The warning comes as the embattled bank reports a trebling of losses during the first half of the year, rising to £204 million compared to £77 million in the same period last year.

An independent report into events surrounding the near collapse of the bank conducted by Sir Christopher Kelly in April last year included an eye-opening thirteen-page passage on a calamitous IT re-platforming project that contributed to a £300 million write-off and left the bank on the brink of collapse.

The bank has since entered an IT outsourcing contract with IBM, handed over control of mortgage processing to Capita and spent £101.9 million on project costs in the past six months alone as it bids to address a historic underinvestment in systems and processes.

"Across the Bank's IT infrastructure there are varying levels of resilience and recoverability and whilst a basic level of resilience to technical component failure is in place, the Bank does not have a proven end-to-end capability to recover from a significant and prolonged data centre outage," the bank says in its interim report.

The Co-op has already received written confirmation from the Financial Conduct Authority that the technology issue constitutes a breach of the FCA's Threshold Conditions.

The contract with IBM is intended to address the resilience of the Co-op's IT platform but is not set to be completed until late 2016.

States the bank: "Until that work is completed the Bank is exposed to a higher risk of an IT failure causing material disruption to the Bank's products and services. There are considerable execution risks in a project of this scale and complexity, including the risk that costs may exceed those originally contemplated."

As it stands, many of the bank's business, operational, reporting and financial processes rely on significant manual intervention, raising the risk of errors in the its data and financial reporting.

The scale of the task is daunting, and the bank states that process improvements are taking longer than anticipated with significant work needed to embed logical access and controls over the management of financial and customer data.

Further potential pitfalls arise in its separation from the Co-operative Group, which currently provides a number of services including critical functions such as IT, personnel, assets and to on-supply certain services, data and assets by third party suppliers.

Again, another warning: "The ongoing separation project is complex and may be more costly than currently contemplated."

Equally pressing, the bank does not have a documented right to occupy a number of its main places of business "which if unresolved could lead to disputes, additional cost and operational disruption".

Despite the challenges, Co-op CEO Niall Booker tries to strike an optimistic tone, noting that retail current account numbers remained broadly stable throughout H1 2015.

"Customers are embracing the recent improvements made to our digital banking functionality with over 700,000 now actively using online and mobile banking and over 213,000 customers have switched to paperless statements," he states. "In the branch network, the digital take up by customers has contributed to a reduction in volumes of transactions of 28%."

The bank has halved its branch network since 2013, cutting a further 57 outlets in the first half of this year.

States Booker: "This is not a sustainable level of reduction but it does show we are taking the right action in response to changing market conditions in how customers wish to conduct their day to day banking."