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2001Complete report (74 KB PDF)
The 2001 survey of corporate medium-term notes (MTNs) incorporates significant revisions of data going back to 1997. The revisions are based on improved procedures for the collection of data, which have enhanced both the coverage and accuracy of the survey. In general, the data revisions have resulted in sizable increases in the measured level of MTNs outstanding and in the gross issuance of MTNs, particularly for financial corporations.
MTNs outstanding at the end of 2001 totaled $479 billion (table 1), up from $446 billion in 2000. The bulk of outstanding MTNs are issued by financial firms, which accounted for $385 billion of the total, up from $349 billion in 2000. MTNs issued by nonfinancial firms have declined steadily since the end of 1999 and totaled $94 billion in 2001.
Outstandings at non-auto finance companies grew rapidly in 2001, to $134 billion. Asset-backed MTNs outstanding rose to $20 billion in 2001, double the level at the end of 2000. Within the nonfinancial sector, issuance among half of the subsectors (electric, gas, and water; manufacturing; transportation, mining, and construction) registered weak growth in 2001. Issuance declined in the other half of the nonfinancial subsectors, especially in the telephone and communications group, where MTNs outstanding fell to $12 billion in 2001 from $15 billion in 2000.
The number of firms with MTNs outstanding has been stable in recent years (table 2). In 2001, the financial firms with MTNs outstanding numbered 176, compared with 285 nonfinancial firms; in dollar terms, however, the bulk of outstanding MTNs is from financial firms.
The vast majority of firms with MTNs outstanding enjoy investment-grade credit ratings. Of the $479 billion in MTNs outstanding at the end of 2001 (table 3), just $13 billion were issued by firms with BB or lower long-term bond ratings (including firms in the "Other" category). The bulk of outstanding investment-grade MTNs were issued by firms with an "A" rating at the end of 2001, although outstanding MTNs issued by these firms fell to $194 billion in 2001 from $248 billion in 2000. The outstanding MTNs issued by firms with BBB, AA, and AAA ratings grew in 2001, a movement reflecting credit rating changes of the issuing firms.
As suggested by the modest rise in outstanding MTNs, issuance activity rose only moderately, to $223 billion in 2001 from $210 billion in 2000 (table 4). Issuance by financial corporations rose to $206 billion in 2001 from $190 billion in 2000, while issuance by nonfinancial corporations declined. The number of firms issuing MTNs declined from 145 firms in 2000 to 122 firms in 2001 (table 5), a decline that was about evenly split between the financial and nonfinancial sectors. In the financial sector, the declines were concentrated among finance companies, while in the nonfinancial sector they were concentrated in the electric, gas, and water grouping. Across the credit rating spectrum, issuance patterns were largely in line with the patterns for outstanding MTNs (table 6).