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| Co-op chairman Len Wardle to step down in May | Co-op chairman Len Wardle to step down in May |
| (about 4 hours later) | |
| The chairman of the Co-operative Group, Len Wardle, is to step down in May. | The chairman of the Co-operative Group, Len Wardle, is to step down in May. |
| Mr Wardle said he had informed the board in August of his decision. | Mr Wardle said he had informed the board in August of his decision. |
| "The Co-operative Group is at its best when it is reforming and I want this change to continue," he said in a statement. | "The Co-operative Group is at its best when it is reforming and I want this change to continue," he said in a statement. |
| On Monday, the mutual group said it would lose overall control of the Co-op Bank following a restructuring of a rescue deal, which will provide the bank with extra capital. | On Monday, the mutual group said it would lose overall control of the Co-op Bank following a restructuring of a rescue deal, which will provide the bank with extra capital. |
| The change means the group will end up holding just a 30% stake in the bank. Under its original plan it would have held a 70% stake. | The change means the group will end up holding just a 30% stake in the bank. Under its original plan it would have held a 70% stake. |
| Mr Wardle's move comes just hours after the former chief executive of the Co-op Group, Peter Marks, appeared at the Treasury Committee of MPs to explain its decision to try to purchase 632 Lloyds bank branches. | Mr Wardle's move comes just hours after the former chief executive of the Co-op Group, Peter Marks, appeared at the Treasury Committee of MPs to explain its decision to try to purchase 632 Lloyds bank branches. |
| Banking woes | |
| Co-op Bank pulled out of the deal in April, which is when its financial problems came to light. | Co-op Bank pulled out of the deal in April, which is when its financial problems came to light. |
| Speaking about the hearing, the chairman of the Treasury Committee, Andrew Tyrie, criticised the former management for its conduct, saying: "Being owned by a mutual, the Co-op Bank differed from most of its competitors. But on today's evidence, its shortcomings did not." | |
| "A lack of personal accountability at senior levels, ineffective corporate governance and insufficient experience and expertise among those taking the decisions. This has become a familiar story." | |
| In June, the Co-op Group announced a plan to plug a £1.5bn capital hole in Co-op Bank's balance sheet. | In June, the Co-op Group announced a plan to plug a £1.5bn capital hole in Co-op Bank's balance sheet. |
| The group intended to put in £1bn of capital itself, with £500m coming from bondholders and owners of preference shares. | The group intended to put in £1bn of capital itself, with £500m coming from bondholders and owners of preference shares. |
| The bank would then have been floated, with Co-op Group holding a 70% share. However, the bank's creditors, led by US hedge funds, rejected the plan. | The bank would then have been floated, with Co-op Group holding a 70% share. However, the bank's creditors, led by US hedge funds, rejected the plan. |
| Mr Marks said the mutual group's loss of overall control of the Co-op Bank was "a tragedy". | Mr Marks said the mutual group's loss of overall control of the Co-op Bank was "a tragedy". |
| 'Immensely proud' | |
| However, he added that the plan to buy the bank branches from Lloyds had offered a "great opportunity". | However, he added that the plan to buy the bank branches from Lloyds had offered a "great opportunity". |
| "The bank was sub-scale, it needed to build scale to compete and survive. Verde [the Lloyds branches] created a great opportunity to do that and bring in significant capital and a high quality chief executive," he said. | "The bank was sub-scale, it needed to build scale to compete and survive. Verde [the Lloyds branches] created a great opportunity to do that and bring in significant capital and a high quality chief executive," he said. |
| Speaking about his departure, Mr Wardle, who chaired the group for six years, said he was "immensely proud" of his time there. | |
| "During the last year, we have appointed Euan Sutherland as group chief executive officer and started the changes that I believe will make The Co-operative Group stronger than ever," he added. | |
| Mr Sutherland said Mr Wardle's guidance meant the group had "made significant progress on beginning the reform which we will announce as planned in May 2014". |