Ex-Co-op chief Marks given rough ride by MPs

THE former boss of the Co-operative Group, Peter Marks, has described the current plight of its bank as a “tragedy” and said the mutual’s resources are stretched too thinly.

Mr Marks was appearing before the Treasury Select Committee at the House of Commons less than 24 hours after his successor, Euan Sutherland, was forced by hedge funds to announce a rescue deal for the Co-op Bank which will leave the group with just 30% of the lender.

At times Mr Marks, who stood down in May after a 40-year career at the Co-op, was given a torrid time by the MPs – one, David Ruffley, even accused him of “selective amnesia” over his role in the bank’s difficulties.

He said in hindsight the merger with Britannia Building Society in 2008 should not have been pursued – a decision he laid at the door of former Britannia BS chief executive Neville Richardson and David Anderson, the former head of the Co-operative’s Financial Services arm.

Mr Marks steadfastly refused to take responsibility for the current woes at the Bank, and argued that the lender was a victim of the economic crisis, and that the £1bn+ capital shortfall which emerged this year, was the consequence of financial regulators “shifting the goalposts”.

He said that the Co-op was not “Peter Marks PLC” and that all decisions surrounding the bank were taken unanimously by the group board and the separate bank board. “This is not a dictatorship” he added.

But he did lay blame at the archaic way in which the group board is structured – and said it was incapable of taking proper strategic decisions.

He said: “Of course I acknowledge that Britannia has turned out to not be a good deal for the bank. But I spent my life working for the co-op…it’s a tragedy what happened, but we did achieve a lot of success in the retail business. To say it was all a disaster would be wrong. The group, I think, still has a very good future,” he said.