Co-op in talks to sell Unity Trust Bank shares

The move follows a review by Unity of its ownership structure, and the new business plan unveiled by the Co-op to reshape its business around retail and small business customers

The Co-operative Bank
The Co-operative Bank

The Co-operative Bank is in talks over selling its 26% stake in the trade union-supported Unity Trust Bank.

The move follows a review by Unity of its ownership structure, and the new business plan unveiled by the Co-op to reshape its business around retail and small business customers.

Trade unions and union federations own more than 73% of the shares in Unity Trust, which was founded in 1984.

It is a small, specialist bank with retail deposits of around £616m, providing banking services to charities, unions, local councils and community groups.

Graham Bennett, chairman of Unity Trust, said: “We have started detailed discussions with our respective shareholders as part of our wider work to reposition the bank as we approach our 30th anniversary. The Co-operative Bank has been a fantastic supporter of Unity Trust since it was first founded. However, the time is now right to review our structure as we begin the next chapter of Unity’s development underpinned by our distinct approach to banking.”

Niall Booker, chief executive of the Co-operative Bank, added: “The Co-operative Bank has been a proud supporter of Unity Trust over many years and we will work closely with them through this process, which fits with our plan to simplify the bank.”

Discussions are at an early stage and any decision on a changed ownership structure would be subject to regulatory approval.

A statement said individual trade unions and trade union federations which own 73.2% of the shares in Unity Trust have certain pre-emption rights in respect of the shares held by the Co-operative Bank.

The Co-op’s banking business is now under the control of bondholders, including US hedge funds, as part of a refinancing to fill a £1.5bn hole in its balance sheet.

Journalists

David Whetstone
Culture Editor
Graeme Whitfield
Business Editor
Mark Douglas
Newcastle United Editor
Stuart Rayner
Sports Writer