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Like all dream solutions, it turned out to be just that: a daydream. The good old Co-operative Bank, a venerable 130-year old Mancester-based lending institution, owned by its members, was to take over 632 bank branches from Lloyds Banking Group, the hideous conglomerate lender rescued by the British taxpayer four years ago. It was a heaven-sent opportunity for George Osborne, Chancellor of the Exchequer, to boast that new competition was entering the hated banking sector, courtesy of a friendly society with an ethical investment policy. But after a year’s negotation, the Co-op has backed out of the deal, adding insult to the government’s injury by blaming the worsening state of the economy for its decision to reverse pedal on its expansion plans.