The Co-operative Group has announced losses of £2.5bn for 2013, marking the worst results in the group's 150-year history.
The group said most of the losses stemmed from the Co-operative Bank, which amounted to £2.1bn.
That included a trading loss of £1.44bn for the year to December, when the group lost control of Co-op Bank to US hedge funds.
Chief executive Richard Pennycook said 2013 had been a "disastrous" year.
He added: "These results should serve as a wake-up call to anyone who doubts just how serious the challenges we face are.
The Co-op Group chief executive has laid it on the line - this business needs to reform or it will face dire consequences. His words about "management failings" and these results being "disastrous" and the "worst in our 150-year history" are a clear message to anyone who thought that the business could carry on in the same way.
What is also of concern is that group sales and underlying profit are both down. That signals that while past mistakes might make up the vast bulk of the losses, the present business (supermarkets, funerals, pharmacies and insurance) still has its own problems.
Glimmers of hope? Net debt is down, convenience store like-for-likes are up and the sale of the pharmacies and farms business could bring in some much needed cash, probably numbered in the hundreds of millions. But the group has an awfully long way to go.
"The scale of this disaster will rightly shock our members, our customers and our colleagues,"
SomerfieldIn addition to the trading losses at the bank, the group took another charge of £625m when it handed over 70% of the bank's shares to bond investors.
The company also wrote down the value of the Somerfield store chain by £226m.
Mr Pennycook said the Co-op Group would be refocusing its strategy in its food division on smaller convenience stores in towns and villages which he said had worked "very well for us".
As part of that strategy the Co-op plans to open 100 news convenience stores this year.
But he added the acquisition of the Somerfield supermarket chain in 2008 had left the Co-op Group with a large number of very large stores, which were not working.
As a result, he said the Co-op would "exit 60% of Somerfield acquisitions".
Bank lossesThe Group's losses were widely expected - in its half-year results the Co-op Group had reported pre-tax losses of £709m.
At the same time it revealed £496m in impairments and the £1.9bn black hole in balance sheet of its banking arm, which had scuppered the planned takeover of 632 Lloyds banks branches and caused the near collapse of the Co-op Bank.
Last week, the Co-op Bank reported pre-tax losses of £1.3bn for 2013 and said it did not expect to make a profit in 2014 or 2015.
The collapse of the Lloyds deal and the parlous state of the bank's balance sheet led to the takeover of the bank by its bondholders in December leaving the Co-op Group with a 30% stake in the business.
That stake could be diluted further after the discovery of another £400m hole in the bank's balance sheet in March.
The Co-op Bank is considering issuing new shares to raise the money it needs to fill the £400m gap.
As a result Co-op Group would need to find another £120m to maintain its 30% shareholding.
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