Advertisement
X

RBS facing three major lawsuits

London - Three of Britain's biggest investors are expected to file lawsuits against Royal Bank of Scotland next week saying they were misled over its 2008 rights issue and seeking to claw back more than 1 billion pounds ($1.68 billion), people familiar with the matter said.

Legal & General, which was the biggest investor in RBS at the time of the rights issue, is expected to file a claim, a person close to the insurer said on Friday.

File photo: Suzanne Plunkett. Credit: Reuters

Standard Life and M&G Investment Management, which is owned by Prudential, are also set to file claims, two other sources familiar with the matter said. Those firms were both among the ten biggest investors in RBS.

The claims are expected to be filed in a London court on Wednesday, the sources said.

RBS raised 12 billion pounds from a record rights issue in May 2008 to bolster its capital position, which had fallen dangerously low after the bank bought parts of ABN Amro and lost billions on U.S. credit market assets. The bank was subsequently rescued by the government, which now owns 81 percent.

The three insurers invested up to 1.2 billion pounds in the rights issue, according to Reuters calculations based on their shareholdings at the time.

RBS said it would defend the claims: “While RBS and its former directors made some business decisions that have been criticised, this does not mean that they misled investors or acted illegally.

We believe we have strong defences to the claims that are being brought against the group and that is why we intend to defend these vigorously and to protect the interests of our shareholders including UK taxpayers.”

SHOW ALL
Advertisement