Toast the coconut, if desired, by spreading out in a thin layer on a baking sheet in a 350F oven. Toss every 3-5 minutes until just starting to turn a light brown. Remove and set aside. (Toasted coconut deepens the coconut flavor).
Cut the bread into 1.5 inch cubes. Set aside.
Whisk together the remaining ingredients in a large bowl, using the juice of one lemon. Add the bread and toss to coat.
Coat a 9 by 13 inch baking dish with cooking spray. Pour the bread pudding mixture into the dish. Cover and let sit at room temperature for 20 minutes.
Preheat oven to 325F.
Bake the pudding on the lower middle rack until it is golden brown and puffing up around the edges, with a slight jiggle in the middle, approximately 45-50 minutes.
Let cool for 30-45 minutes before serving warm. Top with additional chocolate chips, chocolate sauce, and caramel sauce if desired. This pudding is great served with whipped cream or ice cream.
Our Quick Coconut Bread is best for this recipe because it brings extra flavor, but any type of bread will work, especially a crusty bread like French or rustic bread. A 9.5 inch loaf was the perfect amount to get 8 cups.You can let the bread soak in the refrigerator for up to 24 hours if needed.