Under the deal, Kent Reliance's assets and liabilities would be transferred to a new bank, which would become a subsidiary of a new mutual organisation, the Kent Reliance Provident Society.
JC Flowers would receive shares and convertible preference shares in the bank in return for a £50m capital injection.
The deal still requires the backing of Kent Reliance's customers as well as the approval of the Financial Services Authority.
Kent Reliance also said it was likely to clinch similar deals with other mutually-owned British lenders.
"It's fair to say we wouldn't be surprised if in time other societies had an interest in a similar partnership," JC Flowers' Europe and Asia Pacific head David Morgan said, adding the group was looking "very actively" for more investments in the UK, Ireland and Spain.