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Not f o r P u b l i c a t i o n DECONTROLLED AFTER SIX MOUTHS H.lU September 20, 1956 CAPITAL MARKET DEVELOPMENTS The volume of p u b l i c l y s o l d s e c u r i t y i s s u e s was l a r g e l a s t week, p a r t i c u l a r l y f o r c o r p o r a t e s e c u r i t i e s , and i s expected to. be o n l y m o d e r a t e l y s m a l l e r t h i s week. During t h e week ending September lU, c o r p o r a t i o n s s o l d l a r g e i s s u e s t o t a l i n g $20U m i l l i o n , while S t a t e and l o c a l government f l o t a t i o n s amounted t o $71 m i l l i o n . This week f o u r c o r p o r a t e s e c u r i t y o f f e r i n g s with p r o c e e d s of $180 m i l l i o n and f o u r tax-exempt i s s u e s t o t a l i n g <8>61t m i l l i o n a r e scheduled for sale. Bond y i e l d s - Y i e l d s on c o r p o r a t e , A a a - r a t e d S t a t e and l o c a l government and U. S. Government (new s e r i e s ) bonds c o n t i n u e d t o i n c r e a s e l a s t week, b u t a t a more moderate pace t h a n e a r l i e r . Y i e l d s on B a a - r a t e d S t a t e and l o c a l government bonds remained s t a b l e , w h i l e y i e l d s on U. S. Government ( o l d s e r i e s ) and S t a t e and l o c a l revenue bonds d e c l i n e d one b a s i s p o i n t . The $75 m i l l i o n CIT F i n a n c i a l C o r p o r a t i o n ' s d e b e n t u r e i s s u e , which had been postponed f i r s t i n e a r l y June and again i n A u g u s t , came t o t h e market on September 19. The d e b t s e c u r i t i e s c a r r i e d a coupon of Ij. 1 / 2 p e r c e n t and c a r r i e d a 1 0 - y e a r n o - c a l l p r o v i s i o n , w h i l e i n August terms of a U p e r c e n t coupon had been d i s c u s s e d . The i s s u e was r e o f f e r e d t o y i e l d a . 3 8 p e r c e n t a s comp a r e d w i t h a y i e l d of 3.75 p e r cent on a s i m i l a r o f f e r i n g made by t h e company l a s t September. The i s s u e was s o l d r a p i d l y and went t o a s l i g h t premium. A l a r g e r a i l r o a d bond o f f e r i n g was w e l l r e c e i v e d by t h e market a t a r e o f f e r i n g y i e l d of 5 . 2 5 p e r c e n t f o r a 27-year f i r s t mortgage bond r a t e d Baa. T h i s i s only t h e second s i z a b l e l o n g - t e r m new c a p i t a l f i n a n c i n g t h r o u g h bond i s s u e s by r a i l r o a d s i n t h e l a s t f i v e y e a r s ; most r a i l r o a d equipment e x p e n d i t u r e s have been f i n a n c e d t h r o u ^ i equipment t r u s t c e r t i f i c a t e s of s h o r t e r m a t u r i t y on t h e a v e r age. One l a r g e i n d u s t r i a l i s s u e was postponed t h i s week because of " u n f a v o r a b l e market c o n d i t i o n s . " A s u b s t a n t i a l p o r t i o n of t h e i n t e n d e d borrowing of $20 m i l l i o n was f o r r e f u n d i n g p u r p o s e s . Stock market c r e d i t - Customer c r e d i t i n t h e s t o c k market (excluding U. S. Government s e c u r i t i e s ) d e c l i n e d $1*7 m i l l i o n d u r i n g August, t o t o t a l $3,979 m i l l i o n a t t h e end of t h e month. A $27 m i l l i o n d e c r e a s e i n n e t d e b i t b a l a n c e s more t h a n o f f s e t t h e J u l y i n c r e a s e . Bank l o a n s t o " o t h e r s " continued t o d e c l i n e . Borrowing by member f i r m s of t h e NYSE m a i n t a i n i n g margin a c c o u n t s , except borrowings — 2 