Talks stall over compensation levels in RBS rights issue action

RBOS Shareholder Action Group includes about 100 institutional investors and thousands of private investors.

RBS has vigorously contested its claims that shareholders were misled about the financial strength of the bank at the time of the cash call that immediately preceded the Edinburgh-based lender’s collapse and eventual £45 billion government bailout.

RBS remains more than 70 per cent state-owned to this day.

According to The Scotsman newspaper, lawyers were locked in negotiations last weekend over the size of the settlement that it has been hoped will head-off a full-scale court action in London in May.

The newspaper quotes one source who put the odds of a successful deal at “no better than 50-50” prior to last weekend’s talks.

But following the meeting another suggested the parties remain as far apart on price as ever.

“People are getting overexcited,” the source told the paper. “Currently, the RBS offer is worth about 41.5p a share to investors. That is unlikely to be acceptable to investors, and yet the bank is simply not moving on the issue.

“The legal advice the shareholders have received is that the claim value should be somewhere between 97p and 245p a share.”