Citibank yesterday issued $2.18 billion of certificates backed for the first time by receivables of its Choice credit cards.

"It's another brand of Master-Card and Visa, and it's offered to very creditworthy customers," a Citibank spokeswoman said. "It was designed for customers with exceptional credit histories."

Citibank developed the Choice cards in the mid-1980s, she said.

Choice Credit Card Master Trust Series 1992-1 and 1992-2 each had senior and subordinated tranches, the spokeswoman said.

The 1992-1 senior piece consisted of $1 billion of two-year Class A floating-rate certificates priced at 99.92417 to yield 18.75 basis points over the three-month London interbank offered rate. The coupon was 3.7750%, she said.

Citicorp Securities Markets Inc. was lead manager with Salomon Brothers as co-lead manager.

The 1992-2 senior piece consisted of $1 billion Class A of five-year floating-rate securities priced at 99.90706 to yield 32 basis points over the three-month Libor. The coupon was 3.925%.

Salomon was lead manager, with Citibank as co-lead manager.

One investment banking source said the two-year senior piece came tighter that expected, while the five-year piece was "right on target."

J.P. Morgan Securities Inc. served as lead manager on the subordinated classes.

The Series 1992-1 subordinated class consisted of $78.2 million Class B certificates priced at 99 27/32 to yield 5.731 Treasuries. points over two-year Treasuries. The coupon was 5.65%.

The Series 1992-2 subordinated class consisted of $102 million Class B certificates priced at 99 28/32 to yield 7.223% or 123 basis points over five-year Treasuries. The coupon was 7.20%.

Moody's Investors Service and Standard & Poor's Corp. rate both of the senior pieces triple-A. The subordinated pieces were rated A2 by Moody's and A by Standard & Poor's, the spokeswoman said.

In other news, the Kroger Co. yesterday announced plans to redeem the rest of its 13 1/8% subordinated debentures due 2001. The debentures are scheduled to be redeemed on Jan. 15 at 107.50% plus accrued interest, a Kroger release says. The approximately $94 million of remaining debentures were part of a $625 million offering priced in January 1989.

Kroger also plans a partial redemption of its 12 7/8% senior subordinated debentures due 1999. The Cincinnati-based company will call $25 million of the bonds on Jan. 15 at 106.425% plus accrued interest. Following the partial redemption, about $160 million of the original $625 million issue will remain outstanding.

In secondary trading yesterday, spreads on high-grade corporate bonds ended unchanged in quiet activity. Junk bonds also finished unchanged.

New Issues

New England Telephone & Telegraph Co. issued $175 million of 6.250% notes due 1997. The non-callable notes were priced at 99.291 to yield 6.418% or 40 basis points over five-year Treasuries. First Boston Corp. lead-managed the offering.

Southern California Gas issued $125 million of 6.5% first mortgage bonds due 1997. The noncallable bonds were priced at 99.94 to yield 6.514% or 50 basis points over comparable Treasuries. Moody's rates the offering A2, while Standard & Poor's rates it A-plus. First Boston Corp. won competitive bidding to underwrite the offering.

Integrated Health Services issued $100 million of convertible subordinated debentures due 2003. The debentures are convertible into common stock at $32.125, a 22.4% conversion premium. Moody's rates the offering B2, while Standard & Poor's rates it B-minus. The offering was increased from $50 million. Smith Barney, Harris Upham & Co. lead-managed the offering.

Alcan Corp. issued $100 million of 7.250% guaranteed debentures due 1999. The noncallable debentures were priced at 99.513 to yield 7.34% or 95 basis points over comparable Treasuries. Moody's rates the offering A2, while Standard & Poor's rates it A-minus. First Boston lead managed the offering.

Federal Home Loan Mortgage Corp. issued $100 million of 6.250% notes due 1997 at par. Noncallable for three years, the notes were priced to yield 25 basis points over comparable Treasuries. Merrill Lynch & Co. managed the offering.

Horace Mann Educators issued $90 million of step-up convertible subordination notes due 1999 at par. Noncallable for two years, the coupon on the notes will be 4% for two years and then increase to 6.5%. The notes convert into common stock at $35, a 23.89% conversion premium. Moody's rates the offering Baa3, while Standard & Poor's rates it BBB-plus. First Boston lead managed the offering. The deal was increased from $50 million.

Federal Farm Credit Bank issued $43 million of 5.23% medium-term notes due 1995 at par. The noncallable notes were priced to yield 12 basis points over comparable Treasuries. Goldman, Sachs & Co. managed the offering.

Rating News

Standard & Poor's yesterday put International Business Machine Corp.'s AAA debt rating on CreditWatch for a possible downgrade. Also placed under review were the triple-A ratings of IBM Credit Corp., IBM International Finance N.V., and IBM Japan.

The agency, however, affirmed IBM and IBM Credit Corp.' A-1-plus commercial paper ratings. About $9.6 billion of debt is affected.

"The rating action reflects increased uncertainty about the company's ability to restore performance to levels consistent with a triple-A rating," a Standard & Poor's release says. "While S&P expects restructuring efforts to be beneficial to long-term performance, difficult market conditions in some areas are likely to make near-term progress more limited."

Fitch Investors Service downgraded Wells Fargo & Co.'s $1.9 billion of senior debt to A-minus from A and removed it from Fitch Alert, where it was placed with negative implications on Oct. 12.

Fitch cut the company's $2 billion of subordinated debt to BBB-plus from A-minus and its $600 million of preferred stock to BBB from BBB-plus. It affirmed the A/F-1 ratings for long- and short-term certificates of deposit and letters of credit of Wells Fargo Bank N.A. and removed them from FitchAlert. Fitch calls the credit trend "uncertain."

"The downgrades reflect continued economic uncertainties in Wells Fargo's home state of California, particularly related to commercial real estate and residential real estate," a Fitch release says. "Wells Fargo is a major commercial real estate lender in California. At the end of the third quarter, approximately 34% of its loan portfolio was related to commercial real estate and developers."

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