RBS to cut stake in US bank Citizens

The Royal Bank of Scotland is selling more of its stake in the US bank Citizens.

The sale of the shares, worth up to $3.3bn (£2.2bn), will mean that the UK bank owns less than half of Citizens.

It is part of a plan by the state-owned bank to concentrate more on its main UK retail business and reduce its operations abroad.

RBS bought Citizens for $440m in 1988 and turned it into one of the biggest regional banks in the US.

It first sold part of the US company in September last year in an initial public offering.

RBS, which has been 80%-owned by the UK government since being bailed out in 2008, is expected to have sold all of its stake in Citizens by the end of 2016.

On Friday, Citizen shares closed at $24.80 each - a rise of 15% since they started trading in September.

RBS has been trying to streamline its business in order to return to profit. It is pulling out of 25 countries, lowering the number that it operates in to 13.

Thousands of job losses are expected - most of which are likely to be outside Britain.

"The days when global domination mattered more to RBS than great customer service are well and truly over," chief executive Ross McEwan said in February, when the company reported results.

"RBS will be stronger, it will be simpler and it will be much more focused on the UK large corporates and the western European corporates and our big financial institutions," he said.

The bank reported a loss for 2014, largely as a result of writing down the value of its Citizens business by $4bn.

However, its underlying profits showed it benefitting from an improving UK economy.