<PAGE>
Rule 424(b)(2)
Registration No. 33-50395
PROSPECTUS SUPPLEMENT
- ---------------------
(TO PROSPECTUS DATED OCTOBER 15, 1993)
$75,000,000
BANKERS TRUST NEW YORK CORPORATION
7 1/2% SUBORDINATED NOTES DUE 2010
----------------
Interest on the Offered Notes is payable by Bankers Trust New York
Corporation (the "Corporation") on the 15th of each month of each year,
beginning July 15, 1995, and the Offered Notes will mature on June 15, 2010.
The Offered Notes will be unsecured and subordinated as described herein under
"Certain Terms of the Offered Notes--Subordination."
The Offered Notes may not be redeemed prior to June 15, 2000. On or after
such date, all, but not less than all, of the Offered Notes may be redeemed at
the option of the Corporation semi-annually on each June 15 and December 15
upon at least 30 days' notice at par plus accrued interest to the date fixed
for redemption. See "Certain Terms of the Offered Notes--Optional Redemption."
Payment of the principal of the Offered Notes may be accelerated only in the
case of certain events involving the bankruptcy, insolvency or reorganization
of the Corporation. There is no right of acceleration in the case of a default
in the performance of any covenant of the Corporation, including the payment of
principal or interest. See "Description of Debt Securities" in the Prospectus
accompanying this Prospectus Supplement.
The Offered Notes will be represented by Global Debt Securities registered in
the name of the nominee of The Depository Trust Company, New York, New York
("DTC"), which will act as the Depository. Interests in the Offered Notes
represented by Global Debt Securities will be shown on, and transfers thereof
will be effected only through, records maintained by the Depository and its
direct and indirect participants. Except as described herein, Offered Notes in
definitive form will not be issued. Settlement for the Offered Notes will be
made in immediately available funds. The Offered Notes will trade in the
Depository's Same-Day Funds Settlement System and secondary market trading
activity for the Offered Notes will therefore settle in immediately available
funds. All payments of principal and interest will be made by the Corporation
in immediately available funds or the equivalent. See "Certain Terms of the
Offered Notes--Same-Day Settlement and Payment."
----------------
THE OFFERED NOTES ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF A BANK AND ARE NOT
INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL
AGENCY.
----------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR
THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
<TABLE>
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
<CAPTION>
UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC(1) COMMISSIONS(2) CORPORATION(1)(3)
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Offered Note ................ 99.735% 2% 97.735%
- ---------------------------------------------------------------------------------------------
Total ........................... $74,801,250 $1,500,000 $73,301,250
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
</TABLE>
(1) Plus accrued interest from June 22, 1995, if any.
(2) The Corporation has agreed to indemnify the Underwriter against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended. See "Underwriting."
(3) Before deduction of expenses payable by the Corporation estimated at
$100,000.
----------------
The Offered Notes are offered by the Underwriter, subject to prior sale,
when, as and if issued to and accepted by it, subject to approval of certain
legal matters by counsel for the Underwriter and certain other conditions. The
Underwriter reserves the right to withdraw, cancel or modify such offer and to
reject orders in whole or in part. It is expected that delivery of the Offered
Notes will be made in book-entry form through the facilities of DTC on or about
June 22, 1995.
----------------
MERRILL LYNCH & CO.
----------------
The date of this Prospectus Supplement is June 19, 1995.
<PAGE>
BANKERS TRUST NEW YORK CORPORATION
GENERAL
Bankers Trust New York Corporation (the "Corporation") is a bank holding
company, incorporated under the laws of the State of New York in 1965. At March
31, 1995, the Corporation had consolidated total assets of $107.4 billion. The
Corporation's principal banking subsidiary is Bankers Trust Company
("Bankers"). Bankers, founded in 1903, is among the largest commercial banks in
New York City and the United States, based on consolidated total assets. The
Corporation concentrates its financial and managerial resources on selected
markets and services its clients by meeting their needs for financing,
advisory, processing and sophisticated risk management solutions. The core
organizational units of the Corporation are the Global Investment Bank, Global
Markets Proprietary, Global Investment Management, Global Emerging Markets and
Global Assets. Other business activities include real estate finance and
principal investing. The Corporation also conducts its own proprietary
operations. Among the institutional market segments served are corporations,
banks, other financial institutions, governments and agencies, retirement
plans, not-for-profit organizations, wealthy individuals, foundations, private
companies and individual investors. Bankers originates loans and other forms of
credit, accepts deposits, arranges financings and provides numerous other
commercial banking and financial services. Bankers provides a broad range of
financial advisory services to its clients. It also engages in the proprietary
trading of currencies, securities, derivatives and commodities.
