<PAGE> 1
PRICING SUPPLEMENT NO. 4, DATED JANUARY 7, 1994 RULE 424(B)(3)
FILE NO. 33-50547
(TO PROSPECTUS DATED OCTOBER 22, 1993 AND
PROSPECTUS SUPPLEMENT DATED NOVEMBER 12, 1993)
AVCO FINANCIAL SERVICES, INC.
MEDIUM-TERM NOTES, SERIES E
(FLOATING RATE)
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<TABLE>
<S> <C>
Trade Date: January 7, 1994 Initial Interest Rate: 4.0%
Original Issue Date: January 14, 1994 Base Rate: / / CD Rate / / Commercial Paper Rate
Principal Amount: $50,000,000 / / Federal Funds Rate
/ / LIBOR-Reuters / / LIBOR-Telerate
Issue Price: See below / / Treasury Rate /X/ Other (see attached)
Maturity Date: January 14, 1999
Form: /X/ Book-Entry / / Certificated Interest Reset Period:
/ / Daily / / Weekly / / Monthly
/X/ Quarterly / / Semi-Annually
/ / Other
Interest Reset Dates: Jan. 14, April 14, July 14
and Oct. 14 of each year
Interest Payment Period: Quarterly
Interest Payment Dates: Jan. 14, April 14, July 14
and Oct. 14 of each year
Index Maturity: 2 year
Spread (+/-): -25 Basis Points
Spread Multiplier: N/A
Maximum Interest Rate: N/A
Minimum Interest Rate: N/A
</TABLE>
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Redemption:
/X/ The Notes cannot be redeemed prior to maturity
/ / The Notes may be redeemed prior to maturity
<TABLE>
<CAPTION>
REDEMPTION REDEMPTION
DATE(S) PRICE(S)
--------- ---------
<S> <C>
</TABLE>
Repayment:
/X/ The Notes cannot be repaid prior to maturity
/ / The Notes can be repaid prior to maturity at the option of the holder of
the Note
<TABLE>
<CAPTION>
REPAYMENT REPAYMENT
DATE(S) PRICE(S)
-------- --------
<S> <C>
</TABLE>
Original Issue Discount Note: / / Yes /X/ No
Total Amount of OID:
Yield to Maturity:
Initial Accrual Period:
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Agent: /X/ Merrill Lynch & Co.
/ / Morgan Stanley & Co. Incorporated
/ / Salomon Brothers Inc
/ / Other: Lehman Brothers Inc.
Agent acting in the capacity as indicated below:
/ / Agent /X/ Principal
If as principal:
/X/ The Notes are being offered at varying prices related to
prevailing market prices at the time of resale. Merrill Lynch &
Co. purchased the Notes at 99.50% of principal amount.
/ / The Notes are being offered at a fixed initial public offering
price of % of principal amount.
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ATTACHMENT TO AVCO FINANCIAL SERVICES, INC.
MEDIUM TERM NOTES, SERIES E, PRICING SUPPLEMENT NO. 4
For purposes of the Notes, the following additional terms shall apply:
The interest rate in effect for the period from the Original Issue Date to
the first Interstate Reset Date will be the Initial Interest Rate set forth
above. The interest rate in effect for each Interest Reset Period will be the
two-year Constant Maturity Treasury Rate ("CMT Rate") minus 25 basis points.
The "CMT Rate" means with respect to any Interest Reset Date (in the
following order of availability, as determined by the Calculation Agent):
(i) The one-week average yield on 2-year United States Treasury
securities at "constant maturity" as estimated from the United States
Department of the Treasury's weekly yield curve, as published in the latest
H.15(519) available on the applicable Interest Determination Date with
respect to such Interest Reset Date, provided that such H.15(519) was first
available not earlier than ten calendar days before such Interest
Determination Date, in the column for the week most recently ended opposite
the heading "U.S. government securities -- Treasury Constant Maturities,
2-Year."
(ii) If the latest H.15(519) available on the applicable Interest
Determination Date with respect to such Interest Reset Date was first
available prior to ten calendar days before such Interest Determination
Date, the CMT Rate will be such 2-year United States Treasury constant
maturity rate (or other 2-year United States Treasury rate) for such
Interest Determination Date(s) as may then be published by either the Board
of Governors of the Federal Reserve System or the United States Department
of the Treasury, and (b) that the Calculation Agent determines to be
comparable to the rate formerly published in H.15(519).
(iii) If the CMT Rate as described in clause (ii) above is not yet
available by 10:00 a.m. New York City Time on such Interest Determination
Date, then the CMT Rate shall be the average rate for the week immediately
preceding such Interest Determination Date as calculated by the Calculation
Agent by the interpolation from a yield curve for 1, 2 and 3 year U.S.
Treasury bills/notes using standard established industry practice from
closing bid prices reported to the Calculation Agent by three leading
government securities dealers selected by the Calculation Agent.
(iv) If fewer than three dealers selected as aforesaid by the
Calculation Agent are quoting as described in (iii) above, the CMT Rate
will be the CMT Rate in effect on the immediately preceding Interest Reset
Date.
Interest on the Notes will be calculated based on the actual number of days
elapsed over a year of 365 days (or, if any portion of the period for which
interest is being calculated falls in a leap year, the sum of (A) the actual
number of days in that portion of such period falling in a leap year divided by
366 and (B) the actual number of days in that portion of such period falling in
a non-leap year divided by 365).
The Interest Determination Date pertaining to an Interest Reset Date for
the Notes will be the second Business Day next preceding such Interest Reset
Date.
