Co-op customers face 20% rise in package account fees
Co-operative Bank customers with packaged current accounts are facing a 20% price hike in their monthly fees.
Customers using the bank's Privilege Premier Account will pay £15.50 a month for the account from 1 July, up from £13.50 they currently pay; while Privilege Account holders will see their fees rise from £9.50 to £11.
The package accounts include benefits such as travel and mobile phone insurance.
Some customers with Smile, the bank's internet branch, will also face a price hike of £2.50 a month, up to £15.50, too.
A spokesman told the Guardian the increases "reflect the increase in costs of providing the features of the account to customers" and that there would be no change in the benefits offered.
The move is the latest slice of bad news to hit the crisis-hit bank. Earlier this month, the Co-operative Group reported the worst set of financial results in its 150-year history, recording a £2.5 billion loss in the year to December 2013, with the banking arm accounting for £2.1 billion of the total.
And a major report into the bank's near-collapse is expected to be published this week, focusing on its takeover of the Britannia Building Society and poor governance as reasons why the group is in such turmoil.
Customers with Co-operative Energy are also facing a price hike, with the group announcing it will be putting up its electricity prices by around £28 from 27 May.
This is a mutual organisation owned by its members and not by shareholders. These societies offer a range of financial services but have historically concentrated on taking deposits from savers and lending the money to borrowers as mortgages, hence the name. In the mid-1990s many societies “demutualised” and became banks. One academic study (Heffernan, 2003) found demutualised societies’ pricing on deposits and mortgages was more favourable to shareholders than to customers, with the remaining mutual building societies offering consistently better rates. In 1900, there were 2,286 building societies in the UK; in 2011, there are just 51.