Coventry BS bids for the Co-op Bank

jameseonline

Coventry members got an email this morning 

Zanderman

A more easily readable cut and paste of that email:

Coventry Building Society and The Co‑operative Bank

Dear (Zanderman)

We're writing to let you know that Coventry Building Society has reached an agreement of key terms with the owners of The Co‑operative Bank to buy the Bank subject to agreeing the contract and gaining approval from the financial services regulators.

Listening to members

We want to understand member views of such an important step, and we've been listening to hundreds of members across the country via surveys and focus groups.

The first question is often: if this goes ahead, will it change the products and services you're using now? It won't. Your savings and mortgage accounts will stay the same and you'll continue to have the friendly, expert Coventry service you value so much.

Ultimately, the Board has decided to pursue this deal to create a stronger Coventry Building Society to help sustain the value and service you expect from us for the benefit of current and future members.

Delivering for members

• A stronger mutual building society, that will carry on delivering competitive savings and mortgages, and keeping your money safe.
• More investment in delivering an outstanding service in our branches, and online, telephone and mobile services.
• A larger UK branch network providing choice, access, and reassurance to more people.
• A broader set of products and services, like current accounts, to meet more of your needs.
• The creation of a larger, values-driven organisation centred on meeting the needs of members and customers, and making a positive impact on wider society.

The Co‑operative Bank – the right fit

We've spent a lot of time evaluating this opportunity and believe it's the right thing to do. The Co-operative Bank is a financially stable, profitable organisation with a shared heritage and products and services that complement our own.

We may be three times bigger, but the Bank's customers, colleagues, branches, mortgages and savings balances, and the additional products and services it provides such as its business proposition, will make us stronger and able to keep offering the value and service that matters to you. We're confident that we have the people, capability, and the financial strength to achieve this.

What happens next

There is a lot still to do and no guarantee that the deal will happen. Our next step is to agree the contractual terms and gain regulatory approval.

It's really important to us that we keep you informed. We'll keep our website updated and you can find more information, including the formal regulatory announcement, there now.

This is an exciting moment for the Society. We have a very successful history, and we believe this could be the basis of a very successful future – with membership, great value and great service at its heart.

Stephen Hughes

Chief Executive

Coventry Building Society

steven141

The Smile brand is a decent brand that could be built upon. They could move all current accounts to Smile and keep all other products at Coventry Building Society. 

WillPS

steven141 said:

The Smile brand is a decent brand that could be built upon. They could move all current accounts to Smile and keep all other products at Coventry Building Society. 

It's a great consumer brand, I agree - I wonder if perhaps it's not the best brand to stick on a business banking offer tho? That said I thought the same of Monzo and it doesn't seem to have stopped them.

I presume that'll be the destiny of the banking acquisition when all is eventually said and done, along with investment and credit card offers maybe.

jackjones01

They’ve mentioned about moving current accounts and savings to CBS but they haven’t mentioned credit cards 🤷🏽

Stuart_W

jackjones01 said:

They’ve mentioned about moving current accounts and savings to CBS but they haven’t mentioned credit cards 🤷🏽

They've mentioned "a broader set of products and services, like current accounts" and they've mentioned "the additional products and services it provides such as its business proposition" which is just exemplifying what the Co-op offer that Coventy don't, but it's not claiming to be exclusive or exhaustive so I don't see this as necessarily excluding credit cards.   

Stuart_W

... and the credit card product I have been expecting to change or be withdrawn for over a decade is the Co-operative Members' Credit card, which I have.

It's still tied to the Co-op Group's member dividend payment, which actually hasn't been made since 2013, so every 6 months I receive a Co-op Group dividend payment showing zero dividend payment and then my credit card cashback. It's a bit nuts - and extremely slow. Spending accrued 1Jan to 30June is paid some time in November.

It used to be a clean 0.5% cashback on all spend but this was cut back to 0.3% in recent years. Still not too bad for a VISA card these days. Spend in Co-op Group stores is still 0.5% at the moment, but even though I do most of my shopping in my local Co-op, it's a Central Co-op (different society) so have never got the higher cashback rate (used to be 1%).

Now that Everyday Rewards is going, this might be next. Or at least lose the now bizarre link to the dividend payment and copy the smile credit card of a clean simple cashback rate rate paid the following month direct into the credit card account.

WillPS

The Members credit card is certainly an enigma. I wonder if continuing to offer it was part of the brand licensing arrangement struck when The Co-op Group lost control?

I guess we'll know soon. Speaking of which, it's interesting that The Co-operative Bank don't mention the takeover anywhere on their website yet.

Stuart_W

WillPS said:

 it's interesting that The Co-operative Bank don't mention the takeover anywhere on their website yet.

I suppose they are not going to until anything is definite, or at least only the regulatory approval is pending. 
Today's Q1 trading update to the LSE  by the bank references the proposal.

jameseonline

WillPS said:

The Members credit card is certainly an enigma. I wonder if continuing to offer it was part of the brand licensing arrangement struck when The Co-op Group lost control?

I guess we'll know soon. Speaking of which, it's interesting that The Co-operative Bank don't mention the takeover anywhere on their website yet.

Well it doesn't surprise me there's nothing on their site, when I applied for their current account (to be eligible for the regular saver) they still had references to a switch offer that already ended.

CO Operative Bank like to do things slowly we know this😉