Merseyside and North Yorkshire local authority pension funds are suing Royal Bank of Scotland (RBS) for compensation.
The funds accuse RBS of withholding the extent of the bank’s problems before its government rescue last year.
The legal action against RBS has been launched in the US.
Other UK pension funds are said to be considering joining them.
They will be represented by Cherie Booth QC, wife of Tony Blair.
Peter Wallach, head of the Merseyside Pension Fund said: ‘The purpose of the litigation from the side of Merseyside Pension Fund is to hold management to account.’
RBS gained an extra £12bn from shareholders following the conclusion of a successful share issue in June of last year.
Yet just five months later in November, the bank needed to accept a £20bn rescue package from the government in exchange for a 58 per cent stake in the bank, which was subsequently increased to 68 per cent.
The then RBS bosses, led by Sir Fred Goodwin, have subsequently stood down from the bank.
At the same time, the RBS share price has collapsed, down from 243 pence immediately after the June share issue to the current 22.5p.
Wallach said he wished to ascertain whether statements made by the former RBS bosses before the share issue and subsequent government rescue ‘were in any way inaccurate or misleading to shareholders’.
He added: ‘Our concern is that perhaps management didn’t indicate to shareholders the full extent of the deterioration in the bank’s finances when it first came to shareholders for additional capital.’
The legal action has come in the shape of a US class action civil lawsuit, which enables a number of complainants to join together and make one, collective claim.
Wallach added that the case was being take on a no-win, no-fee basis, so there was no risk to its pension holders.
l Responding to projections by Universities UK (UUK) which show that graduate debt would rise to over £32,000 if top-up fees were raised to £7,000 a year, the National Union of Students (NUS) yesterday urged the government to consider alternatives to fees in order to fund the higher education system in England.
The UUK report also suggested that graduates would owe an average of over £26,000 if the cap on fees were raised to £5,000.
At a lobby of parliament tomorrow, the NUS will be launching its own report on higher education funding, entitled ‘Five foundations for an alternative higher education funding system for England’.
Warning against letting ‘market forces run riot’, NUS President Wes Streeting said: ‘This UUK report assumes that higher fees are inevitable, and that the shambolic current system of student support will remain in place.
‘We believe there is an alternative way to fund higher education that is fairer for students, but still generates the kind of income the sector so badly needs.
‘That is why, on Wednesday, we will be talking to MPs about a number of radical proposals, including making higher education free at the point of use, with graduates making a contribution depending on how much they are benefitting financially from their own use of the system.’