Co-op Bank wants to strike a deal within two weeks to shore up its balance sheet amid fears that investors will face huge losses if negotiations are further delayed.
The struggling lender’s intention is to complete the debt-for-equity swap. This means that depositors would swap bonds for a share of a loss – before £400million of senior bonds mature in September.
Media outlets report that a committee of bondholders, that owns the majority of the Co-op Bank’s shares, is close to unveiling the terms of a new deal to the struggling lender’s board and its regulators.
Earlier, sources said that the hedge funds, led by GoldenTree Asset Management and Silver Point, were targeting the outline of a deal to inject new funds into the Co-op Bank in little more than a fortnight.
The development will raise hopes that a consensual private sector solution can be found to safeguard the Co-op Bank’s future, despite the disappearance of prospective buyers such as Virgin Money.
Read more at Eagle Radio.