The Supreme Court on Monday let stand a decision allowing NationsBank Corp. to combine some of its Texas and New Mexico operations.
Without comment, the justices turned down an appeal by Texas Banking Commissioner Catherine A. Ghiglieri, who had sought to kill the deal because Texas does not permit interstate branching.
The federal appeals court in New Orleans ruled in July that the Office of the Comptroller of the Currency may allow NationsBank to use the so- called 30-mile rule to move its Sun World subsidiary from El Paso to Santa Teresa, N.M., without relinquishing its Texas branches. Merger of the Sun World operations is a critical step for NationsBank to eventually combine all of its Texas units into its Charlotte, N.C.-based bank.
"We are gratified that the case is concluded and pleased that the court of appeals decision was upheld," said Julie L. Williams, the comptroller's chief counsel. "We thought the appeals court decision was a well-reasoned approach to our branching decisions."
The so-called 30-mile rule was a powerful tool banks used to branch across state lines before interstate branching became legal in June 1997. It allowed banks to move their headquarters 30 miles, including into a neighboring state, and retain all existing branches.