LONDON, May 2 (Reuters) - Britain's Co-Op Bank said on

Thursday talks for its takeover by Coventry Building Society

were "well advanced" and its multi-year revamp was now

materially complete, after reporting first quarter financial

performance in line with expectations.

" are now working together on the next stages. In the

meantime, we remain focused on delivering our strategic plan and

great service for all our customers," Nick Slape, the chief

executive officer, said in a trading update.

Co-Op Bank also said it had secured an investment grade

credit rating and its long-term deposit rating had been

upgraded to Baa3 by Moody's in March.

Slape said the improved credit rating would enable the bank

to diversify its customer base by growing our corporate banking

book, as well as provide enhanced funding capabilities.