ROYAL Bank of Scotland is planning to offload at least £1.9 billion worth of shares in Citizens Financial Group as it seeks to reduce its stake in the US bank.
An initial 115 million shares are being put up for grabs however the sheer volume of stock being put into the market will see it being sold at a discount.
Shares in Citizens have been trading at more than $24.80 on the New York Stock Exchange in recent days after floating at $21.50 in September.
The nature of the discount which RBS will have to offer has yet to be determined but the shares are likely to be sold into the market later this week.
One source suggested the sale was the equivalent of 100 days of volume being put into the market in one day.
The transaction will see RBS's stake in Citizen's fall from more than 70 per cent to around 49 per cent.
An additional 17.25 million shares, worth close to £290m at full price, could also be sold if demand is high. That would reduce RBS's holding to 46.1 per cent.
The Edinburgh bank is thought to be keen to offload a further tranche of shares later in the year as that will help to remove assets held by Citizens from RBS's balance sheet and strengthen its own capital position.
Following the Citizens flotation last year RBS had a 180-day lock-in when it could not sell any more shares. That period expired on Monday.
Citizens has about 1,400 branches across New England, the Mid-West and Mid-Atlantic states.
As part of its bail-out conditions RBS has to sell its entire stake in Citizens by the end of next year.
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