This figure is dramatically down on the £845m recorded a year ago following a reduction in the level of credit impairments and lower payouts for PPI mis-selling. During the first six months of the year the mutual also trimmed staff numbers by 13 per cent in order to reduce losses.

Co-op Bank said mortgage sales had been ‘affected’ by the arrival of the Mortgage Market Review in April.

The bank also said it had set aside £37.6m or potential customer redress relating to the processing of first payments on certain mortgages, £31m for redress in relation to mortgage fees and £9m in relation to mortgage documentation.

Chief executive Niall Booker said: “Transforming the organisation into a viable and profitable business in the long term still requires significant change – both operationally and culturally.

“In the first half of 2014, the financial performance of the business, although still dominated by the issues that came to light during 2013, was considerably better than the same period last year. The statutory loss before taxation was £76m compared to a loss of £845m at half year 2013.”