Full text of H.16 Capital Market Developments : August 3, 1959
The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
Not f o r P u b l i c a t i o n DECONTROLLED' AFTER SIX MONTHS August 3, 1959o CAPITAL MARKET DEVELOPMENTS During the week ending July 31, l a r g e corporate o f f e r i n g s f o r new c a p i t a l t o t a l e d $35 m i l l i o n and l a r g e S t a t e and l o c a l government i s s u e s aggregated $122 m i l l i o n . This,week, the volume of p u b l i c securityf i n a n c i n g by S t a t e and l o c a l governments i s expected t o t o t a l $ll*6 m i l l i o n , i n c l u d i n g a $120 m i l l i o n Pennsylvania v e t e r a n s ' bond i s s u e . A u t i l i t y bond i s s u e f o r $15 m i l l i o n i s the only l a r g e corporate o f f e r i n g scheduled f o r s a l e t h i s week. Bond y i e l d s - Y i e l d s on outstanding bonds changed l i t t l e l a s t week. Y i e l d s on S t a t e and l o c a l government and U. S. Government o b l i g a t i o n s remained s t a b l e , while those on coroorate bonds d e c l i n e d s l i g h t l y , A new A~rated, f i r s t mortgage e l e c t r i c u t i l i t y i s s u e was o f f e r e d t o i n v e s t o r s l a s t week t o y i e l d 5 . 0 0 per cent—10 b a s i s p o i n t s lower than t h a t f o r the l a s t comparable i s s u e , an o f f e r i n g made on July 15. FNMA secondary market o p e r a t i o n s - A d d i t i o n a l pressures i n r e s i d e n t i a l mortgage markets were r e f l e c t e d by secondary market operations of t h e Federal National Mortgage A s s o c i a t i o n i n June. O f f e r i n g s rose f u r t h e r t o the h i g h e s t l e v e l i n 20 months, purchases were the l a r g e s t i n 17 months, and s a l e s remained n e g l i g i b l e . O f f e r i n g s t o FNMA i n the f i r s t half of 1959 exceeded $353 m i l l i o n , lU per cent above the t o t a l f o r the e n t i r e year of 1958. FNMA mortgage purchases of $225 m i l l i o n came w i t h i n 15 per cent of the annual t o t a l i n 1958, These f i r s t - h a l f o f f e r i n g s and purchases, however, were w e l l below comparable f i g u r e s i n the record 1957 p e r i o d . August s e c u r i t y volume •= The volume of new s e c u r i t y f i n a n c i n g f o r corporations and S t a t e and l o c a l governments i s expected t o be s e a s o n a l l y low i n August, but somewhat above the v e r y small volume of o f f e r i n g s made l a s t month and i n August of l a s t year. The August volume of corporate i s s u e s f o r new c a p i t a l i s e x pected t o t o t a l $650 m i l l i o n , o n e - s i x t h l a r g e r than the.volume i n both July t h i s year and August 1958. S t a t e and l o c a l government bond s a l e s during August are c u r r e n t l y estimated at $500 m i l l i o n , s l i g h t l y l a r g e r than the J u l y t o t a l and n e a r l y o n e - f o u r t h l a r g e r than the volume l a s t August. The August e s t i m a t e does not include the l a r g e Chesapeake Bay Ferry Commission i s s u e which may by s o l d by n e g o t i a t i o n sometime l a t e i n the month. Stock p r i c e s r Stock p r i c e s i n c r e a s e d f u r t h e r l a s t week. Standard and Poor's index of 500 common s t o c k s c l o s e d a t 6 0 . 