Home Business NewsBusiness RBS agrees to $4.9bn ‘milestone’ settlement with US

RBS agrees to $4.9bn ‘milestone’ settlement with US

10th May 18 9:46 am

Investigation into its sale of mortgage-backed securities

Royal Bank of Scotland has agreed in principle to pay $4.9bn (£3.62bn) to resolve a US investigation into its sale of mortgage-backed securities, clearing the way for the British government to sell more shares in the bank.

RBS said that $3.46bn of the proposed civil settlement would be covered by existing provisions and that the bank would take a $1.44bn charge in the second quarter to cover the rest.

Announcing the preliminary agreement on Wednesday, RBS Chief Executive Ross McEwan called the deal a “milestone”. “Removing the uncertainty over the scale of this settlement means that the investment case for this bank is much clearer,” he further said.

The U.S. Attorney’s Office in Massachusetts, which led the investigation, also confirmed: “Further details remain to be negotiated, however, before a formal agreement can be reached.”

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