the first time since 2013”.

Nick Slape, who has been Co-op Bank’s chief executive for the past two years, said: “Our turnaround progress is ahead of schedule, which reflects the strong financial performance and sustained focus on risk management over many years.”

The Bank has upgraded its net interest margin from 155 to 165 basis points, just four months after a previous increase. This reflects the higher market rates “alongside continued lower mortgage margins”.

Despite the rising interest rates and other economic pressures affecting customers, the Bank said it is “currently seeing no signs of stress across our portfolio”.

“We have a low risk balance sheet with limited exposure to unsecured and corporate lending,” it added.

The Co-operative Bank, which is 150 years old this week, is also increasing investment on the back of the strong performance.

Slape added: “We have delivered significant business momentum, and in light of this performance, have taken the decision to increase our investment in the business.

“This will centre on improving customer experience, upgrading our branch network, and increased funding of our external campaign, giving the Bank a louder voice on matters that mean the most to our customers.”