Co-op Bank finance chief replaced after £700 million rescue deal
John Worth will be replaced by current director Tom Wood.
The Co-op Bank is replacing its chief financial officer after completing a £700 million deal that saved the troubled lender from a potential collapse.
In a market announcement on Wednesday, the lender confirmed that John Worth was stepping down after just one year as finance chief, saying he had “played a key role” during an “important period for the bank”.
He will be replaced by Tom Wood, who currently serves as a director at the company and will continue his work as chief restructuring officer, pending regulatory approvals.
Chairman Dennis Holt praised the outgoing finance chief for his work in securing the bank’s future.
“We are immensely grateful for the significant contribution he has made over the past year, particularly for the role he played in enabling us to agree principles to sectionalise the Pace pension scheme. We wish him well in his future endeavours.”
The £700 million refinancing and restructuring package – agreed to by the Co-op Bank’s hedge fund investors earlier this summer but completed just weeks ago – saw the bank effectively sever its historic relationship with the Co-operative Group and separate itself from the wider mutual’s pension scheme.
The Co-op Group is set to report its own half-year results on Thursday and is likely to face questions regarding the deal, which saw it reduce its stake in the bank from 20% to around 1%.
The rescue package gives Co-op Bank the ability to meet regulations on long-term capital requirements, avoid it being wound down and allow it to continue as a stand-alone lender.
Mr Worth said: “I have very much enjoyed working with the board, executive committee and wider team during this critical period, and wish the bank every success following the recapitalisation.
“This is a great organisation, with values and ethics at its heart.”
Last month, the Co-op Bank said half-year losses had narrowed to £135.2 million for the six months to June 30 from £177 million a year earlier.
However, uncertainty regarding the rescue deal ahead of its September completion sparked an exodus of retail customers.
The Co-op Bank – which has around 4 million customers overall – said last month that it had lost around 25,000 current account customers since the end of last year, while £400 million of instant access savings cash was pulled out.
Loans fell to £15 billion from £15.3 billion a year earlier while mortgage completions dropped £100 million at £1.4 billion and redemptions almost doubled to £1.3 billion from £700 million a year earlier.
The group’s net interest margin – a key measure for retail banks – was affected by record low interest rates and competition in the mortgage market.