Coventry BS bids for the Co-op Bank

WillPS

jackjones01 said:

How will it work with one being a bank and the other being a building Society. Will they still operate separately or will the co op get rebranded Coventry Building Society 🤷🏽

It's an interesting point. I suspect that Co-op Bank will cease any activity deemed incompatible with being part of a building society, although I can't think what that would be - it's unusual for a building society to offer credit cards and current accounts but of course Nationwide does both.

There is no proposal to demutualise Coventry Building Society that I'm aware of. Whether the two entities are merged, or kept separate, or rebranded under something else entirely will be interesting to follow.

wmb194

WillPS said:

jackjones01 said:

How will it work with one being a bank and the other being a building Society. Will they still operate separately or will the co op get rebranded Coventry Building Society 🤷🏽

It's an interesting point. I suspect that Co-op Bank will cease any activity deemed incompatible with being part of a building society, although I can't think what that would be - it's unusual for a building society to offer credit cards and current accounts but of course Nationwide does both.

There is no proposal to demutualise Coventry Building Society that I'm aware of. Whether the two entities are merged, or kept separate, or rebranded under something else entirely will be interesting to follow.

Have a look at the Building Societies Act: it places all sorts of restrictions on how they operate and how they must fund themselves, essentially mostly home mortgages and funded by, IIRC, at least 50% retail deposits.

It could just end up being a bank that's owned by a building society.

adindas

I have account with Coventry and Coop. But with this take over, there might not be anymore £1 monthly cashback from Coop.

Section62

adindas said:

I have account with Coventry and Coop. But with this take over, there might not be anymore £1 monthly cashback from Coop.

Alternatively, under Coventry's ownership CoOp bank may once again start offering products worth having, instead of being run into the ground.

WillPS

wmb194 said:

WillPS said:

jackjones01 said:

How will it work with one being a bank and the other being a building Society. Will they still operate separately or will the co op get rebranded Coventry Building Society 🤷🏽

It's an interesting point. I suspect that Co-op Bank will cease any activity deemed incompatible with being part of a building society, although I can't think what that would be - it's unusual for a building society to offer credit cards and current accounts but of course Nationwide does both.

There is no proposal to demutualise Coventry Building Society that I'm aware of. Whether the two entities are merged, or kept separate, or rebranded under something else entirely will be interesting to follow.

Have a look at the Building Societies Act: it places all sorts of restrictions on how they operate and how they must fund themselves, essentially mostly home mortgages and funded by, IIRC, at least 50% retail deposits.

It could just end up being a bank that's owned by a building society.

Feels like rather a large loophole if that's possible. What would stop any other building society from setting up a subsidiary bank?

wmb194

WillPS said:

wmb194 said:

WillPS said:

jackjones01 said:

How will it work with one being a bank and the other being a building Society. Will they still operate separately or will the co op get rebranded Coventry Building Society 🤷🏽

It's an interesting point. I suspect that Co-op Bank will cease any activity deemed incompatible with being part of a building society, although I can't think what that would be - it's unusual for a building society to offer credit cards and current accounts but of course Nationwide does both.

There is no proposal to demutualise Coventry Building Society that I'm aware of. Whether the two entities are merged, or kept separate, or rebranded under something else entirely will be interesting to follow.

Have a look at the Building Societies Act: it places all sorts of restrictions on how they operate and how they must fund themselves, essentially mostly home mortgages and funded by, IIRC, at least 50% retail deposits.

It could just end up being a bank that's owned by a building society.

Feels like rather a large loophole if that's possible. What would stop any other building society from setting up a subsidiary bank?

You'd have a harder time extracting merger cost savings but if they're separately capitalised entities I doubt it would a problem. The Co-op Group used to own a bank, Tesco owns a bank... Building societies have been known to have subsidiary companies e.g., Newcastle BS has its outsourcing business.

JamesPeter

Whatever the outcome, I think my Co-Op Members credit card, issued by Cooperative Bank will be on 'borrowed time'!

A pity really as I use my local Co-Op store a few times per week and even despite the Co-op members cashback being slowly reduced over time, it was a small source of extra 'Divi' or whatever they call it nowadays.

Zanderman

JamesPeter said:

Whatever the outcome, I think my Co-Op Members credit card, issued by Cooperative Bank will be on 'borrowed time'!

A pity really as I use my local Co-Op store a few times per week and even despite the Co-op members cashback being slowly reduced over time, it was a small source of extra 'Divi' or whatever they call it nowadays.

There's always the Coop store ordinary members card divi. Which, depending on which coop region you're in, can be good, for divi and offers.

And re the bank, which has been completely separate from Coop stores for a long time (so if your members credit card was at risk, it has been for some time, yet has survived so far!), no-one has any idea (anything in this thread is pure guesswork) what the merger would mean. Coventry might carry on with many of the Coop bank's traditional systems like your members credit card. 

WillPS

wmb194 said:

WillPS said:

wmb194 said:

WillPS said:

jackjones01 said:

How will it work with one being a bank and the other being a building Society. Will they still operate separately or will the co op get rebranded Coventry Building Society 🤷🏽

It's an interesting point. I suspect that Co-op Bank will cease any activity deemed incompatible with being part of a building society, although I can't think what that would be - it's unusual for a building society to offer credit cards and current accounts but of course Nationwide does both.

There is no proposal to demutualise Coventry Building Society that I'm aware of. Whether the two entities are merged, or kept separate, or rebranded under something else entirely will be interesting to follow.

Have a look at the Building Societies Act: it places all sorts of restrictions on how they operate and how they must fund themselves, essentially mostly home mortgages and funded by, IIRC, at least 50% retail deposits.

It could just end up being a bank that's owned by a building society.

Feels like rather a large loophole if that's possible. What would stop any other building society from setting up a subsidiary bank?

You'd have a harder time extracting merger cost savings but if they're separately capitalised entities I doubt it would a problem. The Co-op Group used to own a bank, Tesco owns a bank... Building societies have been known to have subsidiary companies e.g., Newcastle BS has its outsourcing business.

Businesses, even consumer co-operatives, are not bound by legislature as to how they lend in the same way that Building Societies specifically are tho. Newcastle Strategic Solutions is a SaaS platform, not a bank or even a lender.

boingy

It's a bit early to speculate. They haven't managed to buy them yet.