BANKING & FINANCE - Nov. 9, 1994

Yields Rise in Treasury Auction: Yields on three-year notes rose to their highest level in four years as the government opened its $41-billion quarterly refunding. The average yield was 7.41%, up from 6.61% at the last auction Aug. 9. It was the highest rate since three-year notes sold for 7.78% on Nov. 6, 1990. The notes will carry a coupon interest rate of 7.375%, with each $10,000 in face value selling for $9,990.70. A total of $17.2 billion in notes were sold out of bids totaling $49.6 billion. The refunding continues today with the sale of $12 billion in 10-year notes and ends Thursday with the auction of $12 billion in 37-day cash management bills. The auctions are held four times a year to replenish government coffers drained by huge deficits.