5 1 on-July 31, s l i g h t l y below the peak of 60 o 62 reached on l a s t Wednesday. - 2 - Stock p r i c e s i n c r e a s e d sharply i n e a r l y J u l y , t h e n d e c l i n e d somewhat b e f o r e advancing again t o new h i g h s . The Standard and P o o r ' s index showed a n . i n c r e a s e of 3 . 5 per cent f o r t h e month. Trading a c t i v i t y was somewhat h i g h e r i n J u l y , p a r t i c u l a r l y e a r l y i n the month, than i n June. More d e t a i l e d i n f o r m a t i o n concerning r e c e n t c a p i t a l market developments i s p r e s e n t e d i n the attached e x h i b i t s . Capital Markets S e c t i o n , D i v i s i o n of Research and S t a t i s t i c s , Board of Governors of t h e F e d e r a l Reserve System. HIGH-GRADE LOWER-GRADE BOND BOND YIELDS YIELDS ll.lli Exhibit Is Tables l'or Exhibit A High-grade bond Y i e l d s Date Corporate Aaa 1 / Spread between U. S. Govt, and Corporate S t a t e and Aaa l o c a l Aaa S t a t e and l o c a l govt. Aaa y U. S. Govt, long-term 2/ (Per cent) 19514 - Low 1957 - High 1958 - High Low 1959 - High Low 2.85 it. lit U.13 3.55 U.U8 U.09 July July July July July U.U8 L.L8 U.JU7 hM6 k.k$ 3 10 17 2U 31 2/ (U/23) (9/27) (10/10) (5/2) (7/10) (1/9) 2.1,5 3.76 3.81* 3.07 It.13 3.83 (8/6) (10/18) (12/26) (lt/25) (7/10) (1/2) 1.90 3.U5 3.31 2.6U 3.^ •3.06 U.12 It. 13 I1.O8 It.10 It. 10 (9/2) (8/29) (9/11) (5/1) (7/2) (3/26) .30 .60 .51 .22 .39 .16 .36 .35 .39 .36 .35 3.5L 3.52 3.51 3.L8 3.18 .30 .ii7 .72 .3k .92 .57 .58 .61 .57 .62 .62 . Lower-grade Bond Y i e l d s Corporate Baa 1 / S t a t e and l o c a l govt. Baa y 195U - Low 1957 - High 1958 - High Low 1959 - High Low 3.Wt 5.10 lt.96 It. 51 5.09 1.83 2.93 it. 51 It. 31 3.61t lt.lt6 3.92 July July July July July 5.05 5.07 509 5.09 5.07 Date Spread between Aaa and Baa S t a t e and Corporate local govt. (Per cent) 3 10 17 2k 31 £ / . (12/31) (11/29) (1/3) (7/11) (7/2L) (lt/17) it.U6 1.1,5 h.li5 1.39 It.39 (8/5) (0/29) (9/11) (5/1) (7/2) (3/26) .52 1.27 1.20 .77 .77 .56 .57 .59 .62 .63 .62 .96 1.21 1.11 .93 .98 .86 - .92 .93 .9k .91 .91 2 / Preliminary. 1 / Weekly average of d a i l y f i g u r e s . Average term of bonds included i s 25-26 y e a r s . 2 / Weekly average of d a i l y f i g u r e s . The s e r i e s i n c l u d e s bonds due or c a l l a b l e i n 10 y e a r s or morn. 2 / Thursday f i g u r e s . Only general o b l i g a t i o n bondc are includedj average term i s 20 y e a r s . Note.—highs and lows are f o r i n d i v i d u a l s e r i e s and may be on d i f f e r e n t d a t e s f o r different series. STOCK MARKET FEDERAL NATIONAL SECONDARY MORTGAGE MARKET OPERATIONS OFFERINGS PURCHASES ASSOCIATION Exhibit. D - Tables f o r tixhibiL C Stock Maiiu-t Trading volume y yields 2/ (millions (per c e n t ) of sliares) Common Stock p r i c e indox 1 / Date Stock maiket customer c r e d i t Customers 1 Bank Total d e b i t b a l - l o a n s t o ances 4 / "others" 5 / (Mil]Lions of do]Liars) 1 9 r - 3 - l ? f 3 - High Low 191:9 Low 5U.11 (12/2!,/53) 22.92 (9/13/53) 60.51 ( 7 / 3 1 ) 51i.37(2/6) 3.30 6.25 3.03 3.3L h.9 0.9 U.3 2.6 U,b92 2,055 4, 721 4,527. 