(Reuters) — Britain’s Co-operative Bank (42RQ.L), rescued from the brink of collapse by a group of hedge funds in 2013, has put itself up for sale as it seeks to build up its capital to meet regulatory requirements.
The bank said on Monday that it had made considerable progress implementing its turnaround plan, cutting its cost base by a fifth since 2014.
But it still expects to make a “significant loss” for last year and said that building up capital has proved difficult given low interest rates.
“As a result, and having concluded its annual planning review, the board is today commencing a sale process, inviting offers for all of the issued ordinary share capital in the bank,” the bank said.
The Bank of England’s Prudential Regulation Authority, which regulates Co-operative Bank, said it welcomed the measures announced on Monday.
“We will continue to assess the bank’s progress in building greater financial resilience over the coming months,” the PRA said in a statement.
The Co-operative Bank, which has four million customers, said it was also considering ways to raise equity capital from existing and new capital providers, and a potential “liability management exercise” of its outstanding public debt.
Last month, the bank said it expected its core capital ratio to fall below 10 percent, falling short of regulatory requirements.
The bank’s immediate issue is the repayment of 400 million pounds worth of bonds that mature in September.
Co-op Bank nearly folded in 2013 with a 1.5 billion pound hole in its capital after losses from problem real estate loans.
The bank was rescued by bondholders, including hedge funds, mainly from the United States, who bet that rising interest rates and a cost-cutting turnaround plan would improve the bank’s fortunes and make them a return on their investment.