The Federal Reserve Board on Monday approved the merger of NationsBank Corp. and BankAmerica Corp., clearing the way for the creation of the country's first coast-to-coast bank.
Shareholders at both banks are expected to vote Sept. 24 on the $60 billion deal, which would create a $580 billion-asset banking company with 4,800 branches and 14,000 automated teller machines. The Fed said the combined bank will operate in 26 states. Assuming shareholder approval, the banks would officially combine on Sept. 30, a NationsBank spokesman said.
The Fed, in an 89-page order, is requiring BankAmerica, as the combined company will be known, to report semiannually over the next two years any branch closings that result from the merger. These reports must include steps the bank took to mitigate harm to the community and the distance to the nearest surviving branch.
"We are gratified that the Federal Reserve has acted promptly on the application and we look forward to merging these two companies into the nation's leading bank and creating value for all our constituencies," the NationsBank spokesman said.
The Fed received more than 1,600 comments on the deal. In rejecting Community Reinvestment Act protests, the Fed noted that both banking companies operate extensive community development programs and have "outstanding" CRA ratings.
The Justice Department dropped antitrust objections to the deal Friday after the banks agreed to divest 17 branches in New Mexico with $492 million of deposits.