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Shareholders sue RBS for £4 billion

The bailout diluted the holdings of existing shareholders and the stock plunged,slashing the value of their holdings.

Written by Associated Press | London |
April 4, 2013 1:00:03 am

Royal Bank of Scotland (RBS) shareholders have filed a £4 billion ($6 billion) lawsuit against the company,claiming that they were misled into thinking the bank was healthy just before its collapse.

A group representing 12,000 investors said on Wednesday that the bank did not include vital information in the prospectus for a £12 billion share sale that took place just a few months before RBS was bailed out by the government. The bailout diluted the holdings of existing shareholders and the stock plunged,slashing the value of their holdings.

The bank is now 82 per cent owned by the British government.

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