Slightly worrying news about

Here is what stood out for me. At the end of 2011, the Co-op Bank had £1.45bn of corporate loans on its "watchlist". In other words, it thought that £1.45bn of lending to companies – much of it property lending – could go bad….The point is that in the subsequent year, many of the companies with loans on the Co-op's watchlist did in fact default. Corporate loans in default at the Co-op jumped from £922m to just under £2bn….And that rise in defaults was a big contributor to the colossal £674m loss that the Co-op incurred in 2012….At the end of 2012, the Co-op had £3.7bn of commercial loans, home loans and personal loans that it classified as impaired or bad. Against that, it was holding a provision for potential losses on these loans of £643m….In other words the Co-op believes it will ultimately lose just 17% of these bad loans….At the same time, the Co-op has loss-absorbing equity capital of £1.6bn…Or to put it another way, impaired loans minus provisions for losses as a percentage of loss-absorbing capital is 194%.