Legal action at the High Court by thousands of shareholders against Royal Bank of Scotland has been delayed for settlement talks.
A 24-hour adjournment, which was agreed by the claimants and the defendants, was granted at a brief hearing in London on Monday by Mr Justice Hildyard.
At the beginning of the much-anticipated proceedings, the judge was told by Jonathan Nash, QC, of 3 Verulam Buildings in Gray’s Inn, for the shareholders: “The parties are currently involved in settlement discussions and are hopeful of making progress.” The silk added: “They have agreed that these discussions would be facilitated by allowing a further period of time for them to continue before the trial begins.”
The judge gave the go-ahead for the adjournment on the grounds that the parties agreed there should be a delay for talks and that he had been assured that there was a prospect that the “matter can be brought to a conclusion” He added: “Obviously, I would wish to facilitate that result.”
According to reports, RBS had made a last-ditch attempt to avoid the legal battle over £700 million by doubling its settlement offer. Ross McEwan, the bank’s chief executive, is said to have told the bank’s lawyers on Sunday to offer 82p a share, although it remains unclear whether it would be accepted by investors, a report by Sky News said.
If the 14-week trial does go ahead, Fred Goodwin, RBS’s disgraced former chief executive, who was stripped of his knighthood following the bank’s near-collapse, is expected to defend his role in the lender's near-collapse at the height of the financial crisis. The legal action centres on a rights issue overseen by Goodwin in April 2008 when RBS asked existing shareholders to pump £12 billion into the bank after leading a consortium that spent £49 billion on Dutch lender ABN Amro. Shareholders claim they were left nursing hefty losses following the cash call after RBS shares plunged 90 per cent and the government was forced to step in when the deal turned toxic.
Goodwin and a raft of former executives are scheduled to be questioned as part of a £700 million lawsuit brought against the lender by 9,000 retail investors and 18 institutions in the RBS Shareholder Action Group. The majority of the claims have been settled out of court.
Goodwin will answer questions over the events leading up to the government's £45.5 billion bailout nine years ago.
Nash is instructed in the hearing by Signature Litigation, a City of London law firm. David Railton, QC, from Fountain Court chambers, and David Blayney, QC, from Serle Court, are leading the team for RBS and are instructed by City law firm Herbert Smith Freehills.