on U. S. Government s e c u r i t i e s , declined $163 m i l l i o n , p r i n c i p a l l y i n borrowing on customer c o l l a t e r a l . This i s t h e l a r g e s t monthly change since March of 1955 when such borrowing increased by #l?li m i l l i o n . These and other data on stock market c r e d i t a r e shown i n the following t a b l e . End of month July August Change (Millions of d o l l a r s ) Customer c r e d i t Excluding U. S. Govt, s e c u r i t i e s - Total . Net d e b i t balances Bank loans to "others" Net d e b i t balances secured by U. S. Govt, s e c u r i t i e s Bank loans to. o th e rs f o r purchasing or carrying ' U. S. Govt, s e c u r i t i e s Broker and d e a l e r c r e d i t Money borrowed except on U. S. Govt, s e c u r i t i e s On customer c o l l a t e r a l Money borrowed on U. S. Govt, s e c u r i t i e s Customers 1 - net f r e e c r e d i t balances 3,979 2,785 1,19k 33 2*,026 2,812 1,21k 31 -1*7 -27 -20 2 la us. -U 2,Oli8 l,7li2 38 872 r/2,211 1,873 31 858 -163 -131 7 1U r / Revised. The decline in brokers l o a n s reported by weekly r e p o r t ing member banks was much g r e a t e r t h a n t h e drop in margin f i r m b o r rowings, a s i s shown in t h e c h a r t on the next page, and, a s a r e s u l t , the outstanding amount of brokers loans was s u b s t a n t i a l l y below t h e margin f i r m s ' borrowings t o t a l f o r t h e f i r s t time s i n c e t h e s t a t i s t i c a l s e r i e s was begun i n 1938. D i f f e r e n c e s i n coverage between the s e r i e s makes i t d i f f i c u l t t o i d e n t i f y s p e c i f i c a l l y t h e cause of t h i s change i n r e l a t i o n s h i p . The brokers loan s e r i e s excludes borrowing on U. S. Government s e c u r i t i e s a t New York and Chicago banks, but i n cludes such borrowing a t o t h e r r e p o r t i n g banks. The margin f i l m s e r i e s excludes a l l borrowing on Government s e c u r i t i e s . This d i f f e r e n c e i s presumed t o be s l i g h t . More importantly, the brokers loan s e r i e s i s more e x t e n s i v e in coverage of borrowers, s i n c e i t includes loans t o both margin and non-margin firms', while the margin f i r m s e r i e s i s more extensive i n coverage of l e n d e r s , in t h a t i t includes borrowing by margin f i r m s from both weekly r e p o r t i n g and other commercial banks, a s well a s a small amount of borrowing from nonbank l e n d e r s . BROKER BORROWINGS B i l l i o n s of d o l l a r s 2.6 / 2.k A \ \ \ /z 2.2 Brokers Loans \ Margin Firm Borrowings July Sept. 1955 Nov. Jan. Mar. May July 1956 Note.—Data a r e f o r the l a s t Wednesday of the month. Brokers loans a r e weekly r e p o r t i n g member bank loans t o brokers and d e a l e r s f o r purchasing or c a r r y i n g s e c u r i t i e s , except t h a t loans a t New York and Chicago, r e p o r t i n g banks f o r purchasing or carrying U. S. Government s e c u r i t i e s a r e excluded. Margin f i r m borrowing i s t h a t of NYSE member f i r m s which carry margin accounts, except borrowing secured by U. S. Government s e c u r i t i e s , as r e p o r t e d to the NYSE by t h e s e firms. In l i g h t of t h e s e s t a t i s t i c a l d i f f e r e n c e s , the changed r e l a t i o n s h i p between t h e s e r i e s could r e s u l t from a decline in nonmargin f i r m borrowing a t weekly r e p o r t i n g banks, or a d i v e r s i o n of brokers loans from weekly reporting banks to o