MEMBERS of the Manx Co-op erative Society were given an advance preview of a huge shake-up in banking.
It came from the guest speaker at their recent annual general meeting at the Sefton Hotel, Douglas.
Paul Flowers, deputy chairman of the Co-operative Group and chairman of the Co-operative Banking Group gave an exclusive insight into moves towards a deal with Lloyds Bank.
At the meeting Mr Flowers revealed the bank was in talks with the Lloyds Banking Group regarding the acquisition of 632 of the latter’s branches but only if a deal could be ‘wholeheartedly recommended’ to its members.
Mr Flowers said that in 2012, the International Year of Co-operatives, the once-decried Co-operative trading model was ‘one for our times and one that needs to be rediscovered.’
Established almost 150 years ago the Group now had a £13 billion turnover and a workforce of 125,000, in addition to which its ‘conservative’ banking operation had allowed it to retain ‘high liquidity levels.’
Looking to the future he said the group must look to raising capital for growth but only in a manner ‘underpinned by our values and principles’, given that the Co-operative was the only British bank with an ethical policy that was ‘renewed and refreshed’ every three years.
His words have since rung true because last week it was announced in the national and international media that the Co-operative Bank has clinched a deal to take control of 632 Lloyds Banking Group branches in a move that will triple its branch network and bring back the centuries-old TSB brand.
Some 4.8 million Lloyds customers will transfer to the Co-op along with up to 7,000 staff who currently work in the branches that are to be sold.
The deal is expected to give the Co-op some muscle in high-street banking. It will create a 974-strong branch network with a 7 per cent share of current accounts – propelling it to become a major competitor to the big four high-street lenders, Lloyds, Barclays, HSBC and Royal Bank of Scotland. The Co-op currently has just 2 per cent of accounts.
The branches changing hands, however, will not operate under the Co-op banner, but will be rebranded as TSB – the name of the Trustee Saving Bank, the one-time mutual taken over by Lloyds in the 1990s.
Meanwhile, a positive turnaround in trading performance, rising membership and a heightened focus on delivering outstanding customer service were key factors contributing to the continued success of the Manx Co-operative Society as outlined by the society’s chairman Eric Calderwood.
Speaking at the annual general meeting Mr Calderwood said that for the past three years in succession the Co-operative Society had been generating profits, brought about by store refits providing customers ‘an enhanced shopping experience, the Group’s acquisition programme, improved cost controls and the hard work of its staff.
Mr Calderwood added that the board would be ‘engaging more directly with its members’; to this end the Society had a presence this year at St John’s on Tynwald Day and at Port St Mary for the Queenie festival.
Regional operations manager Gary Macaulay expanded on the Group’s trading performance success. £2.03 million profit in 2011 was, he said, ‘a huge step change’.
A focus on creating a positive in-store first impression, freshness, availability and value, combined with investment in IT systems and a team managers’ development programme had all been contributing factors to profit growth.
He added that despite ferry cancellations caused by bad weather in December 2011 the Manx Co-operative Society enjoyed its ‘best ever’ Christmas trading with £1.2 million of sales generated over the two weeks, while improved trading during this year’s TT fortnight had resulted from working together with the local events team to manage product availability which had led to £157,000 in additional sales and ‘a smoother’ post-TT recovery.
Membership growth in the Isle of Man was a continuing ‘success story’ said Mr Macaulay.
Additionally the Manx community had benefited from Britannia International’s incorporation into the Group, one benefit of this was Britannia together with food colleagues managed to raise £20,000 for Manx Mencap, while for 2012 fundraising efforts would be concentrated on Noble Hospital’s Special Care Baby Unit.
Mr Macaulay went on to say that promoting the Co-operative brand in 2012 would see a TV campaign focusing on value through a schedule of some 200 advertisements and he concluded by saying the driver for future success would be ‘putting the customer at the heart of everything we do.’
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Weather for Isle of Man
Friday 24 May 2013
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Temperature: 7 C to 13 C
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