The 26-year-old returns to Bilbao four years after leaving the Basque outfit for Betis, where he scored 14 goals in 104 La Liga appearances.
A statement published on athletic-club.net read: "Athletic Club and Real Betis have reached an agreement over the transfer of Benat Etxebarria to our organisation."
The deal is due to be ratified with the player this afternoon before he is presented to the press at Bilbao's Ibaigane headquarters on Thursday.
Benat made one league appearance for Athletic in 2006 before spending a season on loan with third division club Conquense.
His first year at Betis, which followed his release by Athletic in 2009, was spent in the reserves but his breakthrough campaign saw him score four goals in 36 matches as the Verdiblancos returned to the top flight in 2011.
Benat's most notable recent contributions to the Andalusian cause were a match-winning brace against local rivals Sevilla in May 2012 and the only goal of 1-0 home victory over Real Madrid last November.
But, after failing to agree a contract extension on a deal expiring in June 2014, Benat was widely expected to leave the Estadio Benito Villamarin this summer.