Central Bank Oks Nationsbank Deal

NationsBank Corp.’s aspiration to become a major player in investment banking by acquiring Montgomery Securities won approval Wednesday from the Federal Reserve Board.

The board voted 4-0 to permit the $1.2 billion purchase of the San Francisco-based securities firm by the country’s fourth-largest bank holding company, despite protests by two consumer groups.

Inner City Press/Community on the Move of Bronx, N.Y., and the New Mexico Alliance had cited allegations NationsBank discriminated against minority employment applicants, had conducted investment sales improperly and had raised fees, reduced services and closed branches in New Mexico after it acquired Boatmen’s Bancshares in December.

But, in its order, the Federal Reserve Board said it found “no evidence (the merger) … would likely result in any significantly adverse affects, such as undue concentration of resources, decreased or unfair competition, conflicts of interests, or unsound banking practices that would outweigh the public benefits of the proposal.”