Thursday, May 19 2022

Co-operative Bank plans to merge with TSB, offers Spanish owner Sabadell more than £ 1 billion










The Co-operative Bank has decided to merge with TSB. The cooperative has reportedly offered TSB’s Spanish owner Sabadell more than £ 1 billion.

But Sabadell fired back last night, saying the deal was “not a deal we want to explore at this time.” The approach, reported yesterday by Sky News, comes after Sabadell abandoned plans to sell TSB earlier this year, failing to find a buyer with an acceptable offer.

Deal: A source close to the process said a merger would give the cooperative and BST more scale at a time when banks’ profit margins are under pressure

A source close to the process said a merger would give the cooperative and BST more scale at a time when banks’ profit margins are under pressure from low interest rates and increasing competition.

The Co-op Bank had initially attempted to buy TSB’s branch network in 2013. But the deal fell through after it emerged that the Co-op had a black hole of capital of $ 1.5 billion. pound sterling.

The then president, former Methodist Minister Paul Flowers, was also embroiled in a drug scandal and was dubbed the “Crystal Methodist” after being denounced by the Department of Health. He was convicted of drug offenses in 2014.

The bank’s financial crisis led the cooperative group to sell 80 percent of its stake in the bank to hedge funds.

Earlier this year, US private equity giants Bain and JC Flowers took stakes in the lender, fueling rumors the Co-op Bank was merging with a rival.

Other smaller banks have recently discussed potential mergers or sales. Last week, Sainsbury’s announced that the sale of its banking arm had been suspended after failing to come up with a deal that would benefit shareholders.

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