The Federal Reserve Board gave Banc One Corp. permission Monday to underwrite commercial securities though its section 20 subsidiary.

Banc One Capital Corp. previously could only underwrite and sell municipal revenue and general obligation bonds. The Fed's order allows the subsidiary to move beyond these so-called Tier 1 powers and offer Tier 2 services.

The Fed did impose a condition. It said the bank must present to the board a plan explaining how it will comply with the numerous Fed rules regarding section 20 units.

This includes a rule that limits to 25% the amount of revenue a section 20 unit may earn underwriting commercial securities.

"On notification by the board that this condition has been satisfied, company many commence proposed underwriting and dealing activities in equity securities," the Fed said.

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