Co-operative Bank retail savings balances increase 40%

The Co-operative Bank has revealed that its retail savings balances grew by 40 per cent over 12 months as consumers look for trustworthy places to put their money.

Figures for 12 months to October 31 show that the amount held by the Bank in deposits made by personal customers increased from £2.7bn to £3.8bn, helping it to maintain a position of strength and defy the turmoil which has embraced much of the financial sector.

Unlike many competitors, the Bank has maintained a strong capital base and has not needed to raise extra money from the wholesale markets to deal with recent conditions. Its business is fully funded by customer deposits, meaning it only lends out money taken in by savers.

Dick Parkhouse, Managing Director, Retail, said: "The Bank provides a range of competitive savings accounts but this huge growth is not simply down to offering good rates. It confirms that trust has become a major influence to consumers when it comes to looking for a safe place for their savings.

"The strength of our balance sheet and the responsible approach we've historically taken in managing our customers' finances is helping to build consumer confidence in our brand during these uncertain times."

The Bank believes this trend is set to continue, as 230,000 savers with the failed Icelandic bank, Icesave, are set to look for somewhere safe to put their money, which is being returned under the Financial Services Compensation Scheme.

The latest interim results from the Bank's parent company The Co-operative Financial Services - published 11 September 2008 - showed a growth in profits from £38m to £73.4 during the first half of the year despite the recent financial situation, with strong increases in both its savings and mortgage business.