A KEY player in the deal to take ownership of the Co-op Bank away from the Co-op Group has sold its holdings in the lender, it emerged yesterday, after the value of its debt holdings increased.
Aurelius Capital has sold its bonds in the bank, meaning it will not be involved in the debt for equity swap which will see the Co-op Group’s stake fall from 100 per cent to 30 per cent. A source close to the hedge fund said it specialises in negotiations and so took the chance to sell out once the deal was in place and the bonds rose in value.
It came as the bank admitted it has been losing current account holders since the Reverend Paul Flowers scandal erupted.
“Recent events may have caused some brand and reputational damage,” the bank said in a statement. “These recent events may be a contributing factor to an increase the bank has seen in the switching out of current accounts.”
The bank declined to say how many it has lost, but stressed that current accounts make up only a small proportion of its overall depositor base.