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October 11, 2000 10:38 AM, EDT

WASHINGTON — Changes to federal banking laws make it much harder for consumer groups to challenge mergers, as opponents to Citigroup’s proposed acquisition of Associates First Capital Corp. are finding out.

While not technically a bank, Associates is one of the nation’s largest suppliers of credit for trucking equipment purchases. It announced its intention to merge into Citigroup in early September ("Citigroup to Buy Associates In $31.1 Billion Stock Deal," 9-11, p. 1).

A major 1999 banking law scrapped a requirement that banks apply to the Federal Reserve to buy non-banking financial companies such as Associates. The central bank’s approval process included a public comment period that sometimes produced high-profile protests that drew the attention of Congress.

The Fed rarely denied a merger based on community lending concerns, but activists used the process to pressure companies to improve their lending records, which sometimes involve multimillion dollar community lending pledges.

For the full story, see the Oct. 9 print edition of Transport Topics. .