Bank of Scotland  

RBS makes settlement over shareholder rights issue

RBS makes settlement over shareholder rights issue

Royal Bank of Scotland has made a settlement with the majority of claimants in the 2008 shareholder rights issue litigation.

In May this year, it was announced no former heads of RBS will face criminal charges over the company’s near total collapse which cost the taxpayer £45bn to bailout amid the financial crisis.

The Crown Counsel decided there was “insufficient evidence” of criminal conduct either in relation to RBS or any directors or other senior management involved in the case.

The verdict ended a five-year investigation by the Crown Office which looked into the sale of the bank’s shares in the months before it had to be rescued by the UK government in 2008.

RBS' announcement stated in order to minimise further material litigation expense and management distraction, the bank has concluded a final settlement with three out of the five shareholder groups representing 77 per cent of the claims by value in the 2008 Shareholder Rights Issue litigation.

According to the bank, in total, it is willing to make available settlement sums of up to £800m assuming settlement of all claims, to be split among all five shareholder groups.

As such, RBS is now seeking to agree finalised terms with members of the remaining two groups whose claims are presently continuing.  

The bank stated in its announcement any claims for which settlement is not achieved will continue to be vigorously defended.

The trial for such claims is due to commence in March 2017.

RBS' share price has risen from £1.93 from the opening of the stock exchange this morning to £1.96 at the time of publication.

Ross McEwan, chief executive of RBS said:  "We have been very clear that we wanted to deal with as many of our legacy litigation issues as possible during 2015 and 2016.

"We are pleased to have reached this agreement and hope that it will be accepted by the remaining claimant group(s) so that this long course of complex and costly litigation can now be concluded." 

ruth.gillbe@ft.com