Former Co-operative Financial Services chief executive David Anderson has refused to take the blame for the bank’s troubles despite overseeing the merger with Britannia Building Society.
Anderson headed up the Co-op Bank between 2005 and 2009 and led the Britannia merger in 2009, which has been heavily criticised by MPs. The deal contributed to the Co-op Bank needing a £550m provision for bad commercial loans this year.
During the ongoing Treasury select committee inquiry into the Co-op Bank, a string of executives have denied responsibility for failings at the bank including former Co-operative Group chief executive Peter Marks and former Co-operative Bank chairman Reverend Paul Flowers.
The Government is overhauling the approved persons regime for deposit-taking institutions to introduce much greater individual responsibility into the sector.
Appearing before the TSC this week, Anderson cited the “distraction” of buying 632 Lloyds’ branches as well as IT costs and provisions for missold payment protection insurance as other factors behind Co-op’s problems.
He said: “Clearly the loan book was considerably worse than we thought it was going to be, and I wouldn’t represent it any other way, but I don’t believe it is sufficient to create the situation the bank now finds itself in.”
Banking consultant Mehrdad Yousefi says: “Anderson is partially to be blame but the regulator was even more asleep. The FSA believed the Co-op Bank was in good shape as late as September 2011 when it gave its blessing to the Lloyds’ branches deal.”