Ross McEwan, the new chief executive of part-nationalised RBS, announced in November an acceleration in the stock market listing of Citizens with the first share sales expected in the second half of this year.
This is intended to shore up the bank's capital buffer.
Bruce Van Saun, the former RBS finance director who is now executive chairman of Citizens, said: "This transaction will allow us to focus our efforts on our primary Citizens Bank and Charter One markets where we have stronger market positions and better long-term growth prospects."
He added: "We feel that US Bank is a good buyer of our Chicago region branch-based business, and we will work hard to ensure a smooth transition for our customers and colleagues who will be going to US Bank."
Citizens is a relatively small player in Chicago and the sale is intended to focus the bank as RBS seeks to sell an initial stake this year and offload the rest by the end of 2016. The original plan, outlined in February, had been to start an initial public offering in two years' time.
The sale includes 94 branches of its Charter One brand, $5.3bn in local deposits and $1.1bn in locally originated loans for a deposit premium of around $315m.
Citizens will continue to operate a commercial bank and mortgage lending in Chicago.