Co-operative Banking Group appoints new CEO

Former HSBC senior executive Niall Booker is expected to reposition the group’s struggling banking operations.

New Statesman
Photograph: Getty Images.

The Co-operative Banking Group, a part of Britain’s The Co-operative Group, has appointed former HSBC senior executive Niall Booker as its new chief executive, in an effort to resuscitate its struggling operations.

Booker, who spent 30 years at HSBC and served as CEO of HSBC’s North American business in 2011, will also become deputy CEO of The Co-operative Group.

Euan Sutherland, CEO of The Co-operative Group, said: “The board and I are confident that Niall will add tremendous value, helping us work through the complex issues that we currently face as we work to reposition our bank.”

Booker, whose appointment as CEO will become effective on 10 June 2013, will succeed Barry Tootell, who resigned from his position earlier this month after rating agency Moody’s downgraded the banking group’s debt to ‘junk status’.

The credit ratings agency had also raised concerns over its property mortgage portfolio. The rating had come after the banking group failed to acquire more than 632 branches of Lloyds Banking Group.

In response to the downgrade, the group had earlier this month issued a statement that said: “We do acknowledge, like the rest of our banking sector peers, the need to strengthen our capital position in light of the broader economic downturn and the pending introduction of enhanced regulatory requirements, and we have a clear plan to drive this forward throughout the coming months.”

Currently, the banking group is holding negotiations with regulators about its capital position and to dispose its general insurance operation to cough up funds. Earlier this week, it stopped new business lending following concerns that it had to save capital.

It is one among the several banks in the country that have to raise a capital of £25bn between them so that the banking operations can stay afloat even during any crises in the future.

The Co-operative Group is the UK’s largest consumer co-operative that operates a group of businesses including The Co-operative Insurance Society (CIS) and The Co-operative Bank including smile and Britannia.