The Telegraph reports hedge funds with holdings in bonds issued by Co-op Bank have told the mutual it is in “cloud cuckoo land” after it refused to hold talks with investors after the release of its half-year results.
The results revealed a loss of £559m at the lender.
The report said one fund told senior Co-op Bank officials their response was not appropriate for an institution in such a parlous state.
“They are being incredibly naive. The results raise legitimate questions for bondholders when assessing the value of their investment and not to be able to discuss them concerns us,” said one fund manager with holdings of the bonds, who did not want to be named.
Bondholders have been told they face taking haircuts on their investments to help raise £500m needed to stop the bank going out of business by year end.
However, the Telegraph said despite disclosing a further £496m write down on the value of its loan portfolios last week the bank has insisted investors will have to wait until the end of October to see the details of the so-called “exchange offer”.
