Former directors of the Royal Bank of Scotland, including Sir Fred Goodwin, could be sued for up to £9bn after shareholders announced plans to take legal action against the bank.
Investors, who gathered at the bank's annual meeting in London yesterday, believe they were "misled" by Sir Fred, the former chief executive, and want to recoup their losses. Some claim to have lost at least £20,000. A spokesman for the RBS action group, which represents around 7,000 shareholders, said it would try to raise funds for legal advice on the claim, which will focus on "significant errors and omissions" made at the time of RBS's £12bn rights issue in April 2008, six months before the peak of the credit crunch.
Shareholders were asked to buy new shares at 200p each: 95 per cent of the stock was bought up. But the bank, which had overpaid for its Dutch rival ABN Amro, saw its value collapse in after Lehman Brothers' downfall and the subsequent Government rescue. Its stock plunged to an all-time low of 10p in January.