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Local authority pension funds to sue RBS

Two British pension funds are to sue Royal Bank of Scotland, Sir Fred Goodwin and the entire RBS board of directors for losses incurred when RBS was bailed out, according to The Times.

Two local authorities, North Yorkshire and Merseyside, whose pension funds have a combined value of £4bn, claim RBS and Goodwin falsely reassured investors that the bank was in good health.

They have hired Cherie Blair to represent them in a New York court. The class action lawsuit is open to all European and US investors to join.

The Times says the case can be heard in the US because RBS conducted a significant amount of business there and the courts are more flexible and less expensive.

The UK Shareholders’ Association is also forming an action group to represent Lloyds shareholders, including both former LloydsTSB and HBOS investors.

The UKSA says the views of the original LloydsTSB shareholders have been ignored in favour of the wishes of the Government and the interests of HBOS shareholders when the merger with HBOS was proposed.

It says: “We will be considering what actions we might take to oppose the further erosion of shareholder value, and creeping Government control of the bank, including legal action and discussions with institutional shareholders.”


The Tory truth

I think I may just have had my Tory moment. The aphorism goes that normal people start off their thinking on the idealist left wing but as we grow older and more cynical, so we all become Tories in the end. I never thought it would happen to me. But two months ago, this column called for the wholesale reform of the FSA and this month that was stated in a Tory report proposal.

Split picture for Friends

Friends Provident has posted European embedded value full-year profits of 420m, up from 16m in 2007, but suffered an 871m loss on an international financial reporting standards basis and a 500m deterioration in its capital position since December 2008.


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