The Federal Reserve Board gave Mitsubishi Bank permission Friday to acquire the Bank of Tokyo's affiliates in this country, removing the last U.S. hurdle to creation of the world's largest bank.

The order allows the Tokyo-based Mitsubishi to combine Bank of California and Union Bank. The new San Francisco-based institution - to be renamed Union Bank of California - will be the third-largest commercial bank in the state, with $25 billion in assets.

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