Fed Says It Lacks Power To Curb Citicorp's Notes
The Federal Reserve k>ard has concluded, reluc-antly, that it has no author-ty to regulate an $850 mil-ion note offering by the larent company of the First Rational City Bank of New fork.</br></br>The seven-member board greed yesterday that the ffering is aimed at small avers and will no doubt 'raw large amounts of unds away from savings nd loan associations and autual savings banks.</br></br>These thrift institutions nake most of the mortgage Dans in the country and ;a ve already expei ienced harp falloffs in deposits be-ause of rapidly rising inter-st rates on competing in-estment opportunities.</br></br>The $850 million offering is in 15-year notes of Citicorp, with an interest rate that is tied to the interest rate paid on three-month Treasury bills. The rate will be one percentage point higher than the bill rate, which at MondayÛªs auction averaged 7.808 per cent.</br></br>Sources said last night there is some sentiment within the Federal Reserve Board to ask Congress to regulate offerings of these types.