RBS shareholders refuse to settle in effort to force Goodwin to take stand

Bailed-out bank has offered £200m in attempt to avoid case that would force former CEO to appear in court

A group of “diehard” shareholders determined to see the former Royal Bank of Scotland chief executive Fred Goodwin in court are refusing to accept a settlement in their £700m legal claim against the bank.

The state-backed lender has offered about £200m, or 82p per share held by investors, in an attempt to avoid a case that would see Goodwin take the stand on either 8 or 9 June.

About 4,500 current and former employees, some of whom are seeking a higher offer, are understood to be among those who have not accepted a deal.

Shareholder Neil Mitchell, who has previously sued RBS in a separate claim, said there was a hardcore group that would not settle under any circumstances.

“For many people, it’s never been about money, it’s been about principle and justice, and about seeing senior board members of the bank brought to trial,” he said.

“There are a lot of pensioners [among the claimants], many of whom are ex-RBS employees.

“When they went to presentations by Goodwin, they weren’t just encouraged to put their bonus in, but to put their savings in, even to go and borrow money.

“That’s why some people are diehards. But there are also financial institutions that feel the same way, that this should go to trial.”

Mitchell said the public deserve to hear more about what led to the bank’s £45bn taxpayer-funded bailout after it nearly collapsed in 2008.

The case was brought by 9,000 claimants who allege that they were misled into investing in a £12bn rights issue as the bank was close to collapse.

Reports that thousands of claimants are refusing to settle cast doubt on comments by Jonathan Nash QC, acting for the claimants, who told Mr Justice Hildyard that “progress continues to be made” on a settlement.

RBS has reached settlements with 87% of the investors after announcing in December that it had an £800m pot to resolve claims.

Hildyard has adjourned the case until 7 June. The court is not sitting next week, but has set a deadline of 1 June to know whether a settlement is possible.


Jill Treanor and Rob Davies

The GuardianTramp