A bad case of sibling rivalry

When BankAmerica and NationsBank announced a $90 billion merger last month, the hi-tech investment bankers at BankAmerica Robertson Stephens knew their days were numbered. "It's us or them," a Robertson banker groused to a competitor, referring to rival San Francisco boutique Montgomery Securities, which NationsBank purchased last summer. But there was little doubt Robertson would lose out to Montgomery. What's more, the same thing had happened 20 years earlier.

Within a week BankAmerica announced it would sell Robertson, which it had bought for $540 million less than a year before. Sources close to BankAmerica say there are several potential buyers, but competitors say the hi-tech IPO business has been static this year. They think BankAmerica may have to settle for much less than it paid, particularly given Robertson's 1997 performance.

With a fresh wave of mergers engulfing banking, it may seem odd that some deals are already fragmenting. In this...