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Royal Bank of Scotland has settled with a group of investors over its 2008 rescue fundraising, damping the prospect of bringing former disgraced chief executive Fred Goodwin and the bank to court in the coming weeks.


The state-backed lender revealed on Thursday that it has settled with shareholders representing 40 per cent of the value of the remaining group of claimants.

As part of this settlement, RBS has set aside less than £10m to cover the legal costs incurred by these claimants since the end of last year, when the bank settled with other shareholder groups.

However, the settlement deals a blow to remaining shareholders, including thousands of individual investors, who were hoping to take Mr Goodwin to court in May.

The shareholders allege former directors of RBS, including Mr Goodwin, misrepresented its underlying strength at the time of the £12bn rights issue.

A few months after the rights issue, RBS received a £45bn bail-out from taxpayers, which led to large losses for investors.

RBS agreed at the end of last year to pay out about £800m to settle the allegations. It has now settled with shareholders representing nearly 90 per cent of the original claims by value.

Ross McEwan, CEO of RBS, said: “We have been very clear that putting our legacy issues behind us is a priority so that we can focus on building the best bank for our customers, shareholders and employees.”

He added that RBS will continue to pursue a settlement with the remaining claimants but is prepared to “defend the claims at trial” if it cannot be agreed.

Copyright The Financial Times Limited 2017. All rights reserved.
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