Spain's leading bank Banco Santander Central Hispano said on Thursday it stands to make a capital gain of around 739 million euros (960 million dollars) by disposing of its remaining 2.57 percent stake in British bank Royal Bank of Scotland.

SCH said that Merrill Lynch had placed its 81.6 million shares in RBoS at 17.20 pounds (25 euros, 29 dollars) a share with institutional investors.

SCH had said previously it will use the funds generated by the sale for the "overall financing of our business."

Following the announcement, SCH shares were up 0.22 percent at 9.02 euros in Madrid trading.

A SCH spokesman told AFP the bank would not commment on whether Thursday's deal meant an end to the strategic alliance it struck with RBoS in 1988.

Last September, SCH sold a 2.51 percent stake in RBoS for 1.73 billion euros for a capital gain of 472 million euros, as the Spanish firm was launching its successful bid for British bank Abbey National for 13 billion euros.

According to the SCH spokesman, RBoS held a 2.83 percent stake in SCH prior to the Abbey deal but he was unable to specify the current RBoS stake which, according to Spanish news agency Europa Press, has since dropped to 1.88 percent.

The SCH acquisition of Abbey National, the largest-cross border banking merger ever in Europe, made the Spanish firm the largest bank in the eurozone as measured by market capitalisation.