Gov. George Deukmejian signed legislation that permits...

Gov. George Deukmejian signed legislation that permits foreign-owned California banks to merge with other financial institutions in the state immediately. The measure, which became effective upon signing, had been opposed by big Eastern banks, which complained that it grants foreign institutions an unfair head start in bidding on choice California banks. U.S. banks from outside the Western region cannot buy California banks until 1991. The California Bankers Assn. and officials of foreign banks supported the bill, saying it simply put the foreign-owned California banks on the same footing as other banks in the state and restored powers taken away in a 1986 law.