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Rhode Island-based regional lender Citizens Bank is getting out of the auto loan business next month.

The bank announced this week the decision was “part of its strategy to optimize its balance sheet and emphasize relationship-based lending.”

The bank plans to retain and continue servicing existing auto loans on its balance sheet, but will stop originating the loans July 1. The company said it has been reducing its active relationships with car dealers since the third quarter of last year and had $11.5 billion in outstanding auto loans on its books as of March 31 of this year. That’s down 6.5 percent from the end of 2022, it said, and down 20.1 percent from March 31, 2022.

“As Citizens continues to optimize its balance sheet, this decision further enables us to lend in areas that provide better risk adjusted returns and improved opportunities to deepen relationships with our customers,” Citizens’ head of consumer lending Eric Schuppenhauer said in a statement. “We greatly appreciate the opportunity to have been the lender of choice for thousands of dealership partners over the years and are thankful for the dedicated team of colleagues that have delivered exceptional service.”