The Corporation is a legal entity separate and distinct from its
subsidiaries, including Bankers. There are various legal limitations governing
the extent to which the Corporation's banking subsidiaries may extend credit,
pay dividends or otherwise supply funds to, or engage in transactions with, the
Corporation or certain of its other subsidiaries. The rights of the Corporation
to participate in any distribution of assets of any subsidiary upon its
dissolution, winding-up, liquidation or reorganization or otherwise are subject
to the prior claims of creditors of that subsidiary, except to the extent that
the Corporation may itself be a creditor of that subsidiary and its claims are
recognized. Claims on the Corporation's subsidiaries by creditors other than
the Corporation include long-term debt and substantial obligations with respect
to deposit liabilities, trading liabilities, federal funds purchased,
securities sold under repurchase agreements and commercial paper, as well as
various other liabilities.
The Corporation's principal executive offices are located at 280 Park Avenue,
New York, New York 10017 and its telephone number is (212) 250-2500.
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
THREE MONTHS
ENDED
YEAR ENDED DECEMBER 31, MARCH 31,
------------------------ -------------
1990 1991 1992 1993 1994 1994 1995
---- ---- ---- ---- ---- ------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
Excluding Interest on Deposits.... 1.30 1.40 1.44 1.71 1.28 1.34 .73
Including Interest on Deposits.... 1.16 1.22 1.28 1.48 1.21 1.26 .80
</TABLE>
For purposes of computing these consolidated ratios, earnings represent
income (loss) before income taxes, cumulative effects of accounting changes and
equity in undistributed income of unconsolidated subsidiaries and affiliates,
plus fixed charges excluding capitalized interest. Fixed charges represent all
interest expense (ratios are presented both excluding and including interest on
deposits), the portion of net rental expense which is deemed representative of
the interest factor, the amortization of debt issuance expense and capitalized
interest. For the three months ended March 31, 1995, earnings, as defined, did
not cover fixed charges, excluding and including interest on deposits, by $231
million, as a result of a net loss recorded during the period.
S-2
<PAGE>
CONSOLIDATED RESULTS OF OPERATIONS
The Corporation recorded a loss of $122 million for the quarter ended March
31, 1995, or $1.66 primary loss per share, excluding an after-tax provision for
severance-related costs of $35 million taken in connection with the
Corporation's expense reduction programs. Net loss for the quarter, including
the effect of this provision, was $157 million, or $2.11 primary loss per
share. In the first quarter of 1994, the Corporation earned $164 million, or
$1.90 primary earnings per share.
BUSINESS FUNCTIONS ANALYSIS
Because the Corporation's business is complex in nature and its operations
are highly integrated, it is impractical to segregate the respective
contributions of the business functions with precision. For example, the Client
Advisory function is difficult to split from the Client Finance function, since
most complex financings include both an element of advice and the arrangement
of credit for the client. Further, transactions undertaken for purposes of
Client Financial Risk Management may contain an element of Client Finance or
Trading and Positioning. Finally, the Trading and Positioning function serves
as an element of support for client-based activities. As a result, estimates
and subjective judgments have been made to apportion revenue and expenses among
the business functions. In addition, certain revenue and expenses have been
excluded from the business functions because, in the opinion of management,
they could not be reasonably allocated or because their attribution to a
particular function would be distortive.
The following table breaks down earnings on the basis of the Corporation's
five business functions, which represent its core business activities and are
an important tool for analyzing the results of operations. Detailed definitions
of these categories, as well as a discussion of the methodology used to
calculate their results, appear in the 1994 Annual Report on Form 10-K.
BUSINESS FUNCTIONS PROFITABILITY
(IN MILLIONS)
<TABLE>
<CAPTION>
FIRST FIRST
QTR. QTR. INCREASE
1995 1994 (DECREASE)
----- ----- ----------
<S> <C> <C> <C>
Client Finance................................... $ 14 $ 43 $ (29)
Client Advisory.................................. 20 30 (10)
Client Financial Risk Management................. (122) 114 (236)
Client Transaction Processing.................... 8 32 (24)
Trading and Positioning.......................... (36) (49) 13
Unallocated...................................... (41) (6) (35)
----- ---- -----
Income (Loss).................................. $(157) $164 $(321)
===== ==== =====
</TABLE>
Client Finance--Client Finance income was $14 million in the first quarter of
1995, down from $43 million in last year's first quarter. This decline was
principally attributable to lower levels of securities underwriting and loan
syndication fees as general market activity for financings was relatively
slower than the year-ago quarter.
Client Advisory--Client Advisory income was $20 million in the first quarter
of 1995, a decline of $10 million from the prior year's first quarter. This
decline was primarily due to a decrease in revenue from funds management
activities offset in part by higher revenue from merger and acquisition and
financial advisory activities.
Client Financial Risk Management--Client Financial Risk Management income
decreased by $236 million from the exceptionally strong period last year
principally due to a sudden absence of liquidity in
S-3
<PAGE>
selected emerging markets of Latin America. Additionally, while the volume of
transactions from risk management products remained relatively steady, revenue
has been reduced as the mix of business has shifted to lower-margin
transactions.
Client Transaction Processing--Client Transaction Processing income was $8
million in the first quarter of 1995, down $24 million from the prior year's
first quarter. This decline was primarily due to a decrease in processing
volumes. Also impacting this function was a higher level of expenses in the
Corporation's Australian subsidiary.
