Euan Sutherland, the chief executive of the Co-op Group has urged for support of the bank plan to revive the organisation, saying that it represents the best interest of the stakeholders.

Mr Sutherland said, "We are sorry but we are a new team grasping the nettle and getting on with fixing the problems. We are standing firmly behind the bank. Having looked at all the options, the plan we have come up with is the one which is in the best interests of the greatest number of stakeholders."

Under the plan, bondholders will provide £500 million of capital for revival of the bank. The group reported loss of £709 million, mainly due to a loss of £559 million in the banking arm that is facing £496 million bad debt charge. It is believed that hundreds of pensioners and other small investors in the Co-operative Bank in the UK are likely to lose losing millions of pounds under the new rescue plan for the financial institution. The bank needs £1 billion to fill the gap in its finances and the management is also considering cutting or cancelling income paid to the bond holders of the bank.

New chief executive Euan Sutherland has taken charge at a time when the bank has multi-billion pounds in risky home loans and commercial property loan write-offs. The bank's whole mortgage book, which is about 6 per cent of its lending, is classified as impaired.