The merger of Wells Fargo & Co. and Norwest Corp. enters its final stage this week as the combined $205.4 billion-asset company begins the lengthy process of unifying computer systems and customer accounts.

It could take as long as 18 months -- until the first quarter of 2001 -- to meld operations across 21 states. As a first step, the new Wells Fargo on Thursday will begin converting its 94 branches in New Mexico, all but five of which are former Norwest locations.

"Once we're done in New Mexico, our customers there will be able to use any store in that market to do their banking," Wells Fargo chief operating officer Leslie S. Biller said in an interview.

Accounts and computer systems at the New Mexico branches will be converted by the end of this month; Norwest signs are expected to be replaced with Wells Fargo ones by mid-October, he said.

Nevada, where Wells Fargo has 121 branches, will be converted by the end of October. By that time, new computer hardware will be in place in Wells Fargo's 260 Arizona branches, Mr. Biller said. But from Nov. 1 through mid-March, conversions will grind to a halt so the bank can focus on any year-2000 problems that crop up.

The Arizona conversion will be completed by the end of March, followed by "one or two states a month, although the precise schedule is still tentative," a Wells Fargo spokesman said.

The deliberate pace of this massive conversion contrasts sharply with the former Wells Fargo's headlong drive in 1996 to absorb First Interstate Bancorp within six months of buying it. Resulting system failures drove away thousands of customers and yielded significant operating losses. The botched integration became a case study in how not to do a bank merger.

"Relatively minor mistakes have a way of significantly impacting an integration when you try to do it all at once," said James R. Bradshaw, an analyst with Pacific Crest Securities of Portland, Ore.

However, from the day the merger deal was announced last year, Wells Fargo has stressed that it learned from its mistakes. For the most part, the analyst community seems convinced that the banking company, led in large part by former Norwest executives, will not repeat the First Interstate debacle.

"With this big mistake behind them, the slow pace, and the fact that there aren't a lot of duplicative systems in this case, we're pretty confident this won't be too risky," Mr. Bradshaw said.

To prepare customers, Wells Fargo has been mailing customized letters outlining the new products and services that will be available to recipients because of the merger, Mr. Biller said.

"Based on the products each household has, we're able to say in a very customized way, 'Here are the things that will affect you and your relationship,' " he said.

Former Norwest customers will see the biggest changes in the branches, and not just because the brand name of the former Minneapolis-based banking company will disappear. The technology used in the branch network will be a combination of Norwest and Wells Fargo computer systems. While the merged company will rely on the former Norwest's backroom processing, tellers and salespeople will use the former Wells Fargo's customer information software.

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