t h e r banks or o t h e r l e n d e r s , or varying combinations of both. There a r e no measures of non-margin f i r m borrowing a t weekly reporting banks or of s e c u r i t y - k l o a n s by nonbank l e n d e r s , but i t i s not l i k e l y t h a t changes i n e i t h e r of t h e s e f a c t o r s have been l a r g e enough t o account "for the marked change i n the two a v a i l a b l e s e r i e s . In l i g h t of p r e s s comment and other r e p o r t s from the " f i n a n c i a l community, the changes probably r e f l e c t a s u b s t a n t i a l s h i f t i n g of brokers loans from main f i n a n c i a l c e n t e r s t o non-reporting banks. Stock p r i c e s - Common stock p r i c e s , a s measured by the SBC index of 265 s t o c k s , d e c l i n e d 3.8 p o i n t s during the week ending September 1h, closing a t 281.3. Daily f i g u r e s through Wednesday of t h i s week i n d i c a t e a f u r t h e r sharp d e c l i n e i n p r i c e s . Corporate S e c u r i t y O f f e r i n g s i n t h e Second Quarter 1956 Net Proceeds f o r New C a p i t a l During the second q u a r t e r of 1956, corporations obtained . almost &,2.8 b i l l i o n in new c a p i t a l through i s s u i n g s e c u r i t i e s of a l l t y p e s , as can be seen from Table 1. This was t h e l a r g e s t v o l ume of o f f e r i n g s in any q u a r t e r tin record, exceeding the corresponding q u a r t e r of 1955 by 36 p e r c e n t . The most s i g n i f i c a n t c o n t r i b u t i o n t o t h i s i n c r e a s e was made by manufacturing companies which raised' 60 per cent more new money t h i s q u a r t e r than in 1955 and accounted f o r more than onet h i r d of a l l corporate o f f e r i n g s . Largest i n c r e a s e s were experienced i n the machinery, petroleum and paper manufacturing subgroups. The General E l e c t r i c &300 m i l l i o n debenture i s s u e i n May was p r i m a r i l y responsible f o r the heavy new f i n a n c i n g i n machinery—the l a r g e s t f o r any recent second q u a r t e r . Sharpest d e c l i n e s were r e g i s t e r e d i n n e t new f i n a n c i n g by primary iron and s t e e l and rubber producers; new o f f e r i n g s by t h e s e groups had been unusually l a r g e l a s t year due t o l a r g e i s s u e s by Bethlehem S t e e l and Goodyear T i r e and Rubber. E l e c t r i c , gas and water companies r a i s e d $860 m i l l i o n i n new c a p i t a l — u p 29 p e r cent from l a s t year but somewhat below n e t new f i n a n c i n g i n t h e second q u a r t e r s of 1953 and 195b. This was t r u e d e s p i t e a considerable i n c r e a s e i n p l a n t and equipment expenditures t h i s y e a r . tJhen communications and other u t i l i t i e s a r e included, public u t i l i t i e s received n e a r l y t w o - f i f t h s of the n e t new c a p i t a l r a i s e d by domestic c o r p o r a t i o n s , n e a r l y o n e - t h i r d more than a year e a r l i e r . F i n a n c i a l and r e a l e s t a t e companies, with a t o t a l of # 6 2 m i l l i o n , ranked t h i r d i n importance, with the l a r g e s t i n c r e a s e (i;8 per c e n t over t h e same q u a r t e r of the preceding year) being accounted f o r by consumer f i n a n c e companies. Railroad i s s u e s — almost e x c l u s i v e l y i n the form of equipment t r u s t c e r t i f i c a t e s were up sharply from t h e exceedingly low l e v e l of preceding years but s t i l l accounted f o r