3,235 l,311i 3,li01 3,253 1,317 669 1,332 1 ,210 lay 57.96 57.L6 #.91 #.19 59.62 60.51 3.20 3.23 3.11 3. lit 3.12 3.03 3.4 2.9 3.7 3.1 3.0 3.0 ' 1,711 4,692 n.a. n.a. n.a. n.a. 3,335 3,338 n.a. n.a. n.a. n.a. 1,326 1,30k July July July July 10 17 2h 31 n / 1,243 r/1,256 1,271 n.a. n.a.--Not available. g/ Preliminary. 1 / S t a n d a r d and P o o r ' s <*"mposltc Index of 500 common s t o c k s , weekly c l o s i n g p r i c e s , 1941-43=10. Monthly d a t a a r e a v e r a g e s of d a l l y f i g u r e s r a t h e r t h a n of F r i d a y s ' o n l y . Highs and lows a r e f o r F r i d a y s ' d a t a o n l y . 2 / S t a n d a r d and P o o r ' s composite s t o c k y i e l d based on Wednesday d a t a c o n v e r t e d t o weekly c l o s i n g p r i c e s by F e d e r a l R e s e r v e . Y i e l d s shown a r e f o r d a t e s on which p r i c e index r e a c h e d i t s high or low. . 3 / Averages o f d a l l y t r a d i n g volume on t h e New York Stock Exoliange. 4 / End of month f i g u r e s f o r member f i r m s of t h e New York Stock Exchange which c a r r y margin a c c o u n t s ; e x c l u d e s b a l a n c e s secured by U. S . Government o b l i g a t i o n s . 5 / Wednesday f i g u r e s f o r weekly r e p o r t i n g member b a n k s . Excludes l o a n s f o r p u r c h a s i n g or c a r r y i n g U. S. Government s e c u r i t i e s * P r i o r t o J u l y 1 , 1959, auoh l o a n s a r e excluded only a t banks In New York and Chicago. Weekly r e p o r t i n g banks acco u n t f o r about 70 p e r c e n t of l o a n i t o o t h e r s . For f u r t h e r d e t a i l see B u l l e t i n . Federal National Mortgage A s s o c i a t i o n Secondaxy Market Operations 1 / Date Estimated O f f e r i n g s t o FNMA Standby Immediate Total purchase commitment Purchases by mm Sales hy FNMA ( M i l l i o n s of d o l l a r s ) 1953 - June July Aug. Sept. Oct. Nov. Dec. 1959 - J a n . Feb. Mar. Anr. May 9J1 9.6 10.1 23.8 57.3 10.7 39.7 37.7 44.4 52.4 57.3 30.6 8I1.U ^ 9.1 9.1 9.3 22.0 1,9.6 39.2 35.3 33.9 la. 2 49.3 50.1 73.U 76.6 .3 .5 .7 1.8 7.7 1.5 4.4 3.3 3.2 2.6 7.7 7.2 7 8 9.7 3.U 7.0 6.0 10.3 20.0 33.2 33.7 27.6 36.5 39.6 N U9.U - 171.3 L5.9 15. b 7.9 .3 1.1 .9 .3 .3 1.0 r/1.1 ~ .6 u i v n l l y rlo] 1 vcr w i t h i n one ymnr. Pin-chanes Include thooe under both immediate purohane and stnnd.by o o n t v n o t s . Cat*. cvclwlc FN11A a c t i v i t y under S p e c i a l A s s i o t a n o and Management and o o w | l w n t L i q u i d a t i n g Programs. Exhibit E 11. lit Long-term Corporate and S t a t e and Local Government Security O f f e r i n g s and Placements ( I n m i l l i o n s of d o l l a r s ) 1959 January Kebrua l y March 81*0 71*5 631 New c a p i t a l Corporate 1 / S t a t e and l o c a l 2/ 1958 ' 1 — 1 9 5 7 1 1958 1 1957 1 1959 728 857 1,5533/ 1,060 1,065 1,320 636 856 61*1* April May p/826 §/806 e/950 1,11*0 597 887 931 765 l,l»53 July August September e/550 e/6g.. 1,107 51t0 1,111* 1,003 92k 973 662 518 920 1,090 789 1,076 2,216 g/2,582 3,139 2,623 2,760 2,300 3 ,1*1*5 3,11*9 2,899 2,951 2/1,798 5,762 8,522 10,823 October November December 1st 2nd 3rd hth quarter quarter quarter quarter 1 s t half Three quarters Year 6,591* 9,1,93 12,1*1*7 Excluding f i n a n c e companies h/ 1st 2nd 3rd hth quarter quarter quarter .quarter 2.011 e/2,332 Year 2,899 2,5# 2,731 2,213 3,237 2,889 2,582 2,810 10,129 11,518 812 953 . 