Royal Bank of Scotland Group PLC (LON:RBS) was a good FTSE 100 riser in late morning trading, with shares up 1.6% to 269.1p as investors awaited news on a possible settlement deal over an investor lawsuit on claims they lost money in a 2008 rights issue.
A trial had been due to start Monday, but today it was reported that the case has been adjourned until June 7 as lawyers for the two sides remained optimistic they could strike a settlement.
READ: RBS shares rise as shareholders signal willingness to accept settlement offer on rights issue
Jonathan Nash QC, representing the shareholders, told the judge, Mr Justice Hildyard this morning that while prospects of a settlement remained good more time was needed.
Shareholders have signalled they are willing to accept the bank's latest offer, which was said to have been raised to 82p from a previous 43p at a cost of more than £200mln.
[AUTOFEED] RBS trial delayed until next month; ‘good’ progress towards a settlement https://t.co/tAWFGMbWoY #FT #Company
— Yuichi (@yuichi65en) 24 May 2017
Nash said yesterday: "The majority of claimants have indicated their willingness to accept the latest offer from the defendant.
"There now appears to be a good prospect that within the course of today the remaining claimants, or nearly all, will confirm they also agree in principle so as to bring a practical end to proceedings."
However, Reuters reported that the majority state-owned lender is struggling to reach a deal with all the investors who allege the lender misled them during the £12bn cash call.
But Reuters said today that two sources late on Tuesday had told the news agency that a number of shareholders in the 9,000-strong group suing the bank remained determined to reject RBS's latest out-of-court settlement offer and take the case to trial.
A court hearing has been called for Wednesday morning at which both sides will detail any progress made in talks and could call for a further adjournment of the trial.
Low prospect of seeing former RBS CEO Fred Goodwin cross-examined in court
RBS is trying to avert a trial that will rake over events that led to its near collapse and a state bailout at the height of the credit crisis, a move which would deny investors the prospect of seeing the bank's former CEO Fred Goodwin cross-examined in court.
The lender, which remains more than 70% state-owned, denies any wrongdoing and says its former executives did not act illegally.
Investors representing 87% of the original £4bn damages claim have already settled their case..
The remaining group alleges that RBS's former executives deliberately hid over-stretched finances and failed to disclose that the regulator had ordered the bank to raise cash when it launched its rights issue in 2008.
Just months later, the government was forced to step in with a £45.8bn taxpayer-funded bailout, the largest bank rescue in history.