The Crown has been undertaking an independent investigation since an FSA report was published in 2011.
After five years, Crown Counsel have decided that there is "insufficient evidence in law of criminal conduct either in relation to RBS as an institution or any directors or other senior management involved in the rights issue".
The UK Government rescued RBS in 2008 with a £45bn bail out. 72.6% of RBS is still owned by taxpayers, down from 84% during the financial crisis.
In a statement, The Crown Office said:
“This was an extremely complex investigation which included the examination of over 160,000 documents by a team of specialist forensic accountants and banking experts, supervised by the Serious and Organised Crime Division.
“The investigation involved close co-operation with a range of financial regulators and banking institutions, including the Financial Conduct Authority, the Prudential Regulation Authority, the Federal Reserve Bank of New York, the Serious Fraud Office and the Financial Reporting Council.
“If any further evidence comes to light which is relevant to this enquiry it will be considered by the Crown and we reserve the right to make further enquiry, if considered appropriate.”
In March, RBS paid £1.2 billion to the Treasury, ending the Dividend Access Share which gave the government priority over dividends. The Dividend Access Share was issued in 2009 after the government bailed out the bank.
However dividends for ordinary shareholders are still some way off, according to industry insiders, who expect this to begin in 2017 at the earliest.
