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Co-op said in a statement it will ask for feedback in order to know where it needs to improve after a £1.5bn capital hole was revealed on its balance sheet, and its former chairman, Reverend Paul Flowers, became embroiled in a hard drugs and sex orgies scandal.

"We will be asking people up and down the country what they believe The Co-operative should really stand for," said the group's chief executive Euan Sutherland. "The results will feed directly into our wider review of strategy and purpose."

The Co-op Bank is one of UK's smallest lenders with 6.5 million customers and a 1.5% share of the current account market. However it is a household name in Britain, as the wider group includes supermarkets, funeral services and pharmacies.

Trouble started in May 2013, after the Co-op Bank's head of banking Barry Tootell resigned after rating agency Moody's suggested that the British government may have to bailout the lender.

Moody's slashed the bank's debt rating to "junk" status, due to concerns that the lender had a black hole in its balance sheet.

On 22 November, police arrested Flowers, as part of an investigation into the supply of illegal drugs. He has since been bailed. In January 2013, the Co-op unveiled the first set of details surrounding its benchmark internal review.

Lord Myners, who will receive a token £1 salary for his work as chairman of the Co-op's internal governance review, will be scrutinising the ethical organisation's democratic systems and control structures within two phases.

During the first phase, the review will focus primarily on the development of recommendations for strengthening the board structure, composition, working processes and board policies, following the scandal surrounding its former chairman Paul Flowers, that has allegedly been embroiled in taking hard drugs and engaging in paid-for sex orgies.

Myners said the review board will report on findings and recommendations by April 2014.

In Phase 2 of the review, expected to be completed in late 2014, recommendations will be developed for strengthening links with members, as well as with other customers of the group and its employees, in a bid to quell any concerns over the bank's stability.

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