RBS offers £200m compensation to adjourn court case brought by 9000 investors

RBS offers £200m compensation to adjourn court case brought by 9000 investors

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Royal Bank of Scotland has offered £200m to adjourn a court case brought by 9000 investors that were misled into buying bank shares before the taxpayer bailout in 2008.

The trial was due to begin, but has been adjourned for the third day. Judge Robert Hildyard has given RBS and Investors a week to reach an out-of-court settlement.

The talks between RBS and investors are being held to prevent the case being heard in the High Court and release ousted former RBS executive, Fred Goodwin from giving evidence in his scheduled trial on June 8.

Investors have accused the bank, Fred Goodwin and three former boardroom colleagues, of misleading them about the financial state of the lender before the £12 billion rights issue in April 2008. Months before, RBS was bailed out by the taxpayer.

There are about 9,000 private investors, major city institutions and local authority pension funds involved in the case. The bank is said to have made the investors an offer to the worth £200 million based on 82p a share.

Last year, 78 percent of shareholders were awarded 41.2p for each RBS share. A further 2p per share was added to the settlement last month taking the number who accepted the deal from the bank to 87 percent.

Judge Robert Hildyard has given RBS and Investors until June 1 to notify him if a deal had been agreed to avert court proceedings.

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