Co-op calls off a key vote before stress test result

Tim Wallace
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Niall Booker
The Co-operative Bank cancelled a key meeting with investors, postponing a vote on its directors’ bonus packages.

The troubled lender is widely ex­pected to fail the Bank of England’s stress tests, the results of which are published on 16 December.

It has a plan in place to improve its capital position, but this could be adjusted by regulators depending on the bank’s performance in the tests.

In a notice to markets, the bank said it could sell off more of its bad assets, “which are particularly susceptible to stress, at levels which can now be accommodated in our capital position, thereby significantly im­proving our resilience to a severe economic downturn.

“As a result, the board does not believe it is appropriate at this time for the bank to ask shareholders to vote at the general meeting on 10 December 2014 on an LTIP [long-term incentive package] scheme which includes measures, which may no longer be appropriate.”

Instead of giving investors a vote on the package next week, the bank’s remuneration committee is going to decide if and how it will change the package of rewards.

Any decision will be put to investors at the Co-op Bank’s annual general meeting next year instead.

Earlier this week, the bank’s boss Niall Booker admitted it would “come as no surprise” if the bank failed the stress tests.

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