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There’s light at the end of the tunnel for bond investors in the Co-operative Bank…
The Co-op bank’s debt rallied Friday morning on the news that it has entered further discussions with multiple investors over a potential sale.
Co-op bonds have become a key gauge of the bank’s immediate future, with investors expecting to take significant losses if a buyer is not found.
Today, the £400m in senior bonds have risen 2 per cent to trade at 86 pence. Its junior debt has also risen sharply, to trade at 33 pence.
The bank’s senior bonds had fallen as low as 82 pence on the pound in late March, while its junior debt has previously crashed to the low 20s on the pound.
The Co-op, which has struggled since a capital hole on its balance sheet came to light in 2013, announced the launch of a sale process in mid-February this year.