The Herald Statesman from Yonkers, New York • 16

6B Tuesday, July 12, 1994 i- BRIEFLY i Interact rates rlM Interest rates on short-term Treasury securities rose in yesterdays auction to the highest level in nearly three years. The Treasury Department sold $12 billion in three-month bills at an average discount rate of 4.50 percent, up from 4.31 percent last week. Another $12.1 bil- lion was sold ini six-month bills at an average discount rateof44per- cent, up from 4.74 percent The three-month bill rate was the highest since they sold for 4.58 per-. cent on Nov. 18, 1991.

The six-month bill rate was the highest since they averaged 5.04 percent on Oct 28, 1991.. The new discount rates understate the actual return to investors 4.61 percent for three-frionth bills with a $10,000 bill selling for $9,886.30 and 5.14 percent for a six-month bill selling for $9,750.30. In a separate report the Federal Reserve said that the average yield for one-year Treasury bills, the most popular index for making -changes in adjustable! mortgages, rose tn 5.49 percent last week from 5.47 percent the previous week. Dwtta details cuts Delta Air Lines, which is aiming to cut up to 15,000 jobs from its payroll, said yesterday that shout a third of the jobs would coipe from its airport customer' service operation? The 4,500 jobs include baggagd and cargo handling, aircraft (deling and ticket counter workers. The Atlanta-based airline said it would offer voluntary programs to cut the staff before imposing layofb.

The jobs represent bout 20 percenj of the division's work fierce. I tf i 41 AL dscislon nsara A new United Airlines is revved up and ready for takeoff, awaiting only final clearance from the Stockholders of UAL Corp. It may come today, when the inircn investors meet in Chicago to vote urHlcu on a plan that would give 55 AIRUneS percent ownership of the company to its employees. Approval would make UAL, with about 75,700 workers, the countrys second-largest employee-owned company after IPublix Supermarkets of Lakeland, Fla. Metropolitan Life Insurance Co.

was fined $1.2 million yesterday for allegedly misleading Texas consumers who bought life insurance The companys agents told consumers that -the policies were retirement savings plans, said J. Robert Hunter, state insurance commissioner. Hunter ordered MetLifo to pay the fine and reimburse customers who were misled. The company will survey customers and those who didnt understand they were buying just life -insurance can file for reimbursement The policies were sold to 75,864 consumers. New York-based MetLife neither admitted or denied any wrongdoing.

Bsaflng up poultry rutes V. The Agriculture Department proposed new rules yesterday to strengthen poultry inspec-. tioni, including a xero tolerance for disease and contamination on chickens and turkeys leaving the slaughterhouse. The public will have 90 days to comment on the proposed rules, which are expected to take effect by late this year or in early 1995. Dell backs off ratall Dell Computer Corp.

said yesterday it will stop selling its products in retail outlets in the United States, Canada and Europe and focus on direct sales and a few wholesalers. While Dell, the nations sixth-largest maker of personal computers, has stopped shipping products to retailers, it will support retail outlets until their inventory of Dell products is depleted, said spokeswoman Michele Moore. The chains affected by Dells move are Com- pUSA, Best Buy, Price-CostCo and Sams Clubs, i Bordan completes sale Borden Inc. sold its Bama Foods unit Id' Welch Foods continuing its $1.2 billion restructuring. Terms werent disclosed.

Bama Foods has annual sales of about $70 million, Borden said. The Columbus, Ohio- based maker of food and non-food products had total 1993 sales of about $5.51 billion. Bama Foods, based in Birmingham, makes jams, jellies, mayonnaise and peanut butter sold in the South under the Bama name. Pica made In Honda cue A former employee of American Honda Mo-tor Co. pleaded guilty yesterday to taking bribes for helping people get or move Acura dealerships in four states.

David Pederson, 45, of Rosewell, is the 12th of 15 former Honda executives to plead guilty to charges stemming from a nationwide FBI investigation into improprieties involving American Honda executives. Coora cites gain Adolph Coors Co. reported yesterday that earnings jumped 26.5 percent for the kecond quarter, citing lower production costs and high-! er sales. v- Coors said net income for the quarter that ended June 12 was $23.9 million, or 83 cents per share, on revenues of $527.1 million. For-the second quarter in.

1993, the Colorado coip-; pany reported $18J) million in net income, or 50 cents per share, on revenues of $506.6 million. Investors get new help spotting derivatives dangers rate, insurance, municipal and international debt. But the majority are derivatives in the mortgage-backed which has been hit particularly hard this year. 'Many investors were shocked when their presumably safe money-market fonds lost money because some of the short-term debt instruments were speculative derivatives. Now, investors can check their fond prospectuses for securities that contain the "rH rating.

Other credit-rating agencies have tried with limited success to warn 'investors about derivatives. Fitch Investors Service introduced volatility ratings three years ago to quantify the extra risk associated with derivatives in the mortgage-backed market But' the symbol letters VI" through V10" is 'not in widespread use, saidINeil Baron, Fitchs vice chairman and general counsel. Many speculative varieties of derivatives have plunged in value in tandem with the rise in interesj rates this year although these securities might have contained the top credit-quality rating. Many investors were hit including money-management fonds such as New York-based Askin Capital Management which filed for bankruptcy protection this year and Wall Street companies and commercial banks that trade and design the derivatives transactions. Still, investment strategists say the system should not have much effect on professional investors faifiiliar with the risks of derivatives, Instead, the system might help smaller Investors who think the usual credit-quality barometers sufficiently measure risk.

The new symbol is attactfed to several instruments, including corpo- principal owed investors. Investors and investment managers rely on the ratings in SAPs case, top-rated securities get a triple A to determine whether theyre getting enough interest and principal to, compensate for the perceived risk of default The new symbol (bund in the prospectus that accompanies a securi-1 ty goes a step fhrther in response to the recent negative publicity over derivatives essentially transactions based on, or derived from, the underlying value of a security. This is extremely important, in that credit rating alone does not really indicate the potential risks Involved, said Jim Somers, who runs an asset-management company based in Radnor, Pa. Theres a lot of individuals out there who hold securities that are perhaps worth a lot less than they realize. By David LKallsh TIm Associated Pivm When your broker tells you to sink your money into a hot new investment, make sure its not branded with the letter Standard A Poor's, a major Wall Street credit-rating company, added a new rating yesterday to about 800 securities, most of them derivative instruments containing hidden traps for investors.

The for risk, is the "biggest move to date by a credit-rating company to alert investors to the dangers of derivatives, the little-understood Investments that plunged in value this year and left many investors and 'companies with heavy losses. SAP already grades thousands of bonds and other securities accordi til credit quality. the likelihood borrowers defaulting on Interest or. McDonald's offers tunes McDonalds Corp. will offer compact discs and cassettes by such performers as Garth Brooks, Roxette, the Barrio Boyzx and Selena to raise money for its charities.

The promotion, developed in conjunction with EMI Records Group North America, is slated to begin this fell at more than 9,500 McDonald's restaurants. Press and Compiled from Yht Associated Bloomberg Business Nets. 1 I.