Royal Bank of Canada may buy Caribbean bank-report

(Figures in U.S. dollars unless noted)

TORONTO, Oct 1 (Reuters) - Royal Bank of Canada (RY.TO) is rumored to be the preferred buyer in "a series of Canadian suitors" for Caribbean banking group RBTT Financial Group, according to a weekend news report.

The Trinidad & Tobago Express, citing unnamed sources, reported on Sunday that RBC was preparing to buy RBTT in an acquisition worth more than $2 billion (C$1.98 billion).

The report said that a cash and stock offer was supported by key RBTT shareholders.

"We really don't comment on market rumor or speculation," Royal Bank of Canada spokeswoman Beja Rodeck told Reuters on Monday.

RBTT has merchant bank, trust, retail and commercial banking operations throughout the English-speaking Caribbean, according to its Web site.

In a research note, Blackmont Capital bank analyst Brad Smith said that such an acquisition, although unconfirmed, would mark a renewed commitment by RBC to the Caribbean, a region on which is has placed less emphasis since the mid-1980s.

If RBC, Canada's largest bank, does plan to move back into the region, it would make operating conditions "more challenging for existing market participants," Smith wrote.

Those include two of RBC's smaller Canadian rivals, Bank of Nova Scotia (BNS.TO) and Canadian Imperial Bank of Commerce (CM.TO), or CIBC, which have banking units in the Caribbean.

There had been speculation that CIBC's FirstCaribbean International Bank would buy RBTT, so it would be a surprise if RBC turns out to be the buyer, Smith said.

RBTT has been in discussions with potential buyers for months, and reported after-tax earnings of $152.2 million for the financial year ended March 31, according to its web site.

It has a network of more than 100 branches and subsidiary offices in 13 jurisdictions in the Caribbean, including Trinidad and Tobago, Antigua, Aruba, and Jamaica.

($1=$0.99 Canadian)