Trading and Positioning--The Corporation recorded a Trading and Positioning
net loss of $36 million during the first quarter of 1995 principally due to
losses in fixed income securities, primarily in Latin America. In the first
quarter of 1994 the Corporation recorded a net loss of $49 million.
Unallocated--Included in the unallocated category during the first quarter of
1995 was a $35 million after-tax provision for severance-related costs
associated with the expense reduction programs.
REVENUE
The table below shows net interest revenue, average balances and average
rates. The tax equivalent adjustment is made to present the revenue and yields
on certain assets, primarily tax-exempt securities and loans, as if such
revenue were taxable.
<TABLE>
<CAPTION>
THREE MONTHS
ENDED
MARCH 31,
---------------- INCREASE
1995 1994 (DECREASE)
------- ------- ----------
<S> <C> <C> <C>
Net Interest Revenue (in millions)
Book basis................................... $ 182 $ 370 $ (188)
Tax equivalent adjustment.................... 15 21 (6)
------- ------- -------
Fully taxable basis.......................... $ 197 $ 391 $ (194)
======= ======= =======
Average Balances (in millions)
Interest-earning assets...................... $78,228 $81,037 $(2,809)
Interest-bearing liabilities................. 75,642 77,935 (2,293)
------- ------- -------
Earnings assets financed by noninterest-bear-
ing funds................................... $ 2,586 $ 3,102 $ (516)
======= ======= =======
Average Rates (fully taxable basis)
Yield on interest-earning assets............. 7.09% 6.17% .92%
Cost of interest-bearing liabilities......... 6.28 4.38 1.90
------- ------- -------
Interest rate spread......................... .81 1.79 (.98)
Contribution of noninterest-bearing funds.... .21 .17 .04
------- ------- -------
Net interest margin.......................... 1.02% 1.96% (.94)%
======= ======= =======
</TABLE>
Net interest revenue for the first quarter of 1995 totaled $182 million, down
$188 million, or 51 percent, from the first quarter of 1994. Of this decline,
$176 million was from trading-related net interest revenue.
Combined trading revenue and trading-related net interest revenue for the
first quarter of 1995 was a loss of $77 million, a $268 million decrease from
the first quarter of 1994. The first quarter loss was primarily attributable to
losses sustained in the emerging markets of Latin America. The devaluation of
the Mexican peso and the associated sudden absence of liquidity adversely
affected the Corporation's positions. Additionally, while the volume of
transactions from the Corporation's Client Financial Risk Management activities
remained relatively steady, revenue has been reduced as the mix of business has
shifted to lower-margin transactions.
S-4
<PAGE>
A significant portion of the Corporation's trading and risk management
activities involve positions in interest rate instruments and related
derivatives. The revenue from these activities can periodically shift between
trading and net interest, depending on a variety of factors, including risk
management strategies. Therefore, the Corporation views trading revenue and
trading-related net interest revenue together, as quantified below (in
millions):
<TABLE>
<CAPTION>
TRADING-
RELATED
TRADING NET INTEREST
REVENUE REVENUE TOTAL
------- ------------ -----
<S> <C> <C> <C>
Three months ended March 31, 1995
Interest rate risk........................... $ (57) $ 18 $ (39)
Foreign exchange risk........................ (43) -- (43)
Equity and commodity risk.................... 22 (17) 5
----- ---- -----
Total....................................... $ (78) $ 1 $ (77)
===== ==== =====
Three months ended March 31, 1994
Interest rate risk........................... $ 32 $185 $ 217
Foreign exchange risk........................ (110) -- (110)
Equity and commodity risk.................... 92 (8) 84
----- ---- -----
Total....................................... $ 14 $177 $ 191
===== ==== =====
</TABLE>
Interest Rate Risk--The Corporation's positions in interest rate instruments
and related derivatives were adversely affected by the general volatility in
interest rates that occurred during the first quarter of 1995 coupled with
unusual fluctuations and associated liquidity problems in the emerging markets
of Latin America. As a result, total trading and trading-related net interest
revenue declined $256 million from the exceptionally strong results recorded in
the first quarter of 1994.
Foreign Exchange Risk--Trading revenue improved compared to the first quarter
of 1994, however, the results were negatively affected by the continued
volatility in foreign exchange markets which saw the dollar fall to record lows
against the mark and yen.
Equity and Commodity Risk--The first quarter trading and trading-related net
interest revenue was down $79 million compared to the first quarter of 1994.
The devaluation of the Mexican peso and continued uncertainty regarding the
Argentine economy had a ripple effect on equity prices throughout Latin
America. During the quarter actions by the International Monetary Fund, the
announcement of economic reforms in Argentina, Brazil and Mexico and
considerable public debate about the financial stability in the region
contributed to considerable volatility in the markets.
S-5
<PAGE>
Shown below is a comparison of the components of noninterest revenue (in
millions).
