By Jonathan Davies
The Co-operative Bank has revealed it is facing fines from the City regulator over the scandal that nearly saw it collapse two years ago.
The Co-op Bank nearly collapsed when a £1.5 billion black hole was found in its finances. It is now just 20% owned by the Co-operative group after it was forced to sell shares to hedge funds and investors.
But the Bank has said it is entering talks with the Financial Conduct Authority (FCA) and the Bank of England's regulatory arm, the Prudential Regulation Authority (PRA), to discuss fines and settlements on the activities between 2008 and 2013 which nearly led to its demise.
The regulators have the power to fine the company and impose bans on working in the City for individuals.
“The outcome of any settlement discussions is currently uncertain both in the details of any findings and any potential financial penalty,” the bank said.
“FCA and PRA have recently indicated that their preliminary view is that they are minded to make findings against the bank covering certain decisions, events and processes over the period from mid-2008 to end-2013. Based on their current view, the FCA and PRA have indicated they intend to commence formal settlement discussions in July 2015."
New boss Niall Booker said: “The bank has been co-operating fully with the regulatory authorities. The risks of any adverse findings and penalties relating to these past events have been highlighted on multiple occasions previously. We will provide a further update as and when appropriate.”