Volksbanken, in which the state holds 43 percent after a 2012 rescue, said in October it would wind itself down to avoid a looming 1 billion euro capital gap it was struggling to plug.

Its regional bank owners in the Association of Volksbanks will go on.

The bank was "investigating" the sale of the start:gruppe, spokeswoman Petra Roth said.

"We offer the units individually or as a package. The transaction is supposed to take place this year," she said.

German consultancy BDO had been tasked with the project, she said, but would not comment on whether there had been any interest yet or how much Volksbanken hoped to get from the sale.

"The aim is to strengthen the capital of the Volksbanken group," Roth said.

Volksbanken have already sold the bulk of their eastern European business. The winding down process is expected to finish this year.

(Reporting By Shadia Nasralla; Editing by Raissa Kasolowsky)