RBS faces scrutiny as expensive High Court battle with shareholders begins

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Royal Bank of Scotland will come under the spotlight today when it faces a costly High Court battle with shareholders.

Former boss Fred Goodwin is expected to defend his role in the lender's near collapse during the financial crisis during the course of the 14-week trial at London's High Court.

Mr Goodwin and a raft of former executives are in line for a public grilling as part of a £700 million lawsuit brought against the lender by 9,000 retail investors and 18 institutions in The RBS Shareholder Action Group.

The majority of the claims have been settled out of court.

The disgraced former chief executive Mr Goodwin - who was stripped of his knighthood following the bank's near collapse - will answer questions over the events leading up to the Government's £45.5 billion bailout nine years ago.

The legal action centres on a rights issue overseen by Mr Goodwin in April 2008 when RBS asked existing shareholders to pump £12 billion into the bank after leading a consortium that spent £49 billion on Dutch bank ABN Amro.

Shareholders claim they were left nursing hefty losses following the cash call after RBS shares plunged 90% and the Government was forced to step in when the deal turned toxic.

Despite the bank making significant headway in resolving the dispute, it has been unable to strike a deal with the last tranche of shareholders.