• Register
Return to: Home > News > Regulation > FRC making inquiries at Co-op bank

FRC making inquiries at Co-op bank

The UK Financial Regulatory Council (FRC) has confirmed it is making enquiries about the Co-Operative Bank's (Co-op) 2012 accounts, though it is yet to begin a formal investigation.

The FRC said it ordinarily only comments on investigations when they are formally announced, however the watchdog confirmed it is "making enquiries into the Co-op's financial reporting in accordance with our normal procedures and under the terms of the Accountancy Scheme".

"These enquiries relate to the disclosure in the 2012 annual report and accounts of the bank's regulatory capital position. They also relate to the bank's loan impairment, impairment of its investment in its replacement banking IT platform, and to fair value disclosures."

Co-op Bank has been suffering losses largely caused by its 2009 takeover of Britannia Building Society. In the first six months of 2013, the bank lost £781m after tax.

As well as these substantial loses, the bank has faced a torrid 2013, with former chairman, Paul Flowers getting caught up in a series of compromising scandals.

KPMG, the bank's auditor, had reported in August that it had "significant doubts" over its ability to remain a going concern unless it was able to agree a £1.5bn rescue plan with its bondholder. The plan involved the Co-op Group contributing $1bn and the bank's bondholders contributing £500m.

If the deal is voted through, hedge fund collective LT2 will take control of the bank, with current owner Co-op group retaining a 30% stake.

KPMG said that its audit's of Co-op were robust and followed professional standards.

Top Content

    Blockchain and the Big Four: does it deserve all the hype?

    Although still in its infancy, blockchain is one of the most talked-about technologies of 2018. Will the blockchain bubble burst, or will it live up to its reputation as the ‘new internet’? Eleanor Jerome investigates

    read more

    Malaysia: Ready to show its strength

    Recent changes have enhanced the quality of audit reports in Malaysia, giving the profession a welcome opportunity to demonstrate its value to clients. Paul Golden reports

    read more

    China: Regulating the Chinese dragon

    Harsh regulatory actions and looming US trade wars have been dampening expectations in a Chinese market still full of potential, finds Jonathan Minter

    read more

    Indigenous Australians: New checks and balances

    With fewer than 40 known qualified Indigenous Australian accountants, Jonathan Minter speaks to Shelley Cable from PwC Australia about how increasing this number is an important part of improving the financial literacy of Indigenous communities

    read more
Privacy Policy

We have updated our privacy policy. In the latest update it explains what cookies are and how we use them on our site. To learn more about cookies and their benefits, please view our privacy policy. Please be aware that parts of this site will not function correctly if you disable cookies. By continuing to use this site, you consent to our use of cookies in accordance with our privacy policy unless you have disabled them.