WASHINGTON -- Bank of America and FleetBoston Financial Corp. won approval from the Federal Reserve on Monday for a merger creating the third-largest U.S. bank, a behemoth holding nearly $1 trillion in assets and stretching from California through the South and up to New England. The Fed's board of governors voted 6-0 to clear the merger, determining that Bank of America's acquisition of FleetBoston would not threaten competition or unduly concentrate banking resources. The new institution, with about 5,700 branches, would have assets trailing only Citigroup and another planned bank megamerger between Chicago-based Bank One and Wall Street powerhouse J.P. Morgan Chase.


The proposed purchase of FleetBoston -- a deal estimated at $47 billion when announced last October -- has been met with much anxiety in Boston, which would lose its last major hometown bank, and to a lesser extent in communities across the country worried about diminished competition and local control.


The central bank's approval removed the last major regulatory hurdle for the combination, which already had been blessed by the Justice Department and the Federal Trade Commission. The merger also must be approved by shareholders of both banks, allowing it to be completed early next month.


At public hearings held by the Fed in January in Boston and San Francisco, witnesses expressed concerns about predatory lending, possible closing of rural bank branches and the trend toward big banks getting bigger.


Last month, a federal judge in Honolulu -- saying he lacked jurisdiction -- dismissed a lawsuit against the central bank brought by Native Hawaiians seeking to halt the merger. The Fed noted that Bank of America had recently affirmed its intention to complete its goal for mortgage lending to Native Hawaiians.


The banks maintain that the merger will benefit consumers by giving them an expanded choice of ATMs, branches and banking products.


In its merger review, the Federal Reserve also determined that the new bank would fulfill obligations under the Community Reinvestment Act, which requires banks to make loans in low-income and minority areas as a condition for opening new branches.


To address concerns, Charlotte, N.C.-based Bank of America has said it would commit to investing $750 billion in community lending and investment over the next 10 years, including $100 billion in the mid-Atlantic and New England markets served by FleetBoston. FleetBoston says it has made $18 billion in community investments over the past four years -- ahead of its commitments -- though some community activists have questioned that.


The merged bank would have assets estimated at $966 billion.


Bank of America has said some job losses may be expected because of the ``elimination of redundant administrative positions'' -- en route to the projected $1.6 billion the company expects to find in savings -- but that employees who deal directly with customers will be largely unaffected.


FleetBoston, which serves New York as Fleet National Bank, has about 700 back-office workers in the Capital Region, including about 230 at Kiernan Plaza, the former downtown Albany train station that now serves as the Boston bank's upstate headquarters and computer nerve center for the entire company.


Fleet spokesman Karl Felsen said Monday that no decisions have been made yet on those jobs.


Bank of America has 100-year-old roots in California, where it financed Hollywood movies and the Golden Gate Bridge. It was bought by NationsBank, which adopted its name and moved it to North Carolina in 1998.


FleetBoston is the product of a series of mergers, having operated under names including First National Bank of Boston, Baystate Corp., Bank of Boston and, following a 1999 merger with Fleet Bank of Rhode Island, FleetBoston Financial.


Its Albany roots go back to 1803, when New York State Bank, later State Bank of Albany, formed at 69 State St. Through a series of mergers and acquisitions, that bank evolved into Norstar Bancorp in 1982. Six years later, Norstar merged with what was then Fleet Financial Group Inc. of Providence. Business writer Kevin Harlin contributed to this report.