511 71*2 572 506 * 930 592 2/980 798 895 551 765 51*6 393 ' e/1*75 e/ 530 806 1*03 651 529 581* 1*31 1*56 1*71* 1*35 698 633 698 2,136 9/2,502 2,276 2,21*1* 1,860 1,365 1,820 1,701* 1,51*1* 2,029 e/b,638 It,520 6,380 7,71*6 3,521* 5,069 7,099 • - 1 / S e c u r i t i e s and Exchange Commission estimates of net proceeds. 2 / Investment Bankers A s s o c i a t i o n of America e s t i m a t e s of p r i n c i p a l amounts, 3 / Includes #713.2 m i l l i o n AT&T convertible debenture i s s u e , h j Total new c a p i t a l i s s u e s excluding o f f e r i n g s of s a l e s and consumer f i n a n c e companies. |; 11, Exhibit F Other Security O f f e r i n g s 1 / ( I n m i l l i o n s of d o l l a r s ) Long-term Forei<m government 2 / Federal agencji' 3 / 1956 19^9 19# 1957 1 1957 1 1958 I January February March » 1,163 251 77 59 2 197 54 — . it 9 30 56 50 139 200 120 123 48 42 523 July August September 9 5 . 17 28 7 30 16k October November December 57 123 74 4 60 1 k20 507 2,321 April May Year 995 199 72 175 — 125 60 — 215 — 100 — Short-'term S t a t e and l o c a l government h / — 572 Federal agency 3 / 190 .1*28 - 233 1*60 273 326 155 147 359 500 489 371 208 144 638 430 505 April May 563 Jill 357 354 264 205 337 153 486 675 28? 209 161 3# 336 169 501 July August September 289 123 369 272 272 252 137 206 330 22k 370 512 October November December 231 415 2k3 303 94 459 454 114 137 1,236 255 116 3,0?8 5,543 1, January February March Year 3,910 3,27k 1 / Data p r e s e n t e d i n t h i s e x h i b i t d i f f e r from t h o s e i n E x h i b i t E i n t h a t refundi n g i s s u e s , a s w e l l as new c a p i t a l i s s u e s , are i n c l u d e d . Long-term s e c u r i t i e s are d e f i n e d a s t h o s e maturing i n more than one y e a r . 2 / Includes s e c u r i t i e s o f f e r e d i n the United S t a t e s by f o r e i g n governments and t h e i r s u b d i v i s i o n s and by i n t e r n a t i o n a l o r g a n i z a t i o n s . Source: S e c u r i t i e s and Exchange Commission. y I s s u e s not guaranteed by the U. S. Government. Source: long-term, S e c u r i t i e s and Exchange Commission; short-term, Federal Reserve. h / P r i n c i p a l l y t a x and bond a n t i c i p a t i o n n o t e s , warrants or c e r t i f i c a t e s and P u b l i c Housing Authority n o t e s . In some i n s t a n c e s PtiA n o t e s included may have a somewhat Digitized FRASER l o n gfor e r term than one year. Source: Bond Buyer. H.ll* Exhibit G Large Long-term Public S e c u r i t y I s s u e s f o r New C a p i t a l (Other than U. S. Tre'asury) l / Proceeds of Large I s s u e s O f f e r e d ( M i l l i o n s of d o l l a r s ) Corporate Month S t a t e and l o c a l government 281 771 209 825 259 227 305 369 3UO 215 359 3U2 28U 1958 - June July August September October November December 1959 - January February March April May Other 2 / 86 itl 195 275 109 288 172 259 229 335 551 369 563 258 635 18 209 100 79 17U 35 176 20 50 60 Large I n d i v i d u a l I s s u e s Offered during July Type 3 / issuer CORPORATE Coupon Amount (millions Maturity net i n t e r of est cost dollars) Offering Rating yield - Long I s l a n d L i g h t i m Tennessee Gas Trans, . T r a n s c o n t . Gas ?. L,. T r a n s c o n t . Gas P. L,. Co. Con. Corp. Com. 1 s t ntg. V«ds. 1 s t ntg.p.Lbds. Pfd. s t k . 