The Co-operative Group posted a pre-tax loss of £132m for 2016 on Thursday, bruised by a £185m hit for writing down the value of its 20 per cent stake in the Co-operative Bank to nothing.

The results mean that the mutual has fallen into the red for the first time since 2013.

In a statement, it said that the markets in which it operates remained “fiercely competitive” and that it was still contesting with “challenging consumer and economic backdrop”.

It called its valuation of the Co-operative Bank “prudent” considering that it was in the middle of a sales process, the outcome of which was still uncertain.

Back in February, the Co-operative Bank was put up for sale after it said that that its capacity to organically meet longer-term UK bank regulatory capital requirements had become “constrained by the impact of interest rates that are lower than previously forecast ... and by higher than anticipated transformation and conduct remediation costs”.

In 2013, the bank narrowly avoided collapse after problematic real estate loans left a £1.5bn hole in its capital base.

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Bondholders effectively took control of the bank at the time, while the Co-operative Group became a minority shareholder.