The UK’s Financial Reporting Council has fined KPMG £4m over its 2009 audit of the Co-operative Bank — the latest episode in the fallout from one of the country’s most serious crisis-era financial scandals.

The accounting firm and Andrew Walker, an audit partner, admitted misconduct over their verification of the bank’s 2009 results, the regulator said, and it reduced their penalties accordingly. KPMG’s fine was reduced from £5m, while Walker’s was cut from £125,000 to £100,000.