Co-op bank reports ‘resilient’ performance in first few months of 2021

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Despite seeing an increase in net interest income, thanks to higher interest rates, the bank saw costs increase significantly which dented its bottom line.
Despite seeing an increase in net interest income, thanks to higher interest rates, the bank saw costs increase significantly which dented its bottom line.

Co-op Bank reported a small underlying profit in the first three months of 2021 of £2.6m, with statutory profit before tax of £7.2m.

CEO Nick Slape said the bank had delivered a “resilient” three-month performance, that should position it well to deliver overall profit in 2021.

“We have delivered a resilient performance by maintaining our focus on income generation, simplification and by reducing our operating costs,” he said.

“Our retail business continues to grow, with net residential lending increasing by 6 per cent in the quarter with a strong pipeline. Our SME banking proposition is developing well with the launch of a new mobile app, credit card and same-day onboarding, alongside a strong pipeline of new customers switching to join us.”

The lender benefitted from the housing boom at the start of the year, with a six per cent increase in mortgage balances to £1bn with a strong pipeline going into Q2 of £2bn.

The bank launched a new SME mobile banking app in the first three months of 2021, as well as a new credit card product for its SME customers.

It also set up a ‘pay as you grow’ payment option, along with a calculator, to help SME customers with Covid bounce-back loan repayments.