The bank willingly turned its back on the millions made on foreign exchanges this week in a clear attempt to maintain the moral high ground in the City of London.
It resisted the temptation on Wednesday to 'do a billion' with the expectation of a quick pounds 50m profit as the Bank of England vainly tried to hold sterling's value. The bank's six foreign exchange dealers were told to balance their books and then sit tight.
Terry Thomas, managing director, said the decision to opt out was taken at an early stage. 'We felt it was wrong for a British retail bank to use our customers' deposits to speculate against our own economy. The enormous profits that you have seen bank dealers celebrating were almost certainly made at the expense of the tax-payer as represented by the Bank of England,' he said.
Mr Thomas admitted that there was a fine line between 'hedging' and 'speculation'.
'We were not in the business of searching around for every extra pounds 100m we could get our hands on to put against the Bank of England's virtual guarantee of making money,' he said.
The move not to speculate was part of the Co-op's ethical policy developed in the era of customers' charters and demands for access to information about corporate activities.
Co-op account holders will not see their money used to support a variety of undesirable ventures from the manufacture of torture equipment to money laundering for drug trafficking or tax evasion.
The bank said it was committed to tell customers what policy decisions were being made. Its Customer Charter already has strict rules about response to credit status inquiries and firm guidelines on confidentiality. Mr Thomas said the ethical policy meant the bank would seek out commercial enterprises with a similar stance and would encourage customers to take a positive stand on the environmental impact of their own activities.
'Customers of British banks should ask themselves and their banks 'Did I speculate against the pound last week?',' Mr Thomas said.