- Coventry agreed to acquire the Co-op Bank last month in a £780m deal
- The acquisition would return the Co-op Bank to a mutual ownership structure
Coventry Building Society said it does not require members to vote to approve its takeover of the Co-operative Bank, which the pair fully confirmed on Friday.
The West Midlands group agreed to buy Co-op Bank last month in a £780m deal to create Britain’s seventh-largest lender, with millions of customers and around £89bn of assets.
It would also return the Co-op Bank to a mutual ownership structure about a decade after the Manchester-based company was rescued by US hedge funds when it ran into financial difficulties.
Takeover: Coventry Building Society agreed to buy the Co-operative Bank last month in a £780m deal to create Britain’s seventh largest lender.
Consent from the Prudential Regulation Authority and the Financial Conduct Authority is required to accept the acquisition.
However, following assessments and professional advice, Coventry bosses have “conclusively determined” that a members’ vote is not necessary.
“To make this decision, the CBS board of directors relied on member surveys and focus groups, which clearly outlined its priorities such as maintaining our value proposition and quality of service,” the company said.
Fellow building society Nationwide refused to allow its members a say over its planned £2.9bn takeover of Virgin Money despite significant public pressure.
It claimed that the huge size of its member base (17.9 million) made it impossible to hold a vote in a short period of time and that it was not legally necessary under the Building Societies Act 1986.
Virgin Money shareholders voted overwhelmingly earlier this week to approve the deal, which will close during the fourth quarter of 2024.
Subject to regulatory approval, Coventry plans to acquire the Co-op Bank in the first three months of next year.
It said the acquisition would give it exposure to the personal current account and commercial banking markets, and would bolster investment to improve service in branches, online, telephone and mobile services.
David Thorburn, chairman of Coventry Building Society, said the deal would be “a transformational moment for members and customers” of both companies.
He added: “We are building on our shared heritage and creating a stronger mutual business that will be in the best interests of our current and future members.”
Nick Slape, chief executive of the Co-op Bank, said the company has “successfully transformed and simplified the bank into one that is now sustainably profitable with a strong capital and liquidity position”.
“This transaction is a natural next step and presents an exciting opportunity.”
