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DTCC: Expects Record Number of Municipal Bonds to be Issued Today

New York, December 20, 2001 - The Depository Trust & Clearing Corporation's (DTCC) depository is scheduled to process a record 379 new municipal bond issuances today.

Cheryl Lambert, vice president of the depository's Settlement area, said 379 new municipal bond issues were scheduled to close, surpassing the old record set on June 29, 2000 of 365 municipal issues. The new issues were expected to be worth about $7.1 billion, which was not a record dollar amount. Some last minute adjustments are typical on closing day, however, and final numbers are not expected to be available until December 21.

"The mid-year and end-of-year periods are always heavy periods for new municipal bond issues, since that is when most municipal fiscal years end," she said. "This year, however, we have seen very heavy municipal bond issuance all year due to the low interest rates available for loans used to provide various municipal services, and it appears to be leading to a record number of new issues being processed today. Our initial projections indicate that January will also be a very heavy month for municipal bond issuances as well."

Lambert said in addition to municipal debt underwriting increases, increases had also been seen this year in Collateralized Mortgage Obligations (CMOs), Corporate Variable Rate Demand Obligations (VRDOs) and Asset Backed Securities (ABS's) such as credit card debt and auto loans, with CMOs increasing most dramatically to 867 issues in 2001from 373 issues in 2000. The issuance of new equity issues has been down substantially, as expected, with market prices down for much of the year and fewer initial public offerings (IPOs) being done.

DTCC's depository subsidiary, The Depository Trust Company, is the central securities depository for the U.S., holding in its custody about 84% of all outstanding equities listed on the New York Stock Exchange, 76% of all outstanding equity shares on Nasdaq, and more than 99% of all municipal bond issues and commercial paper, among other securities.

About DTCC

The Depository Trust & Clearing Corporation (DTCC), with operating facilities in multiple locations in the U.S. and overseas, is a holding company for six subsidiary businesses - a depository and five clearing corporations - as well as the co-owner with Thomson Financial of a global joint venture called Omgeo. Through its subsidiaries, DTCC provides clearance, settlement and information services for equities, corporate debt, municipal debt, government securities and mortgage-backed securities in the U.S., and emerging markets debt trades globally. It is also a leading clearinghouse for mutual funds and insurance products, linking funds and carriers with distribution networks. In addition, DTCC provides custody and asset servicing for more than two million securities from the U.S. and 84 other countries. For more information on DTCC, see www.dtcc.com.