<TABLE>
<CAPTION>
THREE MONTHS
ENDED
MARCH 31,
-------------- INCREASE
1995 1994 (DECREASE)
------ ------ ----------
<S> <C> <C> <C>
Trading......................................... $ (78) $ 14 $ (92)
Fiduciary and funds management.................. 171 188 (17)
Fees and commissions
Corporate finance fees......................... 72 108 (36)
Service charges on deposit accounts............ 19 22 (3)
Acceptances and letters of credit commissions.. 10 11 (1)
Other.......................................... 44 41 3
------ ------ -----
Total fees and commissions...................... 145 182 (37)
------ ------ -----
Securities available for sale gains............. 2 4 (2)
Other noninterest revenue
Insurance premiums............................. 49 55 (6)
Net revenue from equity investment
transactions.................................. 26 29 (3)
Other.......................................... 27 33 (6)
------ ------ -----
Total other noninterest revenue................. 102 117 (15)
------ ------ -----
Total noninterest revenue....................... $ 342 $ 505 $(163)
====== ====== =====
</TABLE>
Fiduciary and funds management revenue totaled $171 million for the first
quarter, down $17 million, or 9 percent, from the same period last year.
Decreased revenue was recorded by most business activities within this revenue
category, primarily due to a decline in transaction volumes.
Fees and commissions of $145 million decreased by $37 million, or 20 percent,
from the first quarter of 1994. Corporate finance fees of $72 million decreased
by $36 million from the same period last year, due to lower revenue from
securities underwriting and loan syndication fees. These results were partially
offset by higher revenue from merger and acquisition and financial advisory
activities.
The Corporation's securities available for sale gains were $2 million,
compared with $4 million in the prior year's first quarter.
Other noninterest revenue totaled $102 million, down $15 million, or 13
percent, from the prior year's quarter. This decrease was due to a decline in
the category of equity in income of unconsolidated subsidiaries, lower
insurance premium revenue as well as lower net gains from sales of equity
investments and other assets. These factors were partially offset by a lower
level of losses from the revaluation of non-trading foreign currency
investments.
EXPENSES
In response to the lower revenue and reduced market activity in certain
businesses, management has implemented a wide range of expense reduction
programs. These programs were designed to reduce overall operating expenses
(principally, noninterest expenses before bonus and policyholder benefits) by
approximately $200 million in 1995. Management anticipates that these actions
will result in savings of approximately $275 million in 1996.
In order to accomplish these expense reductions, it is anticipated that total
staff will be reduced by approximately 1,400, comprised of 1,000 regular staff
and 400 temporary employees. In order to provide for appropriate cost of
severance, the Corporation has recorded a provision for severance-related cost
of $50 million, pre-tax, in the first quarter. As of the end of the first
quarter, approximately half of the planned staff reductions had been achieved.
The plan will be implemented fully in 1995.
S-6
<PAGE>
Total noninterest expenses of $734 million increased by $93 million, or 15
percent, from the first quarter of 1994. Excluding the provision for severance-
related costs of $50 million, noninterest expenses were $684 million, an
increase of $43 million, or 7 percent, from last year's first quarter.
Incentive compensation and employee benefits expense decreased $29 million, or
18 percent, due primarily to lower bonus expense reflecting the reduced
earnings. Salaries expense increased $31 million, or 18 percent, from the first
quarter of 1994. The average number of employees increased by 5 percent versus
the same period, up to 14,369, whereas the number of employees at March 31,
1995 decreased by 3 percent, to 14,144 from December 31, 1994 as a result of
the initial effect of the expense reduction programs.
All other expenses, excluding the provision for severance-related costs,
totaled $343 million for the quarter, up $41 million, or 14 percent, from last
year's first quarter. Increases in professional fees and agency personnel fees
accounted for more than half of this increase.
INCOME TAXES
Income tax benefit for the first quarter of 1995 amounted to $67 million,
compared with income tax expense of $70 million for the first quarter of 1994.
The effective tax rate was 30 percent for the current and prior year quarters.
PROVISION AND ALLOWANCE FOR CREDIT LOSSES
The provision for credit losses is dependent upon management's evaluation as
to the amount needed to maintain the allowance for credit losses at a level
considered appropriate in relation to the risk of losses inherent in the
portfolio.
The Corporation recorded $21 million of net charge-offs and a $14 million
provision for credit losses in the first quarter of 1995. In the prior year's
first quarter, $21 million of net recoveries was recognized and no provision
for credit losses was required. Nonrefinancing country net charge-offs for the
first quarter of 1995 were $28 million, which included $20 million of loans to
highly leveraged borrowers and $8 million of real estate loans, compared with
$2 million of nonrefinancing country net recoveries in the prior year's first
quarter. Leveraged derivative transaction charge-offs for the quarter were
immaterial. Refinancing country recoveries for the first quarter of 1995 were
$7 million, compared with $19 million of recoveries in last year's first
quarter.
The allowance for credit losses, at $1.245 billion at March 31, 1995, was
down $7 million from its level at December 31, 1994. The allowance was equal to
127 percent and 126 percent of total cash basis loans at March 31, 1995 and
December 31, 1994, respectively. The allowance for credit losses is available
for credit losses in the entire portfolio, which is comprised of loans, credit-
related commitments, derivatives and other financial instruments. Therefore,
the Corporation believes that the allowance must be viewed in its entirety.
