Ulster Bank’s parent company Royal Bank of Scotland said it and its former bosses may have made bad business decisions in the past but that does not mean they misled investors or acted illegally, as it prepared to lodge its defence against a lawsuit from shareholders.
RBS said it planned to file its defence against a £4bn (€4.75bn) lawsuit in London’s High Court yesterday.
The Royal Bank of Scotland Shareholder Action Group is suing the bank and four former directors on behalf of about 100 institutions and 10,000 private shareholders, alleging they were misled over the bank’s financial strength in a rights issue prospectus published months before RBS almost collapsed.
Fred Goodwin, the disgraced former RBS chief who was ousted at the time of the government bailout, is among the directors accused.
“Had shareholders been given the true picture of the bank’s position, they would have had a better opportunity to assess the risks which caused the shares to collapse and led to billions of pounds of losses for private and institutional shareholders alike,” the action group said.
RBS is 82% owned by the UK government after the £45bn taxpayer bailout in Oct 2008, months after the rights issue which was announced in April.
“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,” RBS said.
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