(Bloomberg News) PNC Financial Services Group Inc. has agreed to pay $3.45 billion in cash and stock for Royal Bank of Canada's U.S. retail banking unit.

PNC has the option to pay as much as $1 billion of the purchase price in stock, and also will acquire credit-card assets from RBC, Pittsburgh-based PNC said today in a statement.

The acquisition would help PNC expand its retail business in the U.S. Southeast beyond a foothold in Florida. The RBC Bank unit, based in Raleigh, North Carolina, has more than 420 branches in six states across the region. PNC Chief Executive Officer Jim Rohr, 62, told investors June 3 the bank is "disciplined" with acquisitions, preferring purchases that build 10 percent market share in "larger" cities.

"The addition of RBC Bank provides PNC a great opportunity to enter attractive southeast markets in a way that will create value for our shareholders," Rohr said in the statement.

PNC has retail operations in 15 states and Washington D.C., including more than 2,500 branches, according to the bank's website. The firm acquired National City Corp. in 2009 for about $3.9 billion in stock.

"There's an appetite for acquisitions given their capitalization and the lack of organic loan growth," Tom Lewandowski, an analyst at Edward Jones & Co. in St. Louis, said of PNC in a June 17 interview. "They're looking to go out there and purchase that loan growth."

Pulling Back

Royal Bank is seeking to sell RBC Bank a decade after it entered the U.S. with a $2.16 billion takeover of Centura Banks. Royal Bank is retreating from U.S. consumer lending as competitors Toronto-Dominion Bank and Bank of Montreal expand by acquiring troubled U.S. lenders.

RBC Bank has posted 11 consecutive quarterly losses as of March 31, with combined annual losses of about $3.1 billion since 2007, according to Federal Deposit Insurance Corp. filings. RBC Bank is the smallest of Royal Bank's U.S. operations, which also include wealth management and RBC Capital Markets investment bank.

Royal Bank rose 64 cents, or 1.2 percent, to C$54.33 on June 17 in Toronto Stock Exchange trading. PNC fell $1.68, or 2.8 percent, to $57.79 that day in New York Stock Exchange composite trading.