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RBS reaches $4.9B tentative settlement in mortgage-backed securities case

Jaclyn Jaeger | May 14, 2018

The Royal Bank of Scotland Group hs reached a tentative settlement of U.S.$4.9 billion (£3.6 billion) with the U.S. Department of Justice concerning the sale of toxic residential mortgage-backed securities between 2005 and 2007.

Of the U.S.$4.9 billion civil penalty, RBS said that U.S.$3.46 billion “will be covered by existing provisions, with an incremental charge of U.S.$1.44 billion” in the second quarter 2018.

Calling the settlement “a milestone moment for the bank,” RBS CEO Ross McEwan said the settlement in principle “will, when finalized, allow us to deal with this significant remaining legacy issue and is the price we have to pay for the global ambitions pursued by this bank before the crisis.”

The proposed settlement is subject to the Department of Justice and RBS entering into a legally binding agreement, and there can be no...

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