Property News · July 20, 2012

Co-op Bank: it's time to go back to the mutuals


Demutualisation was a disaster. Only two of the former societies – Woolwich and A&L – have not required a taxpayer handoutDemutualisation. It didn’t work, really, did it? Take the Cheltenham & Gloucester. For 145 years it ran, rather successfully, as a mutual building society. Then over 17 years, roughly coinciding with the credit boom and bust, it was gobbled up by Lloyds for £1.8bn, which, after (rather unhappily) acquiring Halifax, merged it into a supersize mortgage lender. Now it’s returning to its mutual roots, albeit under the control of the Co-op Bank.Who benefited from the financial shenanigans? Let’s follow the money. First, the members of the society and the carpetbaggers who swept in ahead of the demutualisation picked up an average of £2,200 a head. But the bosses did rather better. The chief executive of C&G saw his salary increase from £333,720 to £400,000 to “reflect his involvement with Lloyds”. In addition, he was awarded a “senior management” deal said to be worth a further 40%. Continue reading…

Source : theguardian.com
Read more…Co-op Bank: it’s time to go back to the mutuals

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