A huge global bond offering by Finland helped new-issue volume sail past $3 billion yesterday.

Finland's $2 billion offering - the first global bond offering ever by a sovereign nation - was oversubscribed, according to Jim Quigley, a managing director at Merrill Lynch & Co., who said demand existed for about $2.5 billion of the bonds.

Merrill Lynch served as global coordinator on the offering and was one of three co-lead managers. The other two were J.P. Morgan Securities Inc. and Nomura International.

Finland's 6.75% noncallable bonds due 1997 were priced at 99.55 to yield 82 basis points over comparable Treasuries. Moody's investors Service rates the offering Aa2, while Standard & Poor's Corp. rates it AA-plus.

By late afternoon yesterday, the issue was trading two basis points tighter on the bid side, Quigley said.

Approximately 40% to 45% of the offering was distributed in North America, with 35% to 40% in Europe and the remainder in the Far East. Buyers represented approximately 150 institutions, he said.

"North America was the biggest bid early on and it provided the catalyst to the other markets," Quigley said. He added that,the strength of the U.S. dollar prompted a significant amount of dollar-based buying from abroad.

Key to the deal's success was that investors were sufficiently well-schooled in the offering's "turnaround" story, Quigley said. Investors recognized the Finnish government's efforts to turn the country's economy around.

Initially, when managers were contemplating offering the issue at 85 basis points over, approximately $3 billion of demand existed, he said.

Finland's deal helped bring the new-issue total to $3.13 billion late yesterday, excluding medium-term note issues. According to Securities Data Co., new-issue volume surpassed $3 billion on 11 previous days this year.

Securities Data's figures are for nonconvertible corporate bonds, excluding mortgage and asset-backed issues but including agencies.

In other news, a U.S. bankruptcy court judge in Delaware has set a hearing on Continental Airlines' disclosure statement for Jan. 8, the company said in a release.

Continental earlier said it had filed an amended reorganization plan and disclosure statement detailing the company's plans to emerge from Chapter 11 bankruptcy next year.

The reorganization plan is based on a $450 million cash investment by Air Canada/Air Partners, L.P. The plan gives the investment group and the airline's unsecured creditors a significant ownership stake, the release said.

Elsewhere, a Prudential official yesterday said Standard & Poor's decision to lower the company's rating to AA-plus from AAA "reflects the fact we are keeping our promises to our policyowners and will pay out more than $1 billion dollars to victims of the most destructive hurricane in history."

"If providing the service our clients have come to expect from us results in a change in our ratings, so be it," the official, Edward D. Zinbarg, an executive vice president, said in a release. "Hurricane Andrew may very well turn out to be a singular event, a one-time hit, but the fact is our financial strength made us ready for it."

In secondary trading yesterday, investment-grade corporates moved in line with Treasuries, which finished slightly higher. A paper shortage pushed high-yield bonds up 1/8 point, traders said.

New issues

Ford Motor Credit issued $400 million of 7.75% notes due 2002. The noncallable notes were priced at 99.395 to yield 7.838%, or 98 basis points over comparable Treasuries. Moody's rates the offering A2, while Standard & Poor's rates it A. First Boston Corp. lead managed the offering.

Gulf States Utilities issued a four-part first mortgage bond offering totaling $300 million.

The first tranche consisted of $75 million of 6.67% bonds due 1996 at par. They were priced to yield 83 basis points over comparable Treasuries. The second piece consisted of $75 million of 6.99% bonds due 1997 at par. The noncallable bonds were priced to yield 90 basis points over comparable Treasuries.

The third tranche consisted of $75 million of 7.35% bonds due 1998 at par. The noncallable bonds were priced to yield 90 basis points over comparable Treasuries. The fourth consisted of $75 million of 7.46% bonds due 1999 at par. The noncallable bonds were priced to yield 95 basis points over comparable Treasuries. Moody's rates the offering Baa2, while Standard & Poor's rates it BBB. Goldman, Sachs & Co. lead managed the offering.

First Union Corp. issued $225 million of 8% subordinated notes due 2002. The noncallable notes were priced at 99.65 to yield 8.051% or 118 basis points over comparable Treasuries. Moody's rates the offering Baa2, while Standard & Poor's rates it BBB-plus. Goldman Sachs lead managed the offering.

European Investment issued $200 million of 4.905% medium-term notes due 1994 at par. The noncallable notes were priced to yield 28 basis points over comparable Treasuries. Merrill Lynch managed the offering.

Bell Atlantic Financial issued $130 million of 6.625% notes due 1997. The noncallable notes were priced at 99.752 to yield 6.684%, or 59 basis points over comparable Treasuries. Moody's rates the offering A1, while Standard & Poor's rates it AA-minus. Merrill Lynch lead managed the offering.

GTE South issued $75 million of 6.25% debentures due 1997. The noncallable debentures were priced at 98.60 to yield 6.584%, or 51 basis points over comparable Treasuries. Moody's rates the offering A3, while Standard & Poor's rates it A. A Kidder, Peabody & Co. led a group that won competitive bidding to underwrite the offering.

U.S. West Financial Services issued $50 million of 6.75% medium-term notes due 1997. The notes were priced initially at par to yield 70 basis points over comparable Treasuries and were reoffered at various prices. Moody's rates the offering A2, while Standard & Poor's rates it A-plus. Salomon Brothers Inc. lead managed the offering.

In ratings action, Moody's lowered the senior debt of Westinghouse Electric Corp. and its finance subsidiary, Westinghouse Credit Corp., to Baa3 from Baa2 and lowered the commercial paper ratings of both to Prime-3 from Prime-2. All ratings remain under review for a possible further downgrade, a Moody's release says.

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