New-York tribune., 1921-12-03
City to Sell
$55,OOO,OOO
5O-Year Stock
First Lohg-Term Financing
i'm 4 Years Will Take Care
of a Considerable Part
of Floating Indebtedness
Good Reception Expected
New Offering to Bear az
Per Cent; Bonds Are
Now Selling on This Basis

City Comptroller Charles l.. Craig
announced late yesterday that arrange
ments had been completed by the
Finance Department for the public sale
of S55, 900. 900 of fifty-year 41a per cent
corporate stock of the City Of New
York. bids for which will be opened at
the Comptroler's office at noon on
Thursday. December 15 In addition to
the amount to be offered publicly, there
will be purchased by the municipal au-
thorities for the various sinking FUNDS
and pension funds corporate stock and
serial bonds to the extent OF about
$50, 900, 900 more, making the aggregate
of the new issue approximately $780,
100000.
The sale does not involve raising
any new money, but is in the nature Of
a refunding operation which Will take
I'D considerable part Of the city S
floating Indebtedness now outstanding
in the form Of short-term paper. This
is the first long-term financing the city
has undertaken since the summer OF
1917 and marks an important change
in the financial policy of the Hyian ad-
mnistration, which for more than four
years has been obtaining the funds
needed in financing the city's require
paper. Last week it was reported in
Wall Street that Comptroller Craig
planned to bring out new issue OF
$50 900 900 of four to six months paper
on q discount basis, but it is under
stood that recent changes in the in
vestment market situation caused HIM
to change his program in favor Of long
term financing. The Comptroller's Of
fee was in consultation yesterday with
several Wall Street bankers relative to
it's financing plans, and the bankers are
said to have recommended the lmme-
date sale of long-term bonds.
Comptroller Craig in formal state
ment announcing his program said: "In
1918, in order to avoid having the City
of New York selling its long-term
bonds in competition with the Federal
government in it's efforts to finance war
activities, Comptroller Craig obtained
authority from the Legislature to carry
the city through the war on short term
obligations. After the war was over
conditions were not propitious for q
long term bond sale by the city because
various foreign governments were in
this market for money. paying as high
as per cent and selling their bonds
at discount, and there was an urgent
demand for money from all quarters,
the result being that interest rates
were unduly high. The Comptroller,
therefore. determined to defer a sale
of New York City's obligations until
such time as couditions were more
rropitious. Within the last few days
the bond market has reached a Az per
cent level. The money market has i'm
proved in many directions in the last
few weeks. The Comptroller is able to
borrow money now for short term pur
poses at materially lower rates than
heretofore prevailed. and he enter
tains no doubt that the public offering
of $55 900 900 will be well taken.
"The bonds that are now being sold
to the public, as we'll as others taken
for the various sinking funds, are for
lefunding short-term obligations is
sued by the Comptroller during the
war. No new money is being borrowed,
and these sales do not in any particu-
lar increase the city's debt 1t merely
changes the form of the citys obliga-
tions from a short-term note to long
term bonds"
New Yors City's Az per cent bonds
have been extremely strong in Wall
Street this week. and have sold we'll
above par, to yield less than Az per
cent. The last sale of long-term bonds
OH behalf of the city was made in July,
1917 when syndicate consisting of J.
P. Morgan & Co.. the First National
Bank, the National City Company, the
Guaranty Trust Company, the Bankers
Trust Company, Brown Bros & Co. and
Harris, Forbes e. Co. took the entire
offering OF 55,00o,0O0 of Az per cent
corporate stock, due in 1907, on a bid
of 100.6507. Total bids received by
Comptroller Prendergast, who was then
in charge Of the city's finances, amount
cd to S1o3 3,S65,830. The syndicate later
resold the issue at price of 1OlM to
yield about 4.z2 per cent.