RBS High Court trial set to take place this week

FT.com, 21 May:

Disgraced former Royal Bank of Scotland chief executive Fred Goodwin will be back in the spotlight in a High Court trial starting this week that will delve into the disastrous events at the bank in 2008.

The £700m High Court case has been brought by thousands of RBS shareholders who allege they lost money in a £12bn rights issue launched by the bank in June 2008. A few months later, RBS had to be bailed out by the British government to the tune of £45.5bn.

The investors claim the rights issue prospectus contained misleading statements about the true financial position of RBS under Mr Goodwin’s leadership. RBS and four ex-directors named as defendants including Mr Goodwin deny wrongdoing. Mr Goodwin will testify under oath for the first time during the trial.

UpdateReuters, 22 May, 10:14am:

Royal Bank of Scotland … has tried to reach a last-minute settlement with a group of investors who allege that the lender misled them over a 2008 capital increase, according to two people close to the matter.

A successful settlement would save RBS from a lengthy and potentially embarrassing trial, at which its former Chief Executive Fred Goodwin would face scrutiny over his decision-making and leadership at the time of the lender’s near-collapse.

Update IIReuters, 24 May, 12:13pm:

A British judge has given Royal Bank of Scotland … a week to avoid a trial by reaching a deal with investors who allege the bank misled them over its 2008 fundraising.

Judge Robert Hildyard adjourned the case on Wednesday until June 7, but warned this would be the final chance to reach an out-of-court settlement and said the two sides must inform him whether a settlement has been reached by June 1.

RBS has already offered almost 1 billion pounds ($1.3 billion) to avoid a trial that would rake over its near collapse and state bailout during the height of the credit crisis and bring former chief executive Fred Goodwin to court.

Update IIIFT.com, 29 May:

Fred Goodwin, the former chief executive of Royal Bank of Scotland, is likely to escape a potentially embarrassing court appearance after the bank reached a legal settlement in principle with a shareholder action group.

The group, which represents about 9,000 RBS investors, said on Monday that it would accept 82p a share from the bank.

Leave a Reply

Your e-mail address will not be published. Required fields are marked *