Loan Pricing Corp.'s recent survey of lenders to middle-market companies shows that last year was a banner year for borrowing, nationwide. Compared with 1993 rates, loan prices dropped across the United States.

The loan prices are pegged to London Interbank Offered Rate (LIBOR) rather than to the prime rate, which tends to run about 250 basis points above LIBOR. "That's because over the past two years, LIBOR pricing has become more available to middle-market companies -- those with annual sales from $50 million to $125 million -- and, over time, it winds up being a better financial deal," notes Allen Dudley, an analyst at Loan Pricing's New York City headquarters. If your current borrowing is not tied to LIBOR, you may be able to lower costs by making the switch.

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LIBOR 1993/1994

(Numbers are the additional basis points paid above the LIBOR rate.)

Midwest 240/236

New England 217/212

Northeast 227/202

Northwest 228/222

South Central 208/196

Southeast 221/212

Southwest 235/207

Source: "Gold Sheets Middle Market," Loan Pricing Corp., January 1995, New York City.

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