UK's Co-operative would scrap payment of half-year dividend
Britain's biggest customer-owned business -The Co-operative Group CWSGR. UL will scrap dividend payments to its 7.6 million members .The Co-operative, which paid out 64 million pounds in dividends last year, will offer its members discount vouchers in stores instead.
This decision has been taken to help pay for a 1.5 billion pound ($2.4 billion) salvage of its banking division. The co-operative also runs supermarkets, travel agencies and funeral services.
Co-op Bank hit trouble after ending up with big losses on commercial property. Many of the bad loans were acquired through its takeover of the Britannia Building Society in 2009 and the bank's management has subsequently been refurbished.
Members were informed about the decision by the Co-operative's Chairman Len Wardle at the group's general meeting in Manchester this weekend.
Wardle said, "Our decision not to pay a half-year interim dividend was not one that was taken lightly. But it was viewed by the board as necessary given the challenges facing the group at this time."
"We still want to make sure that we give some form of recognition for the loyalty that our members have shown so far this year."
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