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More woe for Scottish bank

RBS may face £8 billion bill to settle US legal claim

RBS GogarburnRoyal Bank of Scotland is facing a bill for £8.33 billion in the US to settle claims that it misled investors in mortgage-backed securities, according to court documents.

The size of the settlement hangs over the government’s plans to begin selling the bank back into the private sector and may hold the process.

The estimate has been made Philippe Selendy, a lawyer for Quinn Emanuel, which has brought the case for the US Federal Housing Finance Agency and is based upon a previous judgement in a separate case involving RBS.

Nomura and RBS were ordered last month to pay a collective $806 million for making false statements in selling mortgage-backed securities to Fannie Mae and Freddie Mac.

RBS has so far set aside £1.9bn pounds for deal with the claims, which relate to the sale of about $32 billion of mortgage-backed debt in the United States.

 

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