The Federal Reserve Board has granted employees of a section 20 unit permission to also work for an affiliated insurance agency.

In a May 15 letter to SouthTrust Corp., the Fed said SouthTrust Securities Inc. may enter into a dual employee arrangement with SouthTrust Insurance Agency and SouthTrust Bank.

Under a dual employee arrangement, workers sell both securities and insurance products and salaries are paid by both affiliates.

The Office of the Comptroller of the Currency has long let bank employees also work for insurance agency subsidiaries. But this is the first time the Fed has confirmed that employees of section 20 units may also work for an insurance agency subsidiary of the holding company, said Brian W. Smith, a partner in the Washington office of the Mayer, Brown & Platt law firm.

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