Sumitomo Mitsui reportedly sniffing around RBS' U.S. retail unit

|About: Sumitomo Mitsui Financia... (SMFG)|By:, SA News Editor

Sumitomo Mitsui Financial Group (SMFG -1.8%) has held discussions with Royal Bank of Scotland (RBS +2%) about purchasing RBS's U.S. retail operation - RBS Citizens - reports the WSJ. Citizens has nearly 1.4K branches and $122B in assets across 12 states, and its sale would be among the largest U.S. deals since the crisis, and one of the largest-ever purchases of a U.S. bank by a foreign company.

Citzens is a coveted target by acquisitive banks (TD has been rumored to have great interest), but RBS - despite being under heavy U.K. government pressure to raise capital - has been a reluctant seller. That attitude is starting to change, says the Journal, with new CEO Ross McEwan saying he wants to refocus the bank on its core U.K. market.

The current plan is for an IPO of part of Citizens later this year to raise in the area of $10B, with a full exit by the end of 2016.