Security Pacific applied to create a subsidiary.

If approved by the Federal Reserve Board, the subsidiary would underwrite and deal in municipal revenue securities, mortgage-related securities, consumer receivable-related securities and commercial paper. It would also house Security Pacific’s existing primary dealer, municipal securities and mortgage trading and finance activities. Security joined three other U.S. banking firms--New York’s Citicorp, J. P. Morgan & Co. and Bankers Trust New York--in asking the Fed to approve broad investment banking authority. The Fed has set a Feb. 3 hearing in Washington on the question.