1 s t -it >p.Lbds. 25.0 £0.0 15.0 20.0 1999 1979 5 l/h 5 l/h 5.10 5.15 A A 19% 5 1/3 5.15 Baa ite-f. ?ut. l e t ; - S . T. dev. - J . U t . Rev. - , r t . TT .- t, G. 10.0 31.0 1-3.0 12.5 31l.o 15.2 1963-79 1963-72 n.a. ^ I f f l - W 1995/6b 1960-73/71 STATE AMD LOCAL COVIrtMv,:-?T TT niv. of Texas, <Ur. "lech. C o l l e g e of Texas S t a t e of Ohio T Jniv. of Cti] i f o r n i a T e r r i t o r y of " a v a i i C a l i f . T o l l Bri'-V.re Au t h . Corrvnonwealth of Pnar •to Rico 0. 3.U7 3.51 2.33 L.33 L.36 3.91 2.L0-3.50. 2.1x0-3.SCfii Aa n.a. 3.oo_!i.35 A —— )».29 2.:0-!,.0l A 0-2 H.lU Large I n d i v i d u a l I s s u e s O f f e r e d during J u l y Type 3 / Coupon rate O f f e r i n g Amount ^ m i l l i o n s Maturity or n e t M b p yield e s t cost of d o l l a r s Rating STATE AND LOCAL GOVERNMENT (Cont 1 d) S t a t e of Vermont Michigan Highway Dent. Jefferson Par.S.D.No.l,La. 0.0. Rev.-S.T. G'.O. 13.0 5D.0 10.0 1960-79 1961-85 I96O-89, 3.10 It.29 lr. 58 2.30-3.20 3.00-U.25 2.90-U.60 Aaa A — OTHER Quebec Hydro-Elec. Coiran. Deb. 50.0 198U 5.00 n.a.—Not available. 1 ( I n c l u d e s corporate and o t h e r s e c u r i t y o f f e r i n g s of $15 m i l l i o n and over; S t a t e and l o c a l government s e c u r i t y o f f e r i n g s of $10 m i l l i o n and o v e r . 2 / I n c l u d e s f o r e i g n government and I n t e r n a t i o n a l Bank f o r Reconstruction and Development i s s u e s and non-guaranteed i s s u e s by F e d e r a l a g e n c i e s . 3 / In t h e c a s e of S t a t e and l o c a l government s e c u r i t i e s , 0 . 0 . denotes general o b l i g a t i o n s ; R e v . - U t . , revenue o b l i g a t i o n s secured o n l y by income from p u b l i c u t i l i t i e s ; R e v . - Q . U t . , revenue bonds secured only by revenue from q u a s i - u t i l i t i e s ; R e v . - S . T . , revenue bonds s e c u r e d by revenue from s p e c i f i c t a x e s o n l y ; R e v . - R e n t , , revenue bonds secured s o l e l y by l e a s e payments. / I4/ 1972 m a t u r i t i e s n o t r e o f f e r e d . lixhibit H ii.llt Forthcoming Largu Long-term Public S e c u r i t y O f f e r i n g s f o r New C a p i t a l (Other than U. ti. Treasury) 1 / Expected Proceeds from Forthcoming Large I s s u e s Bate of computation 1?5H - June 30 J u l y 31 Aug. 29 S e p t . 30 Oct. 31 Nov. 28 Dec. 31 1959 - Jan. 30 Feb. 27 Mar. 31 Apr. 30 May 29 J i me 30 J u l y 31 During month f o l l o w i n g date shown S t a t e ancT TOther 2 / Corporate l o c a l govt. ?6U 161 70S 113 20h 301 210 270 1' 8 396 2h6 287 165 239 Subsequent t o d a t e shown Corporate S t a t e and Other 2 / local govt. 225 55 21a 250 229 261 55i 292 550 25ii 247 Iho 71 75 15 20 50 50 i,oU8 381 91k 216 326 U01 370 365 279 h 76 316 33^ 272 235 125 135 52h 675. 683 515 856 i*8l 761 517 761 500 J1O6 71 75 hS 20 50 50 Fort!,coming Large O f f e r i n g s , a s of July 31 Type Amount Approximate d a t e (millions of oJ i e r i n g of d o l l a r s ) P e n n s y l v a n i a E l e c t r i c Co. Northern S t a t e s Power Co. 1 s t ntg b d s . Com. s t k . 