Remember back in March, when the Co-operative Bank discovered yet another £400m, PPI-shaped hole in its balance sheet? Well, it's found a way to mitigate that: it's launched a £400m placing and open offer, essentially a form of rights issue, issuing 200 million new shares.
Who would touch Co-op shares with a barge pole these days? Apparently four of its major shareholders - including the Co-operative Group, its largest shareholder - have committed to buy just under a third of them. Nevertheless, the placing will reduce the Co-op's stake from 30% to just under 20%, which has prompted critics to ask whether it should be able to use the (not so) good name of the Co-operative in the first place.
Although the statement doesn't say who else is planning on buying up the shares, Sky suggested on Wednesday that Corsair Capital, owned by Lord Davies, and Apollo Management, one of the world's largest investors, were both planning on having a go.
The extra capital will 'enable us to reset our starting capital position for the execution of our business plan to return to our roots as a bank focused on our retail and SME customers with values and ethics at the heart of our business,' said chief exec Niall Booker. It's tempting to point out that the 'values and ethics' that created this in the first place involved mis-selling an expensive product to cash-strapped customers who didn't need it - but MT will refrain.
The bank also took the opportunity to mention that its chairman of less than a year, Richard Pym, is planning to step down by the end of 2014. 'The board will undertake a full and rigorous process' to find a replacement, it said. Well, quite...