UPDATE 2-Colonial BancGroup CEO to retire

* Says CEO Robert Lowder to retire

* Says retirement effective on completion of capital infusion

* Says will name replacement promptly (Adds analyst comments)

May 28 (Reuters) - Struggling lender Colonial BancGroup Inc (CNB.N) said Robert Lowder, its founder and chief executive, will retire.

Lowder's retirement will become effective on completion of a capital infusion from Taylor, Bean & Whitaker Mortgage Corp (TBW) and other purchasers, or sooner following the appointment of a replacement, the bank said.

Montgomery, Alabama-based Colonial has agreed to sell 600,000 voting stock of Series A Preference Shares to TBW and other purchasers for $300 million.

The bank, which has over $26 billion in assets, has to raise $300 million to qualify for $550 million of funds from the Treasury's Troubled Asset Relief Program.

"We think that TBW likely views having the longtime CEO step aside as more accommodative for effecting dramatic change at the company," Sandler O'Neill analyst Kevin Fitzsimmons wrote in a note to clients.

The capital infusion would prove extremely dilutive to existing shareholders of the company, the analyst said.