The loss is more than double that of the previous year (£264.2m) "reflecting the issues of the past".
Conduct and legal risk charges increased to £193.7m in 2015 from £101.2m in 2014, due to additional provisions relating to PPI of £71.8m, CCA unenforceable interest of £58.3m and £40.4m relating to the overall cost of CCA redress.
The bank maintained that no new significant categories of conduct risk were identified, and that charges "predominantly relate to legacy issues that are common across the industry and in the case of PPI are in line with peers".
Co-op Bank has reduced costs by £76.5m to £491.9m and says it expects a return to profitability before the end of 2017.
It announced that "overall performance of the Core Bank improved during 2015" with the number of mortgage completions more than doubling year-on-year.
Niall Booker, Chief Executive Officer, said:
"In 2015 we have been successful in improving capital resilience, reducing costs and strengthening the performance of the Core Bank and the expected widening of our financial loss compared with 2014, due to legacy issues we have known about and highlighted for some time, should not distract from the considerable progress made in turning the Bank around.
"The work done in de-risking and simplifying the Bank means the business is much stronger than a year ago and, in particular, the continued strengthening of the performance of our retail franchise is encouraging for the future. Whilst the Bank as a whole will report a loss before tax in 2016 and 2017, we expect a return to operating profitability in the Core Bank before the end of 2017."
