The Federal Reserve approved Wells Fargo & Co.'s $12.2 billion takeover of Wachovia Corp., clearing one of the last obstacles for creation of the largest U.S. bank-branch network.
The central bank's Board of Governors unanimously approved the merger Sunday, the Fed said in a statement in Washington. The order requires San Francisco-based Wells Fargo, which topped a competing bid from Citigroup Inc., to wait five days before completing the acquisition.
The Fed's unusual Sunday decision, coming amid the worst financial-market turmoil in seven decades, follows accelerated efforts by other regulators to clear the takeover of Wachovia, which faced bankruptcy last month. Two days ago, the Federal Trade Commission granted antitrust clearance and the New York Stock Exchange allowed Wachovia to skip a shareholder vote.
The Fed shortened the approval process because of the market disruptions and “the weakened financial condition of Wachovia,” the statement said. The bank sought to omit the shareholder vote tied to the deal because any delay “would seriously jeopardize the financial viability of Wachovia,” according to an Oct. 10 statement.
Wells Fargo's acquisition of Wachovia gives the company more branches than any U.S. bank and would rival Bank of America Corp. for the most deposits. The combined company would hold $787 billion collected from about 48 million customers, according to an Oct. 3 statement.
The purchase includes Wachovia's U.S. securities brokerage and the Evergreen mutual fund unit with more than $250 billion in assets.
The Fed said it will release another statement detailing the “commitments and conditions” for the approval.