Co-op Group Results: Project Verde in Doubt but Legal Services Does Well

This is not a legal post but does touch on an important issue for the whole UK co-op movement.

The massive concentration of the movement into the Co-operative Group has led to a renaissance in terms of retail market share and big improvements in the approach to ethical trading and promotion of the co-operative ownership model as different from PLC’s.

However, the latest results have been seriously affected by the need to account for the cost to the Co-op Bank of PPI misselling and bad debt. The bad debt was apparently inherited from Britannia, which became part of the bank only a few years ago and which has not yet been fully integrated.

Maybe this will spell the end of the project to buy all those Branches from Lloyds (Project Verde). The FT certainly seems to think so. Maybe a little time to consolidate would be healthy and useful for the Group and, particularly, the bank? With so many of UK consumer co-operation’s eggs in one basket, the security and safety of that basket becomes particularly important.  The insurance side of the business is being sold and travel has already gone via the Thomas Cook  joint venture. Will there be yet more concentration on retail? What about funerals and farming?

It will be interesting to see how the new CEO moves things forward. What really matters is to keep emphasising the co-op difference and the importance of members and of governance. That is the  co-op’s USP. It should be constantly used and promoted. A certain amount of movement in and out of businesses ensures that the service to members  is improved and developed.

The new Co-operative Legal Services business has broken even in its first year. That is impressive and maybe points the way forward…..

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