Banco Santander announced Tuesday a cooperation pact with the Bank of Shanghai that will entail Spain's largest financial institution acquiring HSBC Ltd.'s 8 percent stake in the Chinese concern.

The deal, which requires approval from Chinese banking regulators, represents a total investment of 470 million euros ($645 million), Santander said in a statement.

Santander is set to become BoS' second-largest shareholder and its "strategic international partner," according to the statement.

BoS is to be supplied with "a permanent team of professionals, who will contribute Santander's knowledge and experience in risk management and commercial and retail banking."

BoS is China's No. 2 urban commercial and retail bank, with total assets of 98 billion euros and a net profit of 902 million euros at the close of 2012.

All but 63 of BoS' 294 branches are in Shanghai, the business and financial hub of the Asian nation, and the bank's clients include nearly 200,000 businesses, most of them small and mid-sized firms, Santander said. EFE