The Co-operative has written off the value of its 20 percent stake in the Co-op bank.
The results for 2016 represented the group’s first pre-tax annual loss since 2013 when the bank almost collapsed but was saved US investors who allowed to keep a 20 percent stake.
However, the new US owners are also struggling to keep the bank’s head above water. Last year, the bank saw it’s fifth consecutive year of losses, losing £477 million.
The Co-operative Bank was put up for sale in February amid concerns over its balance sheet strength.
Steve Murrells, group chief executive of the Co-op, said: “We’ve made great progress in rebuilding our Co-op, with all our businesses delivering strong performances. While much remains to be done, our Rebuild plans have really started to deliver value for our customers, our members and their communities. That is exactly what the Co-op should be doing. Against this backdrop, 2017 sees us turning our attention to the next phase of our development. Our ambition will remain the same – championing a better way of doing business in communities up and down the country. We will continue to take our existing businesses forward and ensure they are ready for the digital age, but we will also look wider than our current markets.
“That is exactly what the Co-op should be doing. Against this backdrop, 2017 sees us turning our attention to the next phase of our development. Our ambition will remain the same – championing a better way of doing business in communities up and down the country. We will continue to take our existing businesses forward and ensure they are ready for the digital age, but we will also look wider than our current markets.
“We will continue to take our existing businesses forward and ensure they are ready for the digital age, but we will also look wider than our current markets.”
Speaking on the group’s bonds, he added: “In common with other bonds, our bonds increased in value because of falling interest rate yields available elsewhere.
“In addition our improving credit outlook also served to increase our bond values. As the value of our bond debt liability increases in the accounts, it creates a charge to the income statement.”
The Co-operative group reported a three percent jump in group revenues to £9.5 billion, with Co-op Food, Insurance and Funeralcare “all delivering strong levels of growth.”
Increased revenues included a 3.5 percent rise in food sales and a competitive performance in the funerals business. Insurance sales increased by 28 percent to £439 million. Overall, the operating profits grew by an impressive 32 percent.