For immediate release

The Federal Reserve Board today announced its approval of the application of NationsBank Corporation and NB Holdings Corporation, both of Charlotte, North Carolina, to retain, in a fiduciary capacity with sole voting authority, more than 5 percent, but less than 25 percent, of the voting shares of First National Security Company, De Queen, Arkansas; Calvin B. Taylor Bankshares, Inc., Berlin, Maryland; First Perry Bancorp, Inc., Pinckneyville, Illinois; and The First National Bank in Falfurrias, Falfurrias, Texas. Attached is the Board's Order relating to this action.

NationsBank Corporation Charlotte, North Carolina NB Holdings Corporation Charlotte, North Carolina Order Approving the Ownership of Bank Shares In a Fiduciary Capacity

NationsBank Corporation and NB Holdings Corporation, both of Charlotte, North Carolina (collectively, "NationsBank"), bank holding companies within the meaning of the Bank Holding Company Act ("BHC Act"), have requested the Board's approval under section 3 of the BHC Act (12 U.S.C. § 1842) to retain, in a fiduciary capacity with sole voting authority, more than 5 percent, but less than 25 percent, of the voting shares of First National Security Company, De Queen, Arkansas; Calvin B. Taylor Bankshares, Inc., Berlin, Maryland; First Perry Bancorp, Inc., Pinckneyville, Illinois; and The First National Bank in Falfurrias, Falfurrias, Texas (collectively, the "Banks").1 The voting shares of the Banks are held by the trust departments of two NationsBank subsidiary banks, NationsBank, N.A., Charlotte, North Carolina, and NationsBank of Texas, N.A., Dallas, Texas, and were acquired in connection with previous acquisitions by NationsBank.2 Notice of the proposal, affording interested persons an opportunity to submit comments, has been published (62 Federal Register 7,784 (1997)). The time for filing comments has expired, and the Board has considered the applications and all comments received in light of the factors set forth in the BHC Act. NationsBank, with total consolidated assets of approximately $226 billion, is the fourth largest commercial banking organization in the United States, controlling approximately 5.5 percent of total banking assets of insured commercial banks ("total banking assets").3 Its subsidiary banks operate in North Carolina, Arkansas, Delaware, the District of Columbia, Florida, Georgia, Illinois, Iowa, Kansas, Kentucky, Maryland, New Mexico, Oklahoma, South Carolina, Tennessee, Texas, and Virginia. State deposit and ranking data in light of the proposal are contained in Appendix A. NationsBank holds the shares of the Banks in a fiduciary capacity as trustee for predominately family trusts. NationsBank did not acquire or express an interest in acquiring any shares of the Banks on its own behalf, but instead, NationsBank received shares that had been purchased and placed in trust by the grantors. The trusts were only acquired by NationsBank in connection with the acquisition of the banking organization that was serving as trustee when it was acquired. In almost every case, the trusts were established by current or former officers or directors of the Banks. NationsBank eventually will be required to distribute the trusts' assets, over which it temporarily holds legal title, to the descendants of the current beneficiaries of the trusts. There are no director or officer interlocks between NationsBank and Banks.4 Based on these facts and all other facts of record, including commitments made by Nationsbank in connection with this proposal, it is the Board's judgment that, for purposes of the BHC Act, NationsBank's retention of less than 25 percent of the voting shares of the Banks would not result in control of the Banks by NationsBank. Competitive Considerations In reviewing the competitive aspects of the proposal, the Board notes that NationsBank controls a relatively small percentage of the voting shares of the Banks. The Board has, nevertheless, considered this proposal on the basis that NationsBank would have the ability to alter the market behavior of Banks in an anticompetitive manner. NationsBank and the Banks compete directly in the following banking markets: Scott County, Arkansas ("Scott County"); Eastern Shore and Worcester County ("Worcester County"), Maryland; and McCurtain County, Oklahoma.5 Consummation of the proposal would exceed the threshold levels of market concentration, as measured by the Herfindahl-Hirschman Index ("HHI"), in the Scott County and Worcester County banking markets.6 A number of considerations indicate that the market concentrations as measured by the HHI tend to overstate the competitive effects of this proposal in Scott County and Worcester County. In Scott County, for example, where NationsBank and First National Security Company ("First Security") compete, the largest principal shareholders of the banking organization and grantors of the trust holding First Security shares that are administered by NationsBank, control more than 72 percent of First Security's the voting shares. The shareholders also serve as officers of First Security. In Worcester County, ten competitors, including three of the largest commercial banking organizations in the Maryland, would remain and the banking market has characteristics that make it attractive for entry and expansion by potential competitors.7 Based on these and other facts of record, including the fiduciary nature of NationsBank's interest and its commitments to remain a passive shareholder, the Board concludes that the proposal would not have a significantly adverse effect on competition or concentration of banking resources in the Scott County or Worcester County banking markets, or any relevant banking market. Accordingly, the Board concludes that competitive considerations are consistent with approval of the proposal. Supervisory Factors In light of all the facts of record, including supervisory reports of examination, the Board also concluded that the financial and managerial resources and future prospects of the institutions involved in this proposal, and considerations relating to the convenience and needs of the communities to be served, are consistent with approval, as are the other supervisory factors the Board must consider under section 3 of the BHC Act. Conclusion Based on the foregoing and all the facts of record, the Board has determined that the application should be, and hereby is, approved. The Board's approval of the proposal is conditioned on compliance by NationsBank with the commitments made in connection with this application, including the commitments referred to in the order and contained in Appendix B. The commitments and conditions relied on by the Board in reaching this decision shall be deemed to be conditions imposed in writing by the Board in connection with its findings and decision, and, as such, may be enforced in proceedings under applicable law.

