Citizens Financial (CFG), the Spin off of Royal Bank of Scotland launched its IPO yesterday with 7% gain. However, anyone care to know where the money is going to? Hint: Debt balance on RBS book is quite significant. Citizens Financial Rises in Market Debut By MICHAEL J. DE LA MERCED The Citizens Financial Group appears to be off to a promising start to its new life as a publicly traded bank. Shares in the midsize lender rose more than 7 percent on Wednesday after the company priced its stock below an expected price range. Citizens’ shares closed at $23.08 a share, valuing the company at $13 billion. At that level, the bank’s stock reached the low end of its initial forecasted price range of $23 to $25 a share. But the rise in the stock price still indicates interest in what is the second-biggest initial public offering in the United States so far this year, after only the enormous market debut of the Alibaba Group. A person briefed on the matter said previously that the order book for the offering was oversubscribed at the I.P.O. price of $21.50. The offering tested the appetite of investors for yet another midsize lender in a year that has brought many to seek public listings. The stock sale by Citizens was bigger than those of General Electric’s former consumer finance arm, now known as Synchrony Financial;Ally Financial, the former lending arm of General Motors; and Santander’s American auto loan arm. Initial offerings of banks and lenders have performed somewhat poorly this year, with the stocks of both Ally and Santander Consumer down since their market debuts. Shares in Synchrony remain above their I.P.O. price. Citizens’ chief executive, Bruce van Saun, acknowledged that the environment for banks has been tough at times in recent years. But he added that in an interview that the American economy is still showing some signs of growth, while the Federal Reserve has signaled that interest rates will rise at some point in the next few years, helping to bolster banks’ profitability.CreditCNBC Driving Citizens’ stock sale in large part was a move by the bank’s majority owner, the Royal Bank of Scotland, which received a government bailout during the financial crisis. The lifeline, worth more than 45 billion pounds, or $74 billion, left British taxpayers owning a roughly 80 percent stake in the bank. R.B.S. has been under pressure to improve its profitability and slim its operations down, and an I.P.O. of Citizens was considered a natural step. Mr. van Saun said that his company was ready to separate itself from its parent: While the British firm was looking to shrink, he was looking to make more investments in the business and become bigger. “We needed to be able to step back and grow the balance sheet,” Mr. van Saun said. “I think we’ll have increasing flexibility now that we’ll have public shareholders.” Ross McEwan, the British lender’s chief executive, added in a statement: “This I.P.O. represents a key step on the path to full divestment. Selling Citizens will significantly improve our capital position and help us to create a strong and secure bank that can continue to fully support the needs of its customers.” After the offering, R.B.S. will have a roughly 75 percent stake in Citizens, though it plans to sell off all of its holdings by 2016. Mr. van Saun said that much of the work that Citizens has done has been to build up important aspects of its business, including mortgages and commercial lending. Much of the firm’s history over the past two decades had been spent primarily on building up the retail side of the business, and being a public company meant that a better balance was required to please new shareholders. “There’s now a good balance between the businesses,” he said. Mr. van Saun also said that the firm has done significant work in addressing shortcomings that emerged during the Fed’s stress tests of banks earlier this year. Citizens failed a qualitative portion of the tests, something that the banking chief said would be fixed by the next round of assessments in January. “We feel reasonably good about where we’re positioned,” he said. “But there’s still a lot to do between now and when we have to resubmit in January.” The I.P.O. was run by joint global coordinators Morgan Stanley,Goldman Sachs and a group of joint book-running managers led byJPMorgan Chase. Do you think CFG is still good "BUY"?