only 3 p e r cent of a l l new f i n a n c i n g . H.lU - 5 Table 1 Corporate S e c u r i t y O f f e r i n g s f o r New C a p i t a l by Type of Business of I s s u e r Second Quarter (Net proceeds i n m i l l i o n s of d o l l a r s ) A l l corporate o f f e r i n g s Manufacturing Machinery Petroleum Paper Foods Chemicals T e x t i l e s and apparel Primary i r o n and s t e e l Motor v e h i c l e s and equipment Rubber Primary nonferrous metals Other 1 / E l e c t r i c , gas and water u t i l i t i e s Communication Railroad Other t r a n s p o r t a t i o n 1952 19# 1955 195k 1953 2,789 2,052 1,995 2,578 999 375 139 108 k$ 28 21 20 lk 11 2 235 628 "37 22 18 22 22 1 207 18 68 23 160 . 860 669 9k0 106 68 lk 57 100 83 35 27 62 102 109 ^92 91 89 - 188 H W 10 k* ks 70 2 15 3 1 122 • 9 6 2,629 668 "69 212 53 lit 218 5 10 S 2/ 11 91 lz±12 273 1U9 3k 31 312 16 UU 919 830 Commercial and other 7k 77 59 k7 ) Mining 97 118 13k 69 ) 1*62 270 97 • 95 363 IBS 59 122 122 *E 11 27 F i n a n c i a l and r e a l e s t a t e Consumer f i n a n c e companies Banks Other ) 666 ZoS 2k 36 77 101 75 137 161 US 36 9 1 / Includes small volume of. f o r e i g n i s s u e s not f u r t h e r c l a s s i f i e d i n t h e manufacturing group. J2/ Less than $500,000. ' , Note.—Details mf.y not add t o t o t a l s due t o rounding. S o u r c e . — S e c u r i t i e s and Exchange Commission and Federal Reserve. - - 6 *Ui- - T o t a l Gross Proceeds Table 2 shows t h a t t o t a l gross proceeds from the s a l e of new s e c u r i t y i s s u e s — i n c l u d i n g refunding and the cost of f l o t a t i o n t o t h e i s s u i n g companies—amounted t o n e a r l y S3 b i l l i o n as compared with l e s s than $2.5 b i l l i o n during the comparable q u a r t e r l a s t y e a r . Of a l l new i s s u e s , k3 p e r cent were p u b l i c l y o f f e r e d bondsj p r i v a t e l y placed bond i s s u e s made up another 3U per c e n t . Thus more than t h r e e - q u a r t e r s of a l l new c a p i t a l r a i s e d during the second q u a r t e r took the form of bonded indebtedness. P r e f e r r e d stock accounted f o r only 5 per cent of new corporate i s s u e s , and the remaining 18 p e r c e n t took the form of common stock. Equity financing r e p r e s e n t e d a smaller proportion of t o t a l corporate f i n a n cing than occurred during t h e second q u a r t e r of 1955 but was c l o s e l y comparable to t h e p a t t e r n f o r e a r l i e r y e a r s . Table 2 • T o t a l Corporate S e c u r i t y Offerings, by Type of I s s u e Second Quarter (Gross proceeds in m i l l i o n s of d o l l a r s ) Type o f - i s s u e 1956 1955 195U 1953 1952 T o t a l corporate o f f e r i n g s 2,98 9 2,1*13 2,531 2,695 2,888 Type of o f f e r i n g Public Private 1,93k 1,055 1,667 7hS 1,603 928 1,812 883 1,769 1,119 Type of s e c u r i t y Bonds and notes Public Private 2,316 1,296 1,020 1,613 9h8. 695 1,860 980 879 2,100 1,237 863 2,2U6 1,153 1,093 P r e f e r r e d stock UU7 208 370 150 227 Common stock 526 562 302 bhS Ui5 Note.