The deal is expected help the German bank lift its capital ratios, and is seen as part of the restructuring undertaken by the bank’s new leadership.
The transaction is subject to regulatory approvals and customary closing conditions including that of the China Banking Regulatory Commission.
Caps on foreign ownership have made it difficult for foreign financial firms to do banking business in China, Reuters reported.
Several European and American banks have divested their share in Chinese banks, often maning profits in the process.
With the transaction, Deutsche Bank will have a positive financial impact, it said in a statement.
Deutsche Bank co-chief executive officer John Cryan said: "We made our first equity investment in Hua Xia Bank in 2006. Since then, we have been pleased with Hua Xia Bank’s development and performance.
"As we execute on Deutsche Bank’s strategic agenda, now is the right time for us to sell this investment. China remains a key growth market for us where, since opening our first local office in 1872, we have helped our clients to achieve their goals.
"We look forward to working with Hua Xia Bank and PICC Property and Casualty Company Limited on the transition of our investment."
As part of its restructuring, Deutsche Bank is cutting 15,000 jobs, close certain businesses and suspend dividends for two years.
Image: Deutsche Bank sells its stake in Hua Xia Bank. Photo: courtesy of of adamr / FreeDigitalPhotos.net.