In the opinion of management, the allowance, when taken as a whole, is
adequate to absorb reasonably estimated credit losses inherent in the
Corporation's portfolio.
On January 1, 1995, the Corporation adopted SFAS 114, "Accounting by
Creditors for Impairment of a Loan" as amended by SFAS 118, "Accounting by
Creditors for Impairment of a Loan--Income Recognition and Disclosure." SFAS
114 requires the creation of a valuation allowance for impaired loans. Under
SFAS 114, a loan is impaired when, based on current information and events, it
is probable that a creditor will be unable to collect all amounts due according
to the loan's contractual terms.
S-7
<PAGE>
At March 31, 1995, the recorded investment in loans that was considered to be
impaired under SFAS 114 was $1.079 billion which consisted of total cash basis
loans and renegotiated loans. Included in this amount was $632 million of
impaired loans for which the related valuation allowance was $111 million.
RECENT DEVELOPMENTS
On March 10, 1995, Moody's Investors Service, Inc. ("Moody's") announced that
it had placed the long-term ratings of the Corporation under review for
possible downgrade, and on June 14, 1995, Moody's lowered the Corporation's
senior debt rating to A2 from A1, its subordinated debt rating to A3 from A2
and its preferred stock rating to "a2" from "a1". On March 13, 1995, Standard
and Poor's Rating Group announced that it had revised the ratings outlook of
the Corporation to negative from stable.
Following the sharp increase in interest rates during the first quarter of
1994, various counterparties that had entered into leveraged derivative
transactions with certain subsidiaries of the Corporation experienced losses
and some of those counterparties have made claims against the Corporation. The
Corporation has settled some of the claims made by certain counterparties and
is contesting allegations made by others, including Procter & Gamble. In
connection with these developments, during the fourth quarter of 1994, the
Corporation placed on a cash basis $423 million of leveraged derivative
transactions which had been reclassified as receivables in its loan account. Of
this amount, the Corporation concurrently charged off $72 million to its
allowance for credit losses. Approximately one half of the remainder relates to
transactions with Procter & Gamble. With these transfers and charge-offs, the
Corporation has reclassified those leveraged derivative transactions that, in
its judgment, are not likely to perform according to the applicable contracts
and has charged off the balances it deemed to be uncollectible. However, there
can be no assurance that there will not be other such actions or claims in the
future.
BT Securities Corporation ("BT Securities"), a subsidiary of the Corporation,
has entered into a settlement agreement with the Securities and Exchange
Commission (the "SEC") and the Commodity Futures Trading Commission (the
"CFTC") concerning all investigations of the Corporation and its subsidiaries
by those agencies with respect to the conduct of its privately negotiated over-
the-counter derivatives (the "Derivatives") business. As part of that
settlement entered into on December 22, 1994, the SEC and the CFTC agreed not
to further pursue Bankers Trust related entities concerning Derivatives matters
prior to the settlement date (although they did reserve the right to pursue
individuals), and BT Securities paid $10 million in civil penalties and agreed
to and has retained independent consultants to examine its conduct of the
Derivatives business. The Corporation also has agreed to implement the
consultants' recommendations.
The Corporation, Bankers and BT Securities have also entered into a Written
Agreement with the Federal Reserve Bank of New York and a Memorandum of
Understanding with the New York State Banking Department concerning the
Corporation's leveraged derivative transactions business, both of which call
for an independent counsel review.
The Corporation cannot predict the effect on the derivatives business
generally, or the Corporation's derivatives business in particular, of these
events or of the current legislative, regulatory and media attention being
given to the derivatives industry.
Details with respect to the foregoing are set forth in the Corporation's
Annual Report on Form 10-K for the year ended December 31, 1994 which is
incorporated herein by reference.
S-8
<PAGE>
SELECTED CONSOLIDATED FINANCIAL DATA AND OTHER INFORMATION
The following selected consolidated financial data at and for each of the
three years ended December 31, 1992, 1993 and 1994 have been derived from and
are qualified in their entirety by the detailed financial information and
consolidated financial statements of the Corporation included in its Annual
Report on Form 10-K for the year ended December 31, 1994 which is incorporated
herein by reference.
The consolidated financial data at and for each of the three months ended
March 31, 1994 and 1995 is unaudited but, in the opinion of management, all
material adjustments necessary for a fair presentation of its results of
operations for such periods have been made. All such adjustments were of a
normal recurring nature. The results for the three months ended March 31, 1995
are not necessarily indicative of the results for the full year or any other
interim period.