15.0 20.9 Michigan B e l l Telephone Co. Pan American World Air -iys, I n c . Deb. Conv. sub. deb 30.0 1l7.0 -^Consumers Power Co. "ouston L i g a t i n g < Power Co. P a c i f i c Gas 1: E l e c t r i c Co. American and Forei-.n Power Co. Commerce O i l R e f i n i n g Corp. STA.TE A D LOOM, 1 1 s t mtg. b d s . 1 s t mtg. b d s . 1st r e f . it?, b d s . Conv. j r . deb. D e b . , b d s . "z common 35.3 25.0 65.0 22.5 hS.O Aug. it Aug. 11 ( r i - ats exoire) A u . 12 Au ?r. 12 (rights nxoirc) Au=;. 19 Au f 21 25 Su^n.^r Sumner SNT Co7irionwnalth o f P e n n s y l v a n i a Los A n g e l e s Sch. D i e t s . , C a l i f . S t a t e of Ohio Texas W a t e r Development Board -*Nassau C o . , New York C h e s a p e a k e nay F e r r y Commission Tbruvray A u t h o r i t y Digitizedl!ew forYork FRASER 0.0. G.O. G.O. G.O. 3.0. Rev.-Ut. Rev.-Ut. 120.0 26.0 30.0 10.0 26.2 lM-.O 50.0 An T . h HU-*. h Aug. 11 Aug. 12 •m-. 12 -ummnr Sumner H.lU Forthcoming Large O f f e r i n g s , as of J u l y 31 (Cont'd) Type Amount , (millions of d o l l a r s ) Approximate date of o f f e r i n g OTHER *—Included i n t a b l e f o r f i r s t t i m e . 1 / Includes corporate and other i s s u e s of $15 m i l l i o n and over; S t a t e and l o c a l government i s s u e s of $10 m i l l i o n and over. 2 / Includes f o r e i g n government and I n t e r n a t i o n a l Bank f o r Reconstruction and Development i s s u e s and non-guaranteed i s s u e s by Federal a g e n c i e s . N o t e . — D e l e t i o n s f o r reasons other than s a l e of i s s u e : None. U.I)!Y i e l d s on New and O u t s t a n d i n g E l e c t r i c Power Bonds, h a t e d Aa an-i A 1 / A-rated o f f e r i n g y i e l d s Aa-rated offering; y i e l d s Amount above Amount above Actual Actual s e a s o n e d y i e l d s ( p e r cent) seasoned y i e l d s (per cent) (basis points) (basis points) 1952 - 1958 High Low 1959 - Jan. 7 20 28 Feb. 18 Mar. 11 25 26 31 Apr. 3 15 16 29 May 1 13 lb 20 21 26 17 26 July 9 10 15 30 5.00 (9/11/57) 2.93 (3/31/5W B b.60 b.b3 b.hl L.6o 87 -3 3b ho b 11 9 9 13 t:|2/ 22 21 7 1.95 1.95 36 3L 5.oo 38 29 k.9S 5.50 (11/7/57) 3.00 ( 3 / 1 7 M ) 123 -15 1.75^/ 23 h.6 7 18 L85 5.06 17 13 5.13 27 h.9 ^ 5.10 5.10 6 2b 19 5.10 5.00 19 13 1.93 * — S i n g l e o b s e r v a t i o n , n o t an a v e r a g e . 1 / Covers o n l y 3 0 - y e a r f i r s t mortgage bonds, a s r e p o r t e d i n Moody's Bond Survey. Except where i n d i c a t e d , the a c t u a l y i e l d f i g u r e and the amount above s e a s o n e d y i e l d s a r e a v e r a g e s o f o f f e r i n g s during t h e i n d i c a t e d p e r i o d and o f t h e d i f f e r e n c e s between t h e s e new o f f e r i n g y i e l d s and y i e l d s on s e a s o n e d i s s u e s o f s i m i l a r q u a l i t y f o r the same day. Average maturity f o r t h e s e a s o n e d i s s u e s v a r i e s from 26 t o 28 y e a r s . 2 / P r o v i d e s f o r a 5 - y e a r p e r i o d during which i s s u e may not be c a l l e d f o r r e f u n d i n g a t a l o w e r coupon r a t e . Monthly a v e r a g e s so marked i n c l u d e one o r more i s s u e s w i t h s uc h a p r o v i s i o n . Other i s s u e s have no such p r o v i s i o n . 3/ P r o v i d e s f o r a 7 - y e a r p e r i o d during which i s s u e may n o t be c a l l e d f o r r e f u n d i n g a t a lower coupon r a t e .