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Co-op Group announces £2.5bn losses for year | Co-op Group announces £2.5bn losses for year |
(35 minutes later) | |
The Co-operative Group has announced losses of £2.5bn for 2013, marking the worst results in the group's 150-year history. | |
The group said most of the losses stemmed from the Co-operative Bank, which amounted to £2.1bn. | |
That included a trading loss of £1.44bn for the year to December, when the group lost control of Co-op Bank to US hedge funds. | |
Chief executive Richard Pennycook said 2013 had been a "disastrous" year. | Chief executive Richard Pennycook said 2013 had been a "disastrous" year. |
He added: "These results should serve as a wake-up call to anyone who doubts just how serious the challenges we face are. | |
"The scale of this disaster will rightly shock our members, our customers and our colleagues," | |
In addition to the trading losses at the bank, the group took another charge of £625m when it handed over 70% of the bank's shares to bond investors. | In addition to the trading losses at the bank, the group took another charge of £625m when it handed over 70% of the bank's shares to bond investors. |
The company also wrote down the value of the Somerfield store chain by £226m. | The company also wrote down the value of the Somerfield store chain by £226m. |
The losses has been widely expected - in its half year results the Co-op Group had reported pre-tax losses of £709m. | |
At the same time it revealed £496m in impairments and the £1.9bn black hole in balance sheet of its banking arm, which had scuppered the planned takeover of 632 Lloyds banks branches and caused the near collapse of the Co-op Bank. | |
Last week, the Co-op Bank reported pre-tax losses of £1.3bn for 2013 and said it did not expect to make a profit in 2014 or 2015. |