Bank is first high street casualty of 2015
Loss-making Bank, headquartered in Bury, near Manchester, operates 84 stores primarily in Scotland, the north of England and the Midlands, and was part of JD Sports Fashion until November when it was sold to retail turnaround specialist Hilco.
It operates 13 stores in Scotland including four in Glasgow, two in Edinburgh and outlets in Ayr, Clydebank, Dundee, East Kilbride, Falkirk, Inverness and Livingston.
Deloitte was appointed as administrator after a review of the business determined that a solvent turnaround would not be possible.
All stores are open as normal and no redundancies have been made while Deloitte considers potential interest in the business from several parties.
Bill Dawson, a partner in Deloitte’s restructuring services practice, said: “Bank has struggled in a highly competitive segment of the retail industry and has been loss-making for a number of years.”
He added that additional sale discounts will be implemented later this week.
Mr Dawson said: “The company has already been approached by several parties who have expressed an interest in the business, and the administrators are trading as a going concern with a view to progressing these options and seeking further interested parties for some or all of the business.”
Bank was founded by Andy Scott – a former Macclesfield Town footballer – in 1994 and largely sells branded fashion items aimed at the youth market.
JD, which owns a majority stake in Scottish outdoor clothing chain Tiso, bought Bank from private equity owner Phoenix Equity Partners and management for £18.5 million in 2007.
In November it disposed of the business to HMV owner Hilco under terms which were not disclosed, although reports suggested it had been for a nominal £1.
Bank recorded a loss after exceptionals and before tax of £8.1m in the year ended 1 February, at which point it had gross assets of £51.7m.
JD’s fashion division, which includes the more successful Scotts brand, recently slumped to a half-year loss of £8.2m despite continued efforts to revive Bank, including through the appointment of a new management team.
Bank has been offering discounts of up to 70 per cent as it attempts to attract shoppers in the face of fierce competition.
Julie Palmer, partner and retail expert at Begbies Traynor, said: “The administration of Bank Fashion is hardly surprising as the struggling clothing retailer has been in the red for some time. However, as Hilco Capital acquired the business just two months ago, we would have expected it to hold on to life a little longer.”
Ms Palmer added: “With the first retail administration of 2015 hitting right at the start of the vital January sales period, I expect we’ll see more high-profile casualties emerge before the month is up.”
The company’s collapse comes a week after parcel courier firm City Link went into administration, costing the jobs of 2,400 workers.
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