Postal Savings Bank of China, which has the most branches of any Chinese lender, could reportedly raise no less than $1bn from investors ahead of a planned multi-billion dollar initial public offering (IPO).
The lending unit of state-owned China Post intends to sell the stake this year, Bloomberg reported.
Investment banks are pitching for roles on the pre-IPO stock sale, but the exact size of the deal has not been decided as yet, the report added.
Pursued by Bloomberg, the bank's general office did not take calls seeking comment.
Postal Savings Bank is bringing in outside investors as China seeks to instill more market discipline in its state-owned enterprises.
The lender, with nearly 40,000 branches mostly in China's vast countryside and over 470 million retail customers, is boosting its capital strength as part of a government directive to focus on lending to small businesses and rural areas.
The bank plans to raise over $4bn (£2.66bn, €3.56bn) through planned Hong Kong and Shanghai flotations, the news agency reported earlier.
Postal Savings Bank had 5.57tn yuan ($891bn) in assets at the end of 2013, making it China's sixth-largest lender by that gauge.
The Beijing-based bank was established in 2007 and has outlets in post offices scattered across the country.
Post offices in the world's second-largest economy rolled out postal savings services in 1986.