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It seems securities regulators from Missouri, and a handful of other states, still want

Merrill Lynch


to show them why the brokerage's $100 million settlement with New York's attorney general is a good deal.

Missouri is one of a handful of states that has yet to sign onto the deal, which effectively ended New York's high-profile investigation into potential conflicts of interest between research analysts and investment bankers at the nation's biggest brokerage firm.

So far, about 43 states have given their approval to the deal, which entitles any participating state to share in the $100 million fine Merrill is scheduled to pay to New York later this year. The deal between Merrill and New York was announced on May 21.

Sources say the main holdouts are Missouri, South Dakota, New Jersey and Ohio. But people familiar with the negotiations expect most states to approve the settlement, with the possible exception of Missouri and South Dakota -- where securities regulators have raised the most questions about the deal.

Some have feared Merrill might renege on the settlement -- if a sizeable number of states rejected the plan -- because that might expose the firm to a series of endless investigations. But it appears Merrill intends to honor its agreement under the deal, even if not all 50 states, as well as the District of Columbia and Puerto Rico, ultimately sign on.

"I think it is to

Merrill's advantage to go along," says Joe Borg, president of the North American Securities Administrators Association and Alabama's director of securities. "I don't think it will break it, if Missouri and South Dakota doesn't join."

William Halldin, a Merrill spokesman, wouldn't comment on the prospect of several states rejecting the deal. But he notes Merrill already has begun instituting most of the provisions of the settlement, which would restrict investment bankers from evaluating the performances of stock analysts and making recommendations about how analysts should be compensated.

A spokesman for New York Attorney General Eliot Spitzer says he expects no more than two or three states to refuse to join the pact.

Missouri regulators declined to comment about their reservations. But sources say the Missouri officials remain concerned that none of the money in the settlement will go to investors. If Missouri doesn't go along with the pact, it could decide to pursue its own investigation against Merrill.

The settlement calls for New York to receive up to $48 million, with the other states splitting the rest.

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Meanwhile, state regulators are moving ahead with their investigations of similar analyst conflicts at other Wall Street firms, including

Credit Suisse First Boston


Goldman Sachs

(GS) - Get Goldman Sachs Group, Inc. (GS) Report


Lehman Brothers



Morgan Stanley




(C) - Get Citigroup Inc. Report

. The investigation into analyst conflicts of interest at CSFB, which is being led by Massachusetts' securities regulators, is said to be the furthest along.