Britain's Co-op bank up for sale

(REUTERS) - Rescued from the brink of collapse nearly four years ago, Britain's Co-operative bank is looking for a buyer.
Bailed out by bondholders including a group of hedge funds.

They say the bank's made progress implementing its turnaround plan, cutting its cost base by a fifth since 2014.
But it needs to build up its capital.

Its core capital ratio is expected to drop below 10 per cent - falling short of regulatory requirements.

And the bank expects to make a significant loss for last year, with low interest rates partly to blame.

"Despite a number of reforms, they'd have to again look at their corporate governance. Any would-be buyer of this franchise would certainly want to have a free hand in its administration. And I'm not sure that will be possible under the current management regime. And it also comes at a point in time where the banking sector overall in the UK, although it's felt it has generally turned a corner, faces many challenges.", said Mike Ingram, market analyst with BGC Partners.

With four million customers, the Co-operative says it's considering ways to raise equity capital from existing and new capital providers.
It's immediate issue though is the repayment of 400 million pounds (S$706 million) worth of bonds that mature in September.

Co-op Bank nearly folded in 2013 with a 1.5 billion pound hole in its capital after losses from problem real estate loans.

Those who rescued it had been betting on rising interest rates and a cost-cutting turnaround plan to improve the bank's fortunes.