About a dozen other American banks have securities affiliates that handle bonds.

For most individual investors, the new powers for banks' securities affiliates are not expected to be noticeable.

Chemical and First Chicago have also said their securities affiliates intended to apply for authority to deal in corporate bonds.

And I have a problem with their plan to allow banks to lend money to their securities affiliates.

The securities affiliates must operate with separate management and capital to protect the rest of the bank from the risks of stock trading.

Facts: Company X gets a bank's securities affiliate to underwrite its new issue of shares.

Conflict: To avoid suffering a loss the bank induces the customer to use its securities affiliate to make a new share issue.

Glass opposed direct bank involvement in these activities and indirect involvement through "securities affiliates."

Glass also revised his bill to extend the deadline for banks to dispose of securities affiliates from three to five years.

This will primarily take the form of Congress mandating strong "firewalls" between commercial banks and their securities affiliates.