<TABLE>
<CAPTION>
AT OR FOR THE
AT OR FOR THE THREE MONTHS ENDED
YEAR ENDED DECEMBER 31, MARCH 31,
------------------------- --------------------
1992 1993 1994 1994 1995
------- ------- ------- --------- ---------
($ IN MILLIONS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
Condensed Consolidated State-
ment of Income:
Interest revenue............. $ 4,219 $ 4,436 $ 5,030 $ 1,211 $ 1,353
Interest expense............. 3,072 3,122 3,858 841 1,171
------- ------- ------- --------- ---------
Net interest revenue......... 1,147 1,314 1,172 370 182
Provision for credit losses.. 225 93 25 -- 14
------- ------- ------- --------- ---------
Net interest revenue after
provision for credit loss-
es.......................... 922 1,221 1,147 370 168
Noninterest revenue.......... 2,331 3,364 2,473 505 342
Noninterest expenses......... 2,347 3,035 2,751 641 734
------- ------- ------- --------- ---------
Income (loss) before income
taxes and cumulative ef-
fects of accounting
changes..................... 906 1,550 869 234 (224)
Income taxes................. 267 480 254 70 (67)
------- ------- ------- --------- ---------
Income (loss) before cumula-
tive effects of accounting
changes..................... 639 1,070 615 164 (157)
Cumulative effects of ac-
counting changes (1)........ 446 (75) -- -- --
------- ------- ------- --------- ---------
Net income (loss)............ $ 1,085 $ 995 $ 615 $ 164 $ (157)
======= ======= ======= ========= =========
Net income (loss) applicable
to common stock............. $ 1,055 $ 972 $ 587 $ 159 $ (165)
======= ======= ======= ========= =========
Per Common Share Data:
Primary earnings (loss) per
share
Income (loss) before cumu-
lative effects of account-
ing changes................ $ 7.23 $ 12.40 $ 7.17 $ 1.90 $ (2.11)
Net income (loss)........... 12.53 11.51 7.17 1.90 (2.11)
Fully diluted earnings
(loss) per share
Income (loss) before cumu-
lative effects of account-
ing changes................ 7.22 12.29 7.17 1.90 (2.11)
Net income (loss)........... 12.51 11.41 7.17 1.90 (2.11)
Cash dividends declared...... 2.88 3.24 3.70 .90 1.00
--as a percentage of net
income (2)................. 40% 26% 52% 47% N/M
Book value (3)............... 43.23 51.90 53.67 52.41 50.04
Profitability Ratios:
Return on average common
stockholders' equity (2).... 19.52% 26.33% 13.48% 14.85% N/M
Return on average total as-
sets (2).................... .86 1.25 .59 .61 N/M
Consolidated Balances, End of
Period:
Trading assets............... $29,908 $48,276 $47,514 $ 56,173 $ 51,603
Loans........................ 17,318 15,200 12,501 13,659 11,731
Total assets................. 72,886 92,082 97,016 103,721 107,362
Deposits..................... 25,071 22,776 24,939 20,049 24,596
Securities sold under repur-
chase agreements............ 17,451 23,834 15,617 25,842 18,631
Other short-term borrowings.. 11,779 18,992 18,222 17,480 16,396
Long-term debt............... 3,992 5,597 6,455 5,693 6,621
Common stockholders' equity.. 3,621 4,284 4,309 4,295 4,029
Total stockholders' equity... 4,121 4,534 4,704 4,745 4,668
Consolidated Capital Ratios,
End of Period:
Common stockholders' equity
to total assets............. 4.97% 4.65% 4.44% 4.14% 3.75%
Total stockholders' equity
to total assets............. 5.65 4.92 4.85 4.57 4.35
Risk-based capital ratios
(1992 year-end guide-
lines)(4)
Tier 1 Capital............. 7.75 8.50 9.05 8.89 8.73
Total Capital.............. 13.64 14.46 14.77 14.66 14.20
Leverage Ratio............... 6.05 6.28 5.26 5.39 5.18
EMPLOYEES..................... 12,917 13,571 14,529 13,748 14,144
</TABLE>
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(1) The Corporation adopted the accounting standards for postretirement
benefits other than pensions (SFAS 106) and post-employment benefits (SFAS
112) effective January 1, 1993, and for income taxes (SFAS 109) effective
January 1, 1992.
(2) These figures exclude the cumulative effects of accounting changes recorded
in 1992 and 1993.
(3) This calculation includes the effect of common shares issuable under
deferred stock awards.
(4) The 1992 ratios were not restated in connection with the retroactive
adoption of SFAS 109. At both December 31, 1994 and December 31, 1993, all
three regulatory capital ratios excluded any benefit from the adoption of
SFAS 115.
N/M Not Meaningful
S-9
<PAGE>
CERTAIN TERMS OF THE OFFERED NOTES
GENERAL
The Corporation's 7 1/2% Subordinated Notes due 2010 offered hereby (the
"Offered Notes") will be limited to $75,000,000 aggregate principal amount and
will mature on June 15, 2010. The Offered Notes will be issued pursuant to an
Indenture, dated as of April 1, 1992, between the Corporation and Marine
Midland Bank (formerly Marine Midland Bank, N.A.), as Trustee (the "Trustee"),
as supplemented by the First Supplemental Indenture thereto, dated as of
January 15, 1993, between the Corporation and the Trustee (collectively, the
"Subordinated Indenture"). The Offered Notes will bear interest at the rate of
7 1/2% per annum from June 22, 1995, payable monthly in arrears on the 15th day
of each month in each year, beginning on July 15, 1995, to the persons in whose
names the Offered Notes (or any predecessor Offered Notes) are registered at
the close of business on the 1st day of each such month commencing on July 1,
1995.
