* Bank of China to be Deutsche Boerse clearing partner-sources
* Deal would ease cross-access to capital markets
* UK seen signing clearing deal with China next week (Adds context, financial source)
FRANKFURT, March 28 (Reuters) - Deutsche Boerse and Bank of China are set to sign a strategic partnership agreement that would make it easier for Chinese and European investors to gain access to each other's capital markets, two sources with knowledge of the matter told Reuters on Friday.
The deal, which will make Bank of China a trade and clearing partner of Deutsche Boerse, will be sealed on Friday in Berlin during a state visit of Chinese President Xi Jinping, the sources said.
The agreement will make it easier for investors and companies in Europe and China to issue and own bonds, shares, funds and pay bills in each other's regions.
Up to now, transactions in China's currency, the renminbi or yuan, have been impractical for all but very large European companies that are able to involve China's central bank in a deal, because the renminbi is not freely convertible.
"It has been too complicated for private individuals and too time consuming for medium sized companies to do," said one of the sources.
"Capital exchanges in renminbi will be a lot easier as a result of this deal and that will be to the advantage of both Chinese and European investors, both in the real economy and the financial sector," the source added.
Sources told Reuters earlier this week that Germany's and China's central banks were set to strike an agreement this week that would set a framework for cooperation and make Frankfurt the first hub for renminbi payment transactions in Europe, pipping a similar agreement with London expected to be sealed next week.
Deutsche Boerse declined to comment. (Reporting by Alexander Huebner and Jonathan Gould; Writing by Harro ten Wolde; Editing by Marilyn Gerlach and Sophie Walker)