—Details may not add t o t o t a l s due t o rounding. S o u r c e . — S e c u r i t i e s and Exchange Commission. One-eighth of the new s e c u r i t i e s o f f e r e d were c o n v e r t i b l e issues—predominantly bonds. As can be seen from Table 3, t h i s r e p r e s e n t s a s l i g h t d e c l i n e from t h e second q u a r t e r l a s t y e a r , but g r e a t l y exceeded t h e comparable t o t a l f o r 195>it. -7 Table 3 New Convertible I s s u e s Second Quarter (Thousands of d o l l a r s ) 1956 1955 / 195 U 371,323 25,9li6 15,205 63,97k Bonds P r e f e r r e d stock Corcmon stock 336,060 32,981 1.73k Total of which refunding 370,775 397,269 79,179 to,118 23,256 3,995 , : The r e l a t i v e importance of d i f f e r e n t types of f i n a n c i n g v a r i e d sharply according to i n d u s t r y groups. Table h shows t h i s p i c t u r e i n d e t a i l . Corporations i n a l l i n d u s t r i a l groups r a i s e d a t l e a s t h a l f of a l l new c a p i t a l during the second q u a r t e r through debt i s s u e s , but t h e degree of r e l i a n c e on debt d i f f e r e d widely by i n d u s t r y . Railroad f i n a n c i n g , f o r example, took the form of bond i s s u e s e x c l u s i v e l y ; 85 per cent of new manufacturing f u n d s and '82 per c e n t of new c a p i t a l r a i s e d by public u t i l i t i e s were derived from t h i s source. The r e a l e s t a t e and f i n a n c e group and commercial e s t a b l i s h m e n t s , on the o t h e r hand, r e l i e d much more heavily upon common stock i s s u e s , a c q u i r i n g over 3h p e r cent and h i p e r cent r e s p e c t i v e l y , of t h e i r new c a p i t a l i n t h i s form. Together, t h e s e two groups accounted f o r over half of a l l common stock o f f e r i n g s . All r a i l r o a d bonds were p u b l i c l y i s s u e d ; public u t i l i t i e s a l s o r e l i e d heavily upon p u b l i c l y o f f e r e d bonds, deriving f>7 p e r cent of a l l new funds from t h i s source as compared with 2$ p e r cent from p r i v a t e placements. Manufacturing concerns secured approximately half t h e i r requirements through p u b l i c bond i s s u e s , but made extens i v e use of p r i v a t e placements as w e l l ; a t t h e other extreme, the r e a l e s t a t e and f i n a n c i a l group secured more than half of a l l new c a p i t a l through p r i v a t e l y i s s u e d bonds. For a l l c a t e g o r i e s , new i s s u e s of p r e f e r r e d and common stock were predominately p u b l i c o f f e r ings. More d e t a i l e d information concerning r e c e n t c a p i t a l market developments i s presented i n t h e a t t a c h e d e x h i b i t s . Business Finance and Capital Markets S e c t i o n , Division of Research and S t a t i s t i c s , Board of Governors of the Federal Reserve System. - 8 - Table h R e l a t i v e Importance of I n d u s t r i a l Groups and Types of Instrument i n Net New Financing 2nd Quarter 1956 Railroads Public utilities Manufacturing Commerc i a l and miscellaneous Real estate and finance Total (Percentage d i s t r i b u t i o n , by i n d u s t r y ) - Bonds Public . Private Sub-total 100 57 25 h9 36 82 ~85 — 6 1 y — 7 h 11 y 10 1 ii 11 . 100 P r e f e r r e d stock Public Private Sub-total . Common stock Public Private Sub-total Total 100 100 100 7 13 52 Ui 3k **51 "65 ™78 a 2 h 1 1 5 y 16 1 "U7 3h "l7 100 100 100 ~ 1*6 1 3 (Percentage d i s t r i b u t i o n , by type of instrument) T o t a l bonds Public Private . T o t a l p r e f e r r e d stock . Public Private T o t a l common stock Public Private h 6 - - hO h9 28 1 39 39 38 h 1 8 lit 5 26 100 100 100 35 39 5 2 3 5 2 29 100 100 100 2k 25 6 2U 22 70. 17 3U 36 8 100 100 100 1 / Less than 0 . 5 p e r c e n t . Note.—Details may n o t add to t o t a l due to rounding. 