The Federal Reserve Board late Monday said it approved First Chicago NBD Corp.'s application to underwrite and deal in stocks.

First Chicago, which applied in June, joins about 20 other banking companies with equity powers. It will house the new business in its section 20 unit, First Chicago Capital Markets.

The bank plans to use the powers to enhance its junk bond effort by underwriting equity warrants attached to high-yield bonds, a spokesman said. He added that First Chicago would continue to rely on Robert W. Baird & Co., a Milwaukee securities firm, for some of its equity needs.

Earlier this year, First Chicago entered an alliance with Baird to offer its clients Baird's merger and acquisitions advisory and equity distribution services.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.