Royal Bank of Scotland could be forced to increase its settlement offer to diehard shareholders, who are suing the bank, after it emerged that they are close to securing sufficient funds to continue their court action against the taxpayer-backed lender.
The shareholders claim that RBS and its directors misled them about the bank’s financial health in the prospectus for its ill-fated £12bn rights issue in 2008.
RBS, which is 72% owned by the taxpayer, denies the allegation. It has settled the bulk of claims in the case.
The shareholders still holding out — including current and former RBS staff — said they had raised more than £4m of the estimated £7m needed to continue the case. If they raise the rest of the cash, they could force the bank’s disgraced former boss Fred Goodwin to give evidence in court.
More than £1m was raised last week alone and the group is optimistic it will have sufficient funding to either continue the case when the court reconvenes this Wednesday, or secure a short adjournment to allow time to secure the full amount.
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A source for the rebel group said: “We’re talking to litigation funders as well as a number of high-net-worth individuals interested in the case. Negotiations with
legal funders aren’t conducted in a hurry.”
RBS boss Ross McEwan held what an insider described as an “acrimonious and feisty meeting” with representatives of the group on Friday in London. McEwan refused to increase the bank’s most recent offer of 82p a share to settle the case out of court — double the offer accepted by four other groups of disgruntled shareholders last year.
The 4,500 current and former RBS employees are seeking 92p-95p as the price for abandoning their bid to see Goodwin in court. They are joined by about another 1,000 retail investors, and together account for more than 60% of the RBS Shareholders Action Group.