FORMER RBS chief executive Fred “the Shred” Goodwin is likely to be spared a potentially embarrassing court appearance today when investors suing RBS over its £12 billion rights issue in 2008 accept the bank’s offer of 82p per share.

News of the agreement came as the author of a book on the saga told The National that Goodwin’s appearance would have been “very dangerous” for the bank.

Ian Fraser – who wrote Shredded: Inside RBS, The Bank That Broke Britain – said yesterday: “It would be very dangerous for RBS to have Fred Goodwin defending himself and the bank.

“From a public interest perspective, this is a hugely disappointing outcome. The only chance we had that Fred Goodwin and his boardroom colleagues would be held accountable for their disastrous stewardship of RBS has now been lost.”

The RBS offer – double the bank’s previous figure – was made to the RBoS Shareholders Action Group following an 11th-hour personal intervention from the bank’s CEO Ross McEwan last weekend.

In a letter to its members – many of them former RBS staff – over the weekend, the group recommended acceptance of the offer, which is less than the 92p a share compensation some had hoped for. It is also below the £2 to £2.30 investors paid to buy shares in the rights issue nine years ago.

“Having carefully considered the merits of the current offer ... we have decided to accept the offer of 82 pence per share on behalf of our membership,” the group said in a letter published yesterday.

“This is a decision which is fully supported by our legal advisers.”

The action group had been suing the Royal Bank of Scotland Group and four former bosses: former chief executive Fred Goodwin, former chairman Tom McKillop, former investment bank head Johnny Cameron, and former finance director Guy Whittaker.

Fraser said the decision to sue the individuals was a clever move on the part of the group, because a new management team was appointed after the state bailout of the bank and "the government, including Alistair Darling, basically tried to make out there were two RBSs."

“There was the old RBS which was as rotten as hell, completely screwed up by this maniac Fred Goodwin, and they vilified him as much as they possibly could and presented him as the author of all the problems, heaped ordure on him from a massive height.

"And there was the other RBS, saying ‘I’m Philip Hampton [chairman], I’m Stephen Hester [CEO] and we’re the good guys and we’re going to sort this mess out’.

“It was like good and bad, a very polarised view, so when the claimants made their initial plans back in 2009 and sent letters of action in 2013 it was difficult for Hester and Hampton to find themselves on the same side as the people they had been vilifying for the previous couple of years.

“The other claimant groups, who settled for half the amount of this lot, just sued the bank as an entity, not its former directors.”

Fraser added that RBS had lied throughout the £12bn rights issue.

“The bank was pretending to its own investors it was in good health and just needed a bit of extra capital to promote its growth,” he said. “But the reality was it was already in serious difficulty – it could only fund itself for 24 hours, which means that when it’s getting wholesale funding in the financial markets nobody was prepared to lend to it for more than 24 hours. It was going to be a spectacular trial, and a lot of us are very disappointed it won’t go ahead.”