Federal Reserve Statistical Release, Corporate Medium-Term Notes; title with eagle logo links to Statistical Release home page

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1999 complete report (26 KB PDF) | Tables (18 KB PDF)

U.S. corporations issued $135 billion of medium-term notes (MTNs) in 1999, down $15 billion from the 1998 total of $150 billion (table 1.A). Issuance by financial firms fell to $121 billion in 1999, a decline of $8 billion, while nonfinancial firms issued $14 billion, a $7 billion decline from 1998. A total of 96 firms sold MTNs in 1999, down from 145 in 1998 (table 1.B), though the number of firms with MTNs outstanding rose to 451 in 1999 (table 2.B). Year-end MTNs outstanding rose $37 billion in 1999, to $416 billion (tables 2.A and 3). The increase was largely accounted for by the $28 billion rise in outstandings at financial firms, to nearly $330 billion. Outstandings for nonfinancial firms increased $9 billion, to $90 billion, after the previous year's gain of $6 billion.

Borrowers in the corporate MTN market continue to have predominantly investment-grade ratings. As in 1998, roughly 99 percent of total MTN issuance had a rating of Baa or better (table 5.A). Issuance by single-A-rated issuers accounted for 62 percent of total gross issuance, up from 58 percent in 1998. AA rated issuance declined to 20 percent, from 25 percent in 1998. Three issuers had a speculative-grade credit rating last year (table 5.B).

The MTN market accounts for a sizable share of intermediate and long-term borrowing by U.S. companies. One measure of the MTN market share is the volume of MTN issuance as a percent of total public issuance of investment-grade debt (MTNs plus corporate bonds). For all U.S. corporations, this measure of share was 41 percent in 1999 (table 7); for financial firms, it was 57 percent; and for nonfinancial firms, it was 12 percent. For all firms, this share fell slightly from 1998. Similarly, the ratio of outstanding MTN debt as a share of total corporate outstanding debt (MTNs plus corporate bonds) declined slightly over the year, from 15 percent to 14 percent (table 8).

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