<PAGE>
PRICING SUPPLEMENT NO. 40 Rule 424(b)(3)
DATED: February 22, 1995 File No. 33-55673
(To Prospectus dated October 7, 1994
and Prospectus Supplement dated October 7, 1994)
$3,891,376,750
THE BEAR STEARNS COMPANIES INC.
MEDIUM-TERM NOTES, SERIES B
WITH MINIMUM MATURITY OF NINE MONTHS FROM DATE OF ISSUE
Principal Amount: Floating Rate Notes Book Entry Notes
$75,000,000 [x] [x]
Original Issue Date: Fixed Rate Notes Certificated Notes
02/24/95 [_] [_]
Maturity Date: 02/26/96
Option to Extend Maturity: No [x]
Yes [_] Final Maturity Date:
Optional Optional
Redemption Repayment Repayment
Redeemable On Price(s) Date(s) Price(s)
------------- -------- ------- --------
N/A N/A N/A N/A
Applicable Only to Fixed Rate Notes:
- -----------------------------------
Interest Rate:
Applicable Only to Floating Rate Notes:
- --------------------------------------
Interest Rate Basis: Maximum Interest Rate: N/A
[_] Commercial Paper Rate Minimum Interest Rate: N/A
[*] Federal Funds Rate Interest Reset Date(s): **
[_] Treasury Rate Interest Reset Period: Daily
[_] LIBOR Interest Payment Date(s): ***
[_] Prime Rate
[_] CMT Rate
Initial Interest Rate: **** Interest Payment Period: Quarterly
Index Maturity: N/A
Spread (plus or minus): +.27%
- -------------------------
* For the purpose of this Note, "Federal Funds Rate" means, with respect
to any Interest Determination Date, the Federal Funds Open Rate which
appears on Telerate Page 5 (or such other page as may replace such
Telerate Page 5 for the purpose of displaying the Federal Funds Open
Rate) or, if no such rate is available on the Calculation Date
pertaining to such Interest Determination Date, the Federal Funds Rate
will be the rate on such Interest Determination Date as published in
H.15(519) under the heading "Federal Funds (Effective)." If neither
NYFS04...:\25\22625\0122\2322\DDD2225S.280
<PAGE>
<PAGE>
of such rates is published by 3:00 P.M., New York City time, on the
Calculation Date pertaining to such Interest Determination Date, the
Federal Funds Rate for such Interest Determination Date will be
calculated by the Calculation Agent and will be the arithmetic mean of
the rates for the last transaction in overnight Federal Funds arranged
by three leading brokers of federal funds transactions in the City of
New York selected by the Calculation Agent as of 11:00 A.M., New York
City time, on such Interest Determination Date; provided, however,
that if the brokers selected as aforesaid by the Calculation Agent are
not quoting as mentioned in this sentence, the rate of interest in
effect for the applicable period will be the rate of interest in
effect on such Interest Determination Date.
** Daily on each Business Day.
*** 05/26/95, 08/25/95, 11/27/95 and 02/26/96.
**** The Federal Funds Rate as of February 24, 1995 plus 27 basis points.
The Interest Determination Date with respect to this Note shall be the same
day as each Interest Reset Date.
The distribution of Notes will conform to the requirements set forth in the
applicable sections of Schedule E to the By-laws of the National
Association of Securities Dealers, Inc.
NYFS04...:\25\22625\0122\2322\DDD2225S.280
