Seeking to cash in on high U.S. stock prices, Bank of Ireland is negotiating to sell its 23.5% stake in Citizens Financial Group to the majority owner, Royal Bank of Scotland PLC.

Though no price has yet been set, market sources estimated that Bank of Ireland could get as much as $750 million for its stake in the Providence, R.I.-based banking company. That would be a tidy profit on the stake, which was valued at $435 million when Bank of Ireland acquired it from Royal Bank in 1996.

Royal Bank is obligated to buy Bank of Ireland's holding under the 1996 agreement that merged the two banks' U.S. operations. Though the sales option has no expiration date, the Irish bank decided to act while U.S. bank valuations are high.

"Now seemed as good a time as any to exit," said Paul D'Alton, finance director at Bank of Ireland, Dublin. He said the sale could be completed in six to eight weeks.

Mr. D'Alton added that Bank of Ireland decided to sell its stake in Citizens after both the stock market and the bank itself determined that a minority position "was not necessarily a long-term hold."

The pending sale has fueled speculation that Royal Bank, which would own Citizens outright, might in turn consider selling the $17.2 billion-asset company, seeing only limited opportunities for expansion. A sale would be less complicated with only one owner in the picture, market sources said.

Analysts cited BankBoston Corp., Fleet Financial Group, and First Union Corp. as among the potential buyers, estimating that Citizens could fetch upward of $3 billion.

"Analysts have been saying to Royal Bank of Scotland that now's the time to sell because they'll get top dollar," said Hugh Pye, a bank analyst with Robert Fleming Securities in London."If they wait too long, valuations will fall and they will have missed the boat."

However, Bob Speirs, group finance director at Royal Bank of Scotland, dismissed speculation that the Edinburgh bank is considering selling Citizens.

"We have no intention of selling at this time, and nobody has a mandate to sell Citizens," Mr. Speirs said in a telephone interview.

A spokeswoman for Citizens said that although there has been some shareholder interest in a sale, "it is a minority view."

She added that Bank of Ireland's planned sale of its stake "would not be a dramatic change for Citizens," since the bank has been involved with the company for only two years.

Citizens has 280 branches since last week's acquisition of Woburn National Corp., parent company of $160 million-asset Woburn (Mass.) National Bank.

Citizens' net income for the quarter ended June 30 totaled $50.1 million, an 11% increase from a year earlier. Net income for the nine months ended June 30 was $150.5 million, up 31% over the previous nine- month period. (The company's fiscal year runs Oct. 1 to Sept. 30.)

In 1988 both Royal Bank and Bank of Ireland bought U.S. banking companies in a move to diversify beyond their home markets. Royal Bank acquired Citizens outright, and Bank of Ireland acquired First NH Banks of Manchester, N.H.

By the early 1990s, however, both banks were forced to pump in millions of dollars to rebuild capital after New England banks were ravaged by back- to-back recessions in the region and in the United States as a whole.

Though both New England banks subsequently posted strong improvements in earnings, Bank of Ireland sold First NH Banks to Royal Bank in April 1996 for $235 million cash and a 23.5% stake in Citizens Financial. First NH Banks was merged into Citizens.

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