Niall Booker named as new Co-operative bank chief
Monday 27 May 2013
Senior HSBC banker Niall Booker is to become chief executive of the troubled Co-operative Bank and deputy chief executive of the Co-operative Group, it was announced today.
Mr Booker has held a variety of senior roles at HSBC in a career of more than 30 years, spanning retail and corporate banking.
Most recently, he was group managing director and chief executive officer of HSBC North America.
He will take up his new roles on June 10.
It was announced on Friday that the Co-operative Bank is to stop lending to new corporate customers as it seeks to repair a major hole in its finances.
The move comes after credit ratings agency Moody's downgraded the Co-op to junk status, forcing it to issue a statement that it did not need to be rescued by the taxpayer.
It is seeking to rebuild its capital strength amid reports that it is facing a £1 billion shortfall, with regulators forcing banks to hold more cash as a buffer against future crises.
The bank has begun trying to shore up its finances by disposing of assets such as its life and general insurance businesses. It also pulled out of a deal to buy more than 600 Lloyds banking branches.
On Friday it emerged that it had gone a step further by indefinitely stopping its lending to new corporate customers. Loans for existing business clients would be considered on a "case-by-case basis".
It was not made clear whether this meant they would face tighter lending criteria than in the past. The move does not affect retail customers.
The Co-op has 100,000 small and medium enterprise (SME) customers. Loans to these customers totalled £1.3 billion last year, representing 1-2% of the market share.
The move was a setback for policymakers in the Treasury and the Bank of England, especially after the flagship Funding for Lending scheme designed to ease credit conditions was beefed up recently to encourage SMEs to access finance more easily.
But while the scheme incentivises banks by giving them access to cheaper funds to lend on in the marketplace, they must still be able to assure regulators that they have enough capital to be able to make the loans.
It means that those with not enough funds, such as the Co-op, are unable to take advantage fully and help lending grow.
The bank has been dragged down by its 2009 rescue of Britannia, then Britain's second-biggest building society. It inherited toxic commercial property and home loans that dragged it to losses of £662 million in 2012.
It is reported to be in talks with City watchdog the Prudential Regulation Authority about splitting itself into a good bank and bad bank, with toxic assets hived off from the healthy business.
The wider Co-operative group has interests ranging from food to funerals. Founded in 1863, it has more than six million members and employs more than 100,000 people.
- 1 BBC told new political editor must be 'impartial' with Nick Robinson reportedly stepping down
- 2 Number of young homeless people in Britain is 'more than three times the official figures'
- 3 Humans of New York image of crying gay teen receives best response yet from Ellen DeGeneres
- 4 The map showing the most dangerous tourist destinations in Europe, according to the Foreign Office
- 5 Swedish minister gives strongest case yet on why EU should stop turning away asylum seekers
BBC told new political editor must be 'impartial' with Nick Robinson reportedly stepping down
Isis propaganda video shows 25 Syrian soldiers executed by teenage militants in Palmyra
Number of young homeless people in Britain is 'more than three times the official figures'
Humans of New York image of crying gay teen receives best response yet from Ellen DeGeneres
The map showing the most dangerous tourist destinations in Europe, according to the Foreign Office
More Britons believe that multiculturalism makes the country worse - not better, says poll
Nathan Collier: Montana man inspired by same-sex marriage ruling requests right to wed two wives
Greece crisis: IMF was pushed around by Angela Merkel and Nicholas Sarkozy – and now it is being humiliated
Forget little green men – aliens will look like humans, says Cambridge University evolution expert
Girl, 7, stares down hate preacher at Ohio festival with pro-LGBT rainbow flag gesture
Osborne to cap family benefits at £23,000 – announced ahead of his post-election Budget
iJobs Money & Business
£15000 - £17000 per annum: Recruitment Genius: This company offers a range of ...
£15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...
£20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....
£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...