Co-op pulls out of high street expansion, but launches family law service

The Co-operative Group has pulled out of a £750 million deal to buy 632 high street branches from the Lloyds Banking Group.

The Telegraph reports that the Co-op pursued the deal in order to acquire enough branches to launch a new high street bank, but the branches would have also housed its legal services arm, The Co-operative Legal Services (CLS). The deal’s cancellation will be welcomed by many high-street law firms which would have otherwise faced stiff competition from CLS.

Peter Noyce, partner at Menzies LLP, said: "Today's announcement puts the threat to traditional legal practices into abeyance, but it has not gone away. Given the wider pressures facing the sector, such as the outcome-focused regulation and well-capitalised market entrants attacking firms' core client base, law firms will appreciate a degree of respite. However, this is temporary and regardless of what the Co-op decides to do in the longer term, the sector can expect a tough time from competitors skilled in using sophisticated retail practices to win public trust whilst generating substantial profits."

Meanwhile, CLS has made a major advance into family law with the launch of a telephone advice service for people who are eligible to receive legal aid, as well as a face-to-face service across 78 branches nationwide. Legal Futures reports that the 78-branch network consists of Co-operative Bank branches, Co-op-owned offices and National Family Mediation centres.

Christina Blacklaws, director of family law at CLS, said: "As a business, we are committed to providing access to justice and equality for all before the law. We will continue to deliver legal aid family law services for the long term as part of our business-wide values to promote our social and community responsibilities."