Building on a reorganization of its U.S. operations launched a year ago, Germany's Dresdner Bank AG is boosting the capital of its New York- based securities unit, Dresdner Securities (USA) Inc. to $241 million from $41 million. Half the extra capital will be equity and half subordinated debt, the bank said.

George Fugelsang, North American chief executive for Dresdner, said the capital increase was "a key part of our strategy to expand Dresdner's activities in the U.S. market." He added that the new capital will be used to support a broader range of market activities, primarily treasury and trading operations.

Dresdner, Germany's second-biggest bank after Deutsche Bank, runs both commercial and investment banking operations in the United States. The investment banking operations were set up before the International Banking Act was approved in 1978 and are therefore grandfathered under U.S. law.

The bank has more than $10 billion in assets in the United States and last year reorganized its activities here, setting up a holding company for the bank's U.S., Mexican, and Canadian operating units. As part of the reorganization, the bank took full control of its U.S. securities unit by buying out a 25% stake held by Bayerische Hypotheken und Wechsel Bank.

Dresdner is the third foreign bank to recently expand securities and capital markets operations in the United States.

Last week, Spain's biggest bank, Banco Santander, obtained authorization from the Federal Reserve System under section 20 of the Bank Holding Company Act to underwrite and deal in all types of debt and equity securities.

The added activities will be conducted through Santander Investment Securities Inc., a New York-based investment banking unit.

The Spanish bank is the fourth foreign institution to obtain full- fledged underwriting powers under section 20. The three others are Deutsche Bank, ABN-Amro NV, and Swiss Bank Corp.

Santander said it will initially use the unit to underwrite, sell, trade, and privately place emerging-market equity and fixed-income debt with institutional investors. The bank also plans to sell Spanish and Portuguese securities to U.S. investors.

Meanwhile, Deutsche Bank's U.S. unit will open a securities sales and trading office in Boston, the bank said.

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