Co-op Bank creditors approve bailout deal

The Co-op Bank has been hit by scandal

Co-op Bank's creditors have approved a £1.5bn plan to shore up the struggling bank's finances.

The troubled bank was forced to hand over control to private investors after discovering a serious capital shortfall in its balance sheet.

The plan will give bondholders 70% ownership of the bank while the Co-op Group, the bank's current owner, will see its stake fall to 30%.

The Co-op said 99.9% of creditors who voted had approved the plan.

The deal still needs to be approved by a court on Wednesday.

Labour's former City minister Lord Myners has been appointed as Co-op Group's senior independent director and will chair its governance review.

In addition to the bank's financial problems, it was hit by scandal when former chairman Paul Flowers was arrested for alleged drugs offences.

Last month, Prime Minister David Cameron announced that there would be an independent investigation into events at the bank, including Mr Flowers' time at the helm.