The Offered Notes will be issued in fully registered form, in denominations
of $1,000 and integral multiples of $1,000 in excess thereof. The paying agent,
registrar and transfer agent for the Offered Notes will be the corporate trust
department of Bankers in The City of New York.
Reference should be made to the Prospectus for a description of other terms
of the Offered Notes and the information contained herein concerning the
Offered Notes is qualified by reference to the provisions of the Indenture,
including the definitions therein of certain terms. See "Description of Debt
Securities." Defined terms used but not defined in this Prospectus Supplement
have the meanings ascribed to them in the Prospectus.
OPTIONAL REDEMPTION
The Offered Notes may not be redeemed prior to June 15, 2000. On or after
such date all, but not less than all, of the Offered Notes may be redeemed at
the option of the Corporation semi-annually on each June 15 and December 15
upon at least 30 days' notice at par plus accrued interest to the date fixed
for redemption, all in accordance with the Subordinated Indenture.
BOOK-ENTRY SYSTEM
The Offered Notes will be issued in the form of one or more fully registered
Global Debt Securities (collectively, the "Global Security"), which will be
deposited with, or on behalf of, The Depository Trust Company, New York, New
York ("DTC"), as depository for the Global Security, and registered in the name
of DTC's nominee. Transfers or exchanges of beneficial interests in the Global
Security may be effected only through a participating member of DTC. Under
certain limited circumstances Offered Notes may be issued in certificated form
in exchange for the Global Security. See "Description of Debt Securities--
Global Debt Securities" in the Prospectus accompanying this Prospectus
Supplement. In the event that Offered Notes are issued in certificated form,
such Offered Notes may be transferred or exchanged at the offices described in
the second following paragraph.
Payment of principal of, and interest on, Offered Notes registered in the
name of DTC or its nominee will be made to DTC or its nominee, as the case may
be, as the registered owner of the Global Security. None of the Corporation,
the Trustee, any Paying Agent or any other agent of the Corporation or the
Trustee will have any responsibility or liability for any aspect of the records
relating to or payments made on account of beneficial ownership interests in
the Global Security or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests.
In the event that Offered Notes are issued in certificated form, principal
and interest will be payable, the transfer of the Offered Notes will be
registrable and Offered Notes will be exchangeable for Offered Notes bearing
identical terms and provisions at the office of the agent of the Corporation in
The City of New York designated for such purpose, provided that payment of
interest may be made at the option of the Corporation by check mailed to the
address of the person entitled thereto.
S-10
<PAGE>
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Offered Notes will be made by the Underwriter in
immediately available funds. All payments of principal and interest will be
made by the Corporation in immediately available funds or the equivalent, so
long as the Depository continues to make its Same-Day Funds Settlement System
available to the Corporation.
Secondary trading in long-term notes and debentures of corporate issuers is
generally settled in clearinghouse or next-day funds. In contrast, the Offered
Notes will trade in the Depository's Same-Day Funds Settlement System, and
secondary market trading activity in the Offered Notes will therefore be
required by the Depository to settle in immediately available funds. No
assurance can be given as to the effect, if any, of settlement in immediately
available funds on trading activity in the Offered Notes.
SUBORDINATION
THE OFFERED NOTES WILL BE SUBJECT TO THE SUBORDINATION PROVISIONS AS SET
FORTH IN THE SUBORDINATED INDENTURE AND DESCRIBED IN "DESCRIPTION OF DEBT
SECURITIES--SUBORDINATION--SUBORDINATED DEBT SECURITIES" IN THE PROSPECTUS AS
SUPPLEMENTED BELOW.
For the purposes of the Offered Notes, "Existing Subordinated Indebtedness"
means the Corporation's 6.00% Subordinated Notes due October 15, 2008, 7.50%
Convertible Capital Securities due 2033, Subordinated LIBOR/CMT Floating Rate
Debentures due 2003, Subordinated Floating Rate Notes due 2005, Subordinated
Constant Maturity Treasury Floating Rate Debentures due 2003, 7.25%
Subordinated Debentures due January 15, 2003, Subordinated Floating Rate Notes
due 2002, 7 1/8% Subordinated Debentures due July 31, 2002, 8 1/8% Subordinated
Debentures due May 15, 2002, 7.50% Subordinated Debentures due January 15,
2002, 9.00% Subordinated Debentures due August 1, 2001, 9.40% Subordinated
Debentures due March 1, 2001, 9.50% Subordinated Debentures due June 14, 2000,
Zero Coupon Subordinated Yen Notes due 1997-2004, Subordinated Floating Rate
Notes due 2004, 9.20% Subordinated Capital Notes due July 15, 1999,
Subordinated Money Market Capital Notes, Series A, B and C due 1999, 8%
Subordinated Debentures due March 15, 1997, 8 1/4% Subordinated Debentures due
July 2, 1996, 8 1/8% Subordinated Notes due 2002 and 8 1/4% Subordinated Notes
due 2005.
