Bankers Trust Corp. is spinning off another overseas unit in advance of its planned merger with Deutsche Bank AG in June.

The bank said Tuesday it would pull out of its Brazilian investment banking joint venture with Banco Itau. Itau will take over the U.S. bank's stake in Itau Bankers Trust Banco de Investimento SA, pending regulatory approval.

Itau is the second-largest private bank in Brazil, with a market capitalization of more than $5.6 billion and more than $40 billion of assets as of yearend 1998.

For the $133 billion-asset Bankers Trust, the move is the latest in a string of decisions to sell off overseas businesses ahead of its planned $11 billion merger with Germany's Deutsche Bank. In February, it announced plans to sell its Australian investment banking subsidiary.

Earlier this week, Bankers Trust said it would sell its Sydney-based asset management unit. Last year, it closed down a trading operation in Mexico City.

Bankers Trust is the second U.S. institution to pull out of a local investment banking joint venture in Brazil over the last few months. Salomon Smith Barney, the investment banking unit of Citigroup Inc., pulled out of a similar venture with Banco Patrimonio this year. Patrimonio was subsequently acquired by Chase Manhattan Corp.

Bankers Trust originally established the Brazilian unit in 1995 as part of an effort to develop local trading, underwriting, and fund management after selling off a minority stake in another Brazilian investment bank several years earlier.

A Bankers Trust spokeswoman in New York declined to disclose terms of the Brazil sale or comment on what other units the bank is considering selling.

In Australia, Bankers Trust's asset management unit-known as BT Funds Management Australia-has about $26 billion under management. It is Australia's largest mutual fund manager in Australia and second-largest institutional fund manager. Market sources estimated the unit could fetch as much as $1 billion.

The decision to sell the Australia unit reversed earlier Bankers Trust statements that the division would be kept up and running.

In other changes in Bankers Trust's international operations, sources said it plans to move staff out of its London building into Deutsche Bank offices. Bankers Trust might also sell its pension fund management and brokerage units in Chile.

In Japan, Deutsche Bank officials said they planned to combine assets under management at Bankers Trust with those of the German bank.

Worldwide, the combined bank is expected to have around $670 billion of assets under management, most of which will be invested in so called "passive" fund management, which seeks to match rather than exceed any rise in stock or bond indexes.

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