Four non-executives Co-op Bank directors resign

Co operative bankFour non-executives of co-operative Bank have resigned from the board of the bank as it looks to plug the £1.5 billion hole in its finances.

Following the resignation, the number of directors or senior executives has fallen to nine since the financial troubles of the bank began five months earlier. Len Wardle, group chairman, Duncan Bowdler, a buying manager for the Co-operative Group, as well as external non-executives Bob Newton and Peter Harvey have left the bank.

All the four directors would remain on the board of the parent company Co-operative Banking Group indicating that the bank would become more independent from its parent company. Bank has revamped its board to increase its independence and comply with corporate governance rules ahead of its 1.5 billion pound rescue plan.

The bank needs £1.5 billion to fill the gap in its finances and the management is also considering cutting or cancelling income paid to the bond holders of the bank. Sutherland, the chief executive of the Co-op Group has urged for support of the bank plan to revive the organisation, saying that it represents the best interest of the stakeholders. Under the plan, bondholders will provide £500 million of capital for revival of the bank. The group reported loss of £709 million, mainly due to a loss of £559 million in the banking arm that is facing £496 million bad debt charge.