Former business secretary Sir Vince Cable has poured cold water on the Co-operative Bank’s plans to sell itself, in an interview with the BBC this morning.
Cable, a former Lib Dem MP, said selling the bank was “bad news” because it will reduce competition and lead to less choice for customers.
He added that he hopes the Co-op Bank is taken over by a newcomer to the market, with an ethical outlook.
Read more: Here’s who could buy the Co-operative Bank
Cable, who was awarded his knighthood for political and public service in 2015, noted that while there are a lot of banks in the UK compared with the likes of the US and Germany, British institutions have a history of poor service.
As such, he is a fan of challenger banks, he said – but he added challengers have not had a major impact on the market yet.
Part of the reason the new banks are struggling to win customers, according to Cable, is merely down to the fact that customers find it a “hassle” to switch banks.
However, analysts warned this week that the lender may find it tricky to find a buyer, given the problems it’s experienced in the recent past.
In 2013, the Co-op was forced to reveal a £1.5bn black hole in its finances. This was followed by a series of crises, including the public downfall of its chairman, Paul Flowers.