Goodwin and co avoid public grilling as deal is struck

A trial, which was set to have disgraced former chief executive Fred Goodwin and other former directors take the stand to publicly defend their position over how much they knew about the bank’s financial health in mid 2008, will now be averted, The Telegraph has reported.

The case had centred around whether they misled shareholders when they appealed to them for a £12 billion cash injection into the bank following what proved to be the catastrophic £49 billion deal to acquire Dutch bank ABN Amro.

Reports claim that a deal has finally been struck following the intervention of RBS’s current boss Ross McEwan, as he led a last ditch attempt to avoid the expense and reputational damage of a court case.

The eleventh hour agreement now means all of the institutional investors and around 70 per cent of the smaller investors have settled, and will see those who bought into a 2008 cash call under allegedly misleading terms given compensation of 82p for every share purchased.

Four other shareholder groups had earlier accepted an earlier offer of 41.2p per share.

The newspaper has reported that the group has said “it was in the interests of all claimants” to accept the offer. “The viability of the case continuing to trial is now significantly in doubt”.

Between 40 per cent and 45 per cent of the proceeds are expected to be claimed by lawyers and financial backers of the group.