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UK's Co-op Bank to shut 50 branches in rescue plan

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November 4, 2013 07:29 AM EST | AP


LONDON (AP) — Co-operative Group, the U.K.'s biggest mutual business, says it has agreed on a revised rescue plan to plug a 1.5 billion-pound ($2.4 billion) hole in its finances.

The ethical lender's plan will result in the loss of 50 of its 324 branches by the end of 2014.

Chief Executive Officer Euan Sutherland said Monday the group will retain 30 percent of the bank and remain its largest shareholder.

The company says its values will be "legally embedded" in the new rules that govern the bank. That's an important point because many of its customers — such as charities — chose it over other institutions because of its values.

The bank's difficulties resulted from poor commercial loans taken on in a merger with the Britannia building society in 2009.