TORONTO (CP) Royal Bank says it will receive $195 million US plus interest in a settlement agreement related to a soured transaction with Enron Corp., the bankrupt Houston energy company at the centre of a major accounting scandal. The settlement also involves the Enron creditors committee and Rabobank, a Dutch bank in a legal battle with Royal, which is Canadas largest financial institution. A Royal Bank spokesman said Tuesday the $195 million US the bank will receive from the settlement will reduce the amount it is owed by the Dutch bank, but in the meantime their respective lawsuits will proceed. The settlement involves proceeds from the sale of 11.5 million shares of stock in EOG Resources in the so-called Cerberus transaction that closed in November 2000. Royal maintains that Rabobank assumed the credit risk of the Cerberus transaction through an agreement between them in January 2001, and that the Dutch bank was required to pay Royal $517 million US in June 2002. Royal spokesman Paul Wilson said the settlement agreement doesnt affect the suits being bought by the bank and Rabobank. The transaction was meant as a way for Royal to reduce its exposure to Enron. We, like other banks, had other Enron risk on our books and we wanted to hedge that risk, Wilson said. The 11.5 million EOG shares had been put up by Royal as collateral for its agreement with Rabobank. They were eventually sold for $440 million US and Royals share of the proceeds was $195 million US. Royal hasnt taken a provision related to the Cerberus transaction because it remains confident it will win its litigation with Rabobank and will receive the remainder from the Dutch bank, Wilson said. Rabobank, for its part, contends in its court claim that it does not have to pay the money because Royal withheld crucial information from it about Enrons dealings. Rabobank has accused Royal of acting as Enrons henchman and of failing to inform it that the company was a house of cards liable to collapse allegations that Royal has consistently and repeatedly denied. The Cerberus transaction was one of several involving Enron and various financial institutions. In all, these transactions provided Enron with cash totalling $1.38 billion.