As of March 31, 1995, Senior Indebtedness and Other Financial Obligations of
the Corporation aggregated approximately $13 billion.
The Subordinated Indenture does not limit or prohibit the incurrence of
additional Senior Indebtedness, which may include indebtedness that is senior
to the Offered Notes but subordinate to other obligations of the Corporation,
including obligations of the Corporation in respect of Other Financial
Obligations.
EXPERTS
The consolidated financial statements of the Corporation for the year ended
December 31, 1994, appearing in the Annual Report on Form 10-K for the year
ended December 31, 1994, and incorporated by reference in this Prospectus
Supplement, the accompanying Prospectus and the Registration Statement, have
been audited by Ernst & Young LLP, independent auditors, as set forth in their
report thereon included therein and incorporated herein by reference. Such
consolidated financial statements are incorporated herein by reference in
reliance upon such report given upon the authority of such firm as experts in
auditing and accounting.
VALIDITY OF OFFERED NOTES
The validity of the Offered Notes will be passed upon for the Corporation by
Gordon S. Calder, Jr., Esq., a Managing Director and Counsel of Bankers, and
for the Underwriter by White & Case, New York, New York. White & Case performs
services for the Corporation from time to time. Mr. Calder has an interest in a
number of shares equal to less than 0.015 percent of the Corporation's
outstanding common stock. The foregoing supersedes "Validity of Offered
Securities" in the Prospectus.
S-11
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in an underwriting agreement
dated June 19, 1995 (the "Underwriting Agreement"), between the Corporation and
Merrill Lynch, Pierce, Fenner & Smith Incorporated (the "Underwriter"), the
Corporation has agreed to sell to the Underwriter, and the Underwriter has
agreed to purchase, the entire principal amount of the Offered Notes.
In the Underwriting Agreement, the Underwriter has agreed, subject to the
terms and conditions set forth therein, to purchase all the Offered Notes
offered hereby if any Offered Notes are purchased. The Corporation has been
advised by the Underwriter that the Underwriter proposes initially to offer the
Offered Notes to the public at the public offering price set forth on the cover
page of this Prospectus Supplement, and to certain dealers at such price less a
concession not in excess of 1.5% of the principal amount. The Underwriter may
allow, and such dealers may reallow, a discount not in excess of .5% of the
principal amount to certain other dealers. After the initial public offering,
the public offering price, concession and discount may be changed.
The Corporation has agreed to indemnify the Underwriter against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended.
The Corporation has been advised by the Underwriter that the Underwriter
presently intends to make a market in the Offered Notes, although the
Underwriter is under no obligation to do so and the Underwriter may discontinue
any such market making at any time in its sole discretion. Accordingly, no
assurance can be given as to the liquidity of, or the trading markets for, the
Offered Notes.
This Prospectus Supplement and the accompanying Prospectus may also be
delivered in connection with sales of the Offered Notes by affiliates of the
Corporation that have acquired such Offered Notes.
The Underwriter and certain of its associates and affiliates may be customers
of (including borrowers from), engage in transactions with, and/or perform
services for the Corporation and its subsidiaries (including Bankers) in the
ordinary course of business.
S-12
<PAGE>
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NO DEALER, SALESPERSON OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS, OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS, IN
CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS SUPPLEMENT AND THE
PROSPECTUS AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE CORPORATION OR THE
UNDERWRITER. NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT AND THE
PROSPECTUS NOR ANY SALE MADE HEREUNDER AND THEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
FACTS SET FORTH IN THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS OR IN THE
AFFAIRS OF THE CORPORATION SINCE THE DATE HEREOF. THIS PROSPECTUS SUPPLEMENT
AND THE PROSPECTUS ARE NOT AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO
BUY THE OFFERED NOTES OFFERED HEREBY IN ANY JURISDICTION IN WHICH IT IS
UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION.
----------------
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Bankers Trust New York Corporation......................................... S-2
Selected Consolidated Financial Data and Other Information................. S-9
Certain Terms of the Offered Notes......................................... S-10
Experts.................................................................... S-11
Validity of Offered Notes.................................................. S-11
Underwriting............................................................... S-12
PROSPECTUS
Available Information...................................................... 2
Incorporation of Certain Documents
by Reference.............................................................. 2
Bankers Trust New York Corporation......................................... 3
Use of Proceeds............................................................ 4
Description of Debt Securities............................................. 4
Foreign Currency Risks..................................................... 12
Description of Series Preferred Stock...................................... 13
Depositary Shares.......................................................... 16
Description of the Corporation's
Capital Stock............................................................. 18
Validity of Offered Securities............................................. 23
Experts.................................................................... 24
Plan of Distribution....................................................... 24
</TABLE>
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$75,000,000
BANKERS TRUST
NEW YORK CORPORATION
7 1/2% SUBORDINATED NOTES DUE 2010
----------------
PROSPECTUS SUPPLEMENT
----------------
MERRILL LYNCH & CO.
JUNE 19, 1995
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