RBS has been hit hard by the global financial crisis
Royal Bank of Scotland (RBS) has sold its entire stake in Bank of China, the mainland's third biggest lender, for $2.34bn (£1.6bn).
RBS sold its 4.3% stake, of about 10.8 billion shares, at a price of 1.71 Hong Kong dollars per share.
It has been looking recently to sell some of its operations as it seeks to boost its balance sheet.
Shares in Bank of China had closed on Tuesday at HK$1.85. On Wednesday the shares were up 3.8% at HK$1.92.
Others to sell stakes in Chinese banks recently include Bank of America, UBS and Hong Kong billionaire Li Ka-shing.
The sale comes a couple of months after the UK government took a near-60% stake in RBS amid fears about its solvency.
"The decision to sell the stake forms part of the ongoing strategic review of the group's businesses announced in October," RBS said in a statement.
RBS was hit by exposure to the sub-prime market in the US and was also widely thought to have overpaid for the Dutch bank ABN Amro. An RBS-led consortium paid 71bn euros ($91bn; £61bn) for ABN Amro in October 2007.