Judge adjourns case again
RBS given a week to reach claims settlement
Royal Bank of Scotland has been given a week to thrash out a deal with shareholders to avoid a lengthy court hearing.
A judge today adjourned the case for a third time as shareholders could not agree among themselves whether or not to accept RBS’s improved terms.
They are claiming they were misled about the strength of the bank’s finances when asked to pump in more money in 2008, months before RBS was forced to accept a government bail-out.
Judge Robert Hildyard adjourned the case until 7 June to provide both sides with an opportunity to reach an out-of-court settlement but said he needed a decision by 1 June.
The judge said he understood that it was “an exceptional case with exceptional logistical problems”, but added: “We must have certainty one way or the other. The court must know whether the matter is to proceed or not.”
In a brief hearing on Wednesday, Jonathan Nash QC, for the claimants, told the judge that “progress towards a settlement remains good”.
The majority of shareholders, believed to include the businessman Trevor Hemmings, have agreed to accept the 82p per share offer, twice the original offer.
However, some are holding out for a higher deal and also want to see former chief executive Fred Goodwin explain his role in what went wrong at the bank. With a settlement now more likely to be reached he will no longer have to appear in public to explain himself.
The bank denies all the claims on behalf of its former executives but is facing a £125m bill for fighting the case.
Agreement and compensation has already been agreed with most of the shareholders who totally 27,000 at the time of the issue in 2008. There are about 9,000 claims outstanding.
It is thought some of the smaller groups of shareholders may struggle to find the financial resources to fight the trial over an estimated 14 weeks.