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Co-op bank bonds slumped to their lowest ever levels today, after signs of increased pressure to find a buyer for the struggling lender.

The bank, which put itself up for sale in February, announced an annual loss of nearly £500m earlier this month, and has suffered from a series of scandals over recent years.

On Tuesday, Sky News reported potential buyers of the bank must lodge their bids within two weeks.

The bank’s £400m of senior bonds, which mature in September this year, fell by 4 per cent to trade at 84 pence in the pound.

Its subordinated bonds, which would be more exposed to losses in the event of a failure, dropped by more than 7 per cent to trade below 40 pence in the pound.

The bond prices are indicating higher expectations of a failure, or resolution, which could result if no buyer is found.

Copyright The Financial Times Limited 2018. All rights reserved.

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