SHANGHAI, April 16 (Reuters) - Everbright Bank is poised tobuy a 35 percent stake in the fund venture of U.S. insurerPrudential Financial (PRU.N: Quote, Profile , Research) as the Chinese lender seeks todiversify into the country's booming asset management sector.

Two sources close to the situation told Reuters on Mondaythat Everbright Bank, which is 21 percent owned by HongKong-listed China Everbright Ltd. (0165.HK: Quote, Profile , Research), would buy the stakefrom China Everbright Group, which now holds a 67 percent stakeof Shanghai-based Everbright Pramerica Fund Management Co.

Prudential Financial now has a 33 percent stake in EverbrightPramerica, which currently manages four mutual funds worth about2.2 billion yuan ($284.9 million) in total, making it one of thecountry's smallest fund firms by assets.

After the deal, Everbright Bank is expected to become the topshareholder of the fund venture, while Prudential will maintain a33 percent stake. Everbright Group's stake will be reduced to 32percent, which is likely to be sold to Prudential Financial andEverbright Bank eventually, the sources said.

"It's actually a two-step plan ... In the first step,Everbright Bank will become the single largest shareholder of thejoint venture and it will eventually increase its stake to 51percent to strengthen its control," said one fund source. Continued...

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