The Co-op Group chairman, Len Wardle, has resigned following revelations about its former banking chairman, Paul Flowers, who was exposed by a man he met on Grindr for allegedly using and dealing in hardcore drugs.

Mr Wardle, who led the board who appointed Mr Flowers, said he felt it was “right” that he stepped down.

He had announced last month that he would leave in May 2014 – but has now resigned with immediate effect.

“The recent revelations about the behaviour of Paul Flowers, the former chair of the Co-operative Bank, have raised a number of serious questions for both the bank and the group,” Mr Wardle said in a statement.

The Mail on Sunday published video showing Mr Flowers, 63, who is also a Methodist minister, discussing a purchase of cocaine and crystal meth from a dealer in Leeds.

In the footage Mr Flowers counts out £300 in £20 notes.

Mr Flowers, who was chairman of the bank from April 2010 to June this year, gave evidence to MPs on the House of Commons Treasury Committee on 6 November.

The recording was allegedly made three days after the committee hearing.

One of the committee members, Conservative MP Brooks Newmark, said the Co-op Bank had questions to answer about its appointment procedures.

Texts of Mr Flowers mentioning how his plans for a party were “turning into a two day, drug fuelled gay orgy!!!” were also published by the Mail, after Stuart Davies, a 26-year-old man Mr Flowers had met on Grindr earlier this autumn, went to the paper to expose Mr Flowers’ apparent drug use and drug dealing.

Mr Flowers apologised for his actions yesterday. “This year has been incredibly difficult, with a death in the family and the pressures of my role with the Co-operative Bank,” he said.

“At the lowest point in this terrible period, I did things that were stupid and wrong.

“I am sorry for this and I am seeking professional help, and apologise to all I have hurt or failed by my actions.”

West Yorkshire Police said in a statement it had not received a report in relation to the matter “but has been made aware of the allegations made in the Mail on Sunday article and are now making further enquiries”.

Mr Flowers, who lives in Bradford, has been a minister for almost 40 years and served as a Labour councillor for Bradford Council for 10.

Earlier this year, the Co-op Bank came close to collapse after pulling out of a deal to buy hundreds of Lloyds Bank branches.

The Co-op blamed the economic environment and increased regulations for its withdrawal in April but it was later found to have a £1.5bn capital shortfall.

The bank lost £700 million in the first six months of this year.