Co-op Bank ‘highly confident’ after investor vote

THE Co-operative Bank said there had been “overwhelming support” for its £1.5bn rescue plan by retail investors.

In a statement issued late on Friday after a voting deadline, the bank said 99.9% of votes submitted by holders of preference shares and two tranches of junior debt were in favour.

At least 75% of the vote was required. The bank and the Co-op Group said they were “highly confident” that the recapitalisation plan will now go ahead.

The group has previously warned that the bank could go into “resolution”, effectively taken over by the Bank of England, if the plan was not backed.

In October the Co-op Group admitted it had been forced to agree a debt for equity swap with large bondholders that will leave it with 30% of the bank when it floats on the stock market.

Large bondholders, which are backing the deal, have agreed to put in £125m of new capital alongside £462m from the Co-op Group.

Smaller retail investors have been given an option of a lower annual payment in exchange for a future lump sum, or maintaining existing annual payments for 12 years without future capital.

In a statement the group said: “The Co-operative Group and The Co-operative Bank are delighted at the overwhelming levels of support for the liability management exercise at this critical juncture, and we would like to thank all our bondholders and preference share holders for backing the recapitalisation plan.

One more vote is being held, for holders of dated notes, who will vote on December 11.