By order of the Board of Governors,8 effective May 12, 1997. (signed) Jennifer J. Johnson Jennifer J. Johnson Deputy Secretary of the Board

Appendix A State deposit and ranking data if NationsBank were considered to control the Banks.9 Arkansas. NationsBank would be the largest commercial banking organization, controlling deposits of $3.5 billion, representing 13.1 percent of the total deposits in commercial banking organizations in the state. Maryland. NationsBank would be the largest commercial banking organization, controlling deposits of $9.6 billion, representing 23.9 percent of the total deposits in commercial banking organizations in the state. Illinois. NationsBank would be the 17th largest commercial banking organization, controlling deposits of approximately $1 billion, representing less than 1 percent of the total deposits in commercial banking organizations in the state. Oklahoma. NationsBank would be the largest commercial banking organization, controlling deposits of $3.1 billion, representing 10.6 percent of the total deposits in commercial banking organizations in the state. Texas. NationsBank would be the largest commercial banking organization, controlling deposits of $25.6 billion, representing 16.6 percent of the total deposits in commercial banking organizations in the state. Local banking markets where NationsBank and the Banks compete: (1) Scott County, Arkansas banking market -- approximated by Scott County, Arkansas. (2) Eastern Shore, Maryland banking market -- approximated by Accomack County and Northampton County Virginia; and the towns of Pocomoke City and Snow Hill, Maryland. The HHI would increase 66 points to 1480. (3) Worcester County, Maryland banking market -- approximated by Worcester County, Maryland. (4) McCurtain County, Oklahoma banking market -- approximated by McCurtain County, Oklahoma. The HHI would increase 179 points to 1865.

Footnotes 1 NationsBank would retain not more than the following percentages of voting shares of the Banks: (1) 15.6 percent of First National Security Company; (2) 8 percent of Calvin B. Taylor Bankshares; (3) 13.1 percent of First Perry Bancorp; and (4) 15.5 percent of The First National Bank in Falfurrias. 2 The interests were acquired in connection with NationsBank's acquisition of MNC Financial, Inc., Baltimore, Maryland, and as successor to two failed institutions, First Republic Bank Midland, N.A., Midland, and NBC Bank-San Antonio, N.A. San Antonio, both in Texas. 3 Consolidated asset data are as of December 31, 1996, and include the acquisition of Boatmen's Bancshares, Inc., St. Louis, Missouri. 4 NationsBank also has made a number of commitments that are similar to commitments previously relied on by the Board to determine that an investing bank holding company would not exercise a controlling influence over another bank holding company or bank for purposes of the BHC Act. See, e.g., North Fork Bancorporation, Inc., 81 Federal Reserve Bulletin 734 (1995) (acquisition of 19.9 percent of the voting shares of a bank holding company); Mansura Bancshares, Inc., 79 Federal Reserve Bulletin 37 (1993) (acquisition of 9.7 percent of the voting shares of a bank holding company); and SunTrust Banks, Inc., 76 Federal Reserve Bulletin 542 (1990) (acquisition of up to 24.99 percent of the voting shares of a bank). NationsBank has committed, for example, except to the extent required in its capacity as a fiduciary, not to exercise or attempt to exercise a controlling influence over the management or policies of the Banks; not to seek or accept representation on the board of directors of the Banks; not to challenge a nominee of management for the board of directors of the Banks; and not to have any representative of NationsBank serve as an officer, agent or employee of the Banks or any of their affiliates. The Board concludes that these commitments adequately limit NationsBank's ability to weaken or eliminate independent action by the Banks. 5 The banking markets are described in Appendix A. 6 The HHI would increase 844 points to 5141 in Scott County, and 299 points to 2045 in Worcester County. The increases in the HHI for the remaining banking markets are contained in Appendix A. Under the revised Department of Justice Merger Guidelines, 49 Federal Register 26,823 (June 29, 1984), a market in which the post-merger HHI is over 1800 is considered to be highly concentrated. The Department of Justice ("DOJ") has informed the Board that a bank merger or acquisition generally will not be challenged (in the absence of other factors indicating anticompetitive effects) unless the post-merger HHI is at least 1800 and the merger increases the HHI by more than 200 points. The DOJ has stated that the higher than normal HHI thresholds for screening bank mergers for anticompetitive effects implicitly recognize the competitive effect of limited-purpose lenders and other non-depository financial entities. 7 From 1990 to 1995, the population in Worcester County increased by 15.1 percent whereas the average increase in population statewide was 6.1 percent. In the last five years, deposits in Worcester County increased by 1 percent whereas the average increase in deposits for non-Metropolitan Statistical Area counties in the state like Worcester County was approximately 0.01 percent. 8 Voting for this action: Vice Chair Rivlin, and Governors Kelley, Phillips, and Meyer. Absent and not voting: Chairman Greenspan. 9 State deposit data are as of June 30, 1996.

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1997 Orders on banking applications