These are:
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It has entered into exclusive talks with Royal London to sell its life insurance subsidiary, including the £15bn of assets in its Long Term Business Fund (LTBF) and The Co-operative Asset Management (TCAM) which manages the fund. A further update will be given when these negotiations have completed.
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CFS is also proposing to enhance and extend its historical partnership with AXA for the provision of in-branch financial advice that exists across the 248 branches of Britannia to its 90 Co-operative Bank branches.
Whilst some competitors have stepped away from providing their customers with access to financial advice, this move ensures CFS customers will continue to have access to a broad range of competitive life and savings products.
It also proposes to withdraw its field-based advisory team, with the regrettable loss of 670 roles, and transfer a further 82 existing Co-operative branch-based roles to AXA.
The strategic review began during the economic downturn and needed to consider the advent of the Retail Distribution Review which proposes significant reforms for the distribution of retail investments. It continued following the merger of Britannia and the Co-operative Bank and considered the subsequent investment of more than £700m being made to increase market presence and capability within the retail and corporate banking markets.
CFS' successful general insurance business was outside the scope of the strategic review and remains an integral part of CFS' financial services offering.
AXA and CFS have also agreed that products provided under the agreement will attract Co-operative membership points, thus ensuring that all CFS and Britannia customers continue to share in the success of CFS' business.
Neville Richardson, Chief Executive at Co-operative Financial Services, said:
"We have taken the time needed to consider all our options and find a solution which is ultimately in the best long term interests of our customers and members.
"We understand that such news may be difficult for impacted colleagues and we have not reached this outcome lightly. However, we were faced with rising regulatory costs in a business which was increasingly becoming sub-scale. This move supports our strategy to focus our specific attention on our banking and general insurance areas, where we have a growing and strongly differentiated competitive position.
"With regards to our negotiations with Royal London, our exclusive talks remain ongoing but I genuinely believe that a mutual solution for our life fund would be in the best interests of policyholders and colleagues alike."
Consultation with Trades Unions on the proposed withdrawal from direct retail product manufacture and distribution started as part of the business review, and CFS and its parent company the Co-operative Group will seek to minimise job losses where possible. Ongoing support, which includes redeployment options within CFS and The Co-operative Group, will be provided where appropriate to colleagues impacted by this change.
Any transaction that might ultimately be agreed between Royal London and CFS would be dependent on regulatory approval.
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