First Chicago NBD Corp. on Wednesday asked the Federal Reserve Board for permission to underwrite and deal in equities, joining a growing list of banks eager to participate more fully in the securities business.

If its application is approved, First Chicago would become one of about 20 banking companies authorized to underwrite and deal in stocks. It would house the equity business in its section 20 subsidiary, First Chicago Capital Markets Inc.

F. Gerald Byrne, chairman of First Chicago Capital Markets, said the bank has no intention of building a full-service equity business. Instead, it plans to use equity powers to enhance its junk bond effort by underwriting equity warrants attached to high-yield bonds.

"We have been precluded from participating in several high-yield underwritings that contained warrants because we did not have equity capabilities," Mr. Byrne said.

Warrants allow their holders to buy stock at a specific price.

Earlier this year, First Chicago entered an alliance with Robert W. Baird & Co., a Milwaukee securities firm, to offer its clients merger and acquisition advisory services, as well as equity distribution services.

Mr. Byrne said equity powers would supplement, not replace, that relationship. Baird would still handle the equity or warrant portions of the high-yield bonds First Chicago underwrites, but First Chicago would be able to participate in the deal.

A First Chicago spokesman explained that some of its customers would prefer that arrangement. Many clients want the bank to fully service their high-yield deals, rather than pass along the equity portion to Baird, he added.

Michael Ancell, a financial services analyst with Edward Jones in St. Louis, said that has long been a source of frustration for First Chicago's senior management.

"The concern was that they needed to do what their customers wanted them to do," he said. Banks realize that "they're leaving the customer's money on the table when they send the customer to Wall Street" for equity portions of deals, he added.

But First Chicago's plan to get equity powers may cause some tension in the bank's relationship with Baird, Mr. Ancell warned. Such relationships tend to be difficult because they mix two very different banking cultures.

"They'll have to sort it out," he said.

First Chicago Capital Markets was established in 1988 and already has authority to underwrite and distribute government securities, municipal bonds, commercial paper, asset-backed securities, and corporate debt.

Recent loosening of the rules that restrict commercial banks from selling securities has nudged several banks to expand their section 20 units.

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