(Adds detail, BoE reaction)
LONDON, June 23 (Reuters) - Britain's Serious Fraud Office (SFO) has found no evidence of criminality in its investigation into how the Bank of England (BoE) pumped liquidity into the financial system to support banks during the financial crisis, it said on Friday.
Auctions of central bank funds in return for collateral such as bonds took place in 2007 and 2008 during a crisis that ultimately forced taxpayers to bail out lenders such as Royal Bank of Scotland and Lloyds.
"The focus of the investigation was whether assistance had been provided to certain financial institutions to enable them to bid successfully for the available funding, to the possible detriment of other institutions," the SFO said on Friday.
"After a thorough investigation the SFO has concluded that there is no evidence of criminality in relation to this matter."
The SFO said it has now closed its investigation.
The BoE said the events under investigation occurred nearly a decade ago at a time when a number of Britain's large financial institutions were under unprecedented stress.
The financial crisis exposed shortcomings in the BoE's frameworks for providing liquidity insurance, operating procedures and governance arrangements, the Bank said in a statement.
After the SFO's decision to open an investigatation, the Bank's Court of Directors commissioned a "rigorous and comprehensive" review of other key market operations during the financial crisis.
"The review resulted in a number of recommendations, which the Bank has now implemented," the BoE said, adding that details of the review were published on Friday.
"The Bank is proud of the dedication and professionalism displayed by its staff during the financial crisis," it said.
Editing by David Goodman