Co-op set to pay dividend to 600,000

Thousands of borrowers with Co-operative Bank mortgages are set to be given cash dividends of up to a few hundred pounds by the mutual lender.

In total, about 600,000 Co-op members with financial products from the mutual will receive “divvy” payments in June, though most will be for about £10 or less.

The cash amounts vary according to the products held by a customer and their spending with the wider Co-op, including at its supermarkets.

The forthcoming distribution is for 2009, for which the annual dividend per Co-op membership point has been held at 2p overall, the same as for 2008. Borrowing members earned one point per £20 of mortgage balance.

However, members’ payments could be lower for 2010, following last year’s merger with Britannia Building Society.

Britannia customers will shortly receive their final pay-outs from the former society’s own reward scheme.

That programme was replaced by the Co-op dividend scheme from the start of 2010, with Britannia savers and borrowers due to receive their first “divvy” distribution later this year.