Co-operative Bank is to stop providing banking services to its local authority clients, it has announced.
In a letter written to council leaders and chief executives, Co-operative Bank said it would be focussing its attention on individual and small to medium sized business customers.
‘This means that we will be seeking to exit some banking relationships which do not meet our future risk appetite or which have comprehensive and complex banking requirements,’ the letter said.
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Co-operative Bank is withdrawing services from local authorities to focus on small and medium sized businesses.‘As part of this strategy, we have decided to withdraw from our involvement in providing banking transmission services to local authorities.’
Existing contracts with councils will not be renewed when they expire, the bank outlined. Support with be given to local authorities wishing to bring forward their timescales for seeking formal banking tenders.
The Co-operative is thought to have a 35% market share of local authority transactional banking contracts.
Reacting to the decision, chief executive of campaigning body Move your Money, Laura Willoughby, labelled the move ‘short sighted’.
‘Local authorities need to be able to choose from a competitive market and find banks that share their values and aspirations. Instead, this announcement leaves their choices virtually non-existent.’
