Eliminating the final regulatory hurdle to creation of the country's largest bank, the New York State Banking Department gave Chemical Banking Corp. permission Thursday to acquire Chase Manhattan Corp.

Also on Thursday, the Office of the Comptroller of the Currency gave Chase an "outstanding" Community Reinvestment Act rating. The score, an improvement from the "satisfactory" Chase got in 1993, came just days after community activists criticized the Federal Reserve Board for approving the deal before the Comptroller's office had completed its exam.

The merger will create a $300 billion bank operating 1,000 offices and employing 75,000 people. The new bank, which will take the Chase Manhattan name, surpasses Citicorp for top billing.

The Fed, the Justice Department, and the Delaware Banking Department had already approved the deal. Chemical spokesman Ken Herz said the banks expect to consummate the merger by the end of first quarter.

The new Chase will dominate consumer banking in New York and be a national leader in global loan syndications, the Clearing House Interbank Payments System, and Fed Wire.

Community activists had hoped regulators would require the combined bank to bulk up its $18 billion community reinvestment commitment.

"I'm disappointed the Fed and the New York State Banking Department didn't delve deeper into the community groups' concerns, because this is the megamerger of megamergers," said Sarah Ludwig, director of the Neighborhood Economic Development Advocacy Project in New York.

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