11 H I G H - G R A D E B O N D YIELDS CORPORATE Aaci \ u . S. G O V E R N M E N T : / / \ / ' V ~ i °'° " STATE AND LOCAL GOVERNMENT A a a U. S. Govt., long-term 2/ Corporate Aaa 1 / Old s e r i e s New s e r i e s Spread between State and U. S. Govt. l o c a l govt. (old s e r i e s ) and Aaa y Corporate!State and Aaa Ilocal Aaa (Per cent) 1953 - High Low 195k - High 1955 - High 1956 - High August 17 August 2It August 31 September 7 September lit 3.U2 (6/19) 2.99 ( 1 / 9 ) 3.09 (1/8) 2.85 (U/23) 3.17 (12/23) 2.91 (1/7) 3.55 ( 9 M ) 3.07 (3/2) Hi 3.U9 3.15 (6/6) 2.78 (12/26) 2.7U 2. It It 2.9b 2.62 3.22 2.80 (1/9) (8/7) (8/5) (1/7) (9/7) (2/17) 3.1b 3.21 3.21 -3.22 3.21 1 / Weekly average of d a i l y f i g u r e s . 2.73 (6/25) 1.98 (1/8) 2.21 (6/10) n.a. 3.03 (8/5) 2.89 (6/10) 3.26 (9/llt) 2.92 (2/3) 1.90 2.3U 2.05 2.63 2.17 3.18 3.23 3.23 ::: ill 2.53 2.62 2.63 (9/2) (9/8) (5/26) (9/13) (2/23) .38 .81 % .61 3 :io .13 1 .1*5 .32 .3lt .28 .26 .28 .31 • 3U .30 .29 .61 .62 $ Average term of bends included i s 25-26 2 / Weekly averages of d a i l y f i g u r e s . The old s e r i e s includes f u l l y taxable, ' marketable 2 1/2 per cent bonds due or f i r s t c a l l a b l e a f t e r 12 years through September 1955# and those due or c a l l a b l e i n 10-12 years t h e r e a f t e r ; the average term to f i r s t c a l l of the bonds included declined from lit years in early 1953 to 11 1 / 2 years in e a r l y 1956. The new s e r i e s i s comprised of the 3 per cent bond of 1995 and the 3 l / k per cent bond of 1978-83. • 3 / Thursday f i g u r e s . Only general o b l i g a t i o n bends are included; average term i s 20 years. Note.—Highs and lows are f o r individual s e r i e s and may be on d i f f e r e n t dates for different series. EXHIBIT B L O W E R - G R A D E B O N D YIELDS Weekly Per cent p e r V Date ! Corporate State and local govt. Baa 2/ State and local govt. rev. 3/ (Per cent) 1953 - High Low 195k - High Low 1955 - High Low 1956 - High Low 3.89 3.50 3.7U 3.Wi 3.63 3.1*5 U.05 3.58 August 10 August 17 August 2k August 31 September 7 September lit 3.90 3.91 3.95 3.97 It. 01 4.05 (9/18) (1/2) (1/8) (12/31) (12/30) (l/lli) (9/Hi) (3/9) 3.79 2.96 3.32 2.93 3.26 3.02 3.60 3.20 3.1*6 3.5U 3.57 3.60 3.60 3.60 (6/25) (1/8) (1/7) (8/5) (12/29) (1/6) (9/13) (3/8) 3.27 2.71 3.00 2.72 2.99 2.76 3.51 2.89 3.22 3.31 3.39 3.51 3.51 3.50 (6/26) (1/2) (1/1) (8/13) (12/30) (1/7) (9/7) (2/21*) . 1/ Weekly average of daily figures. Average term of bonds included i s 25-26 years. 2/ Thursday figures. Only general obligation bonds are included; average term i s 20 years. 3/ Friday figures. Average rating of bonds included i s between Baa and Aj average term i s 20 years. Note.—Highs and lows are for individual series and may ' be on different dates for different series. STOCK MARKET Date Stock p r i c e index 1/ Common Trading volume 2 / (millions yields j / of s h a r e s ) ( p e r c e n t ) Stock market cust<aner c r e d i t Customers 1 debit b a l - loans t o ances h / "others" £ / ( M i l l i o n s of d o l l a r s ) 1951* - High Low 1955 - High Low 1956 - High Low 167.1 Utlt.O 221.lt 156.5 270.7 217.lt 295.5 257.lt July August August 31 September 7 September lit 290.1 290.0 283.2 285.1 281.3 1953 - High (1/2) (9/18) (12/31) (1/6) (12/30) (1/llt) (8/3) (1/20) 2.5 0.9 3.7 l.h lt.6 1.5 3.1 1.6 5.75 5.15 5.33 It. 20 It. 22 3.78 14.21 3.86 2,Wt5 2,055 3,1*36 2,lt05 It,030 3,537 lt,0lt7 3,979 1,665 l,3Ht 2.388 1,653 2,805 2,517 2,810 2,7ltO 780 661t l,0lt8 7lt6 l,2ltl 1,018 1,267 1,192 2.2 1.9 1.6 1.8 2.0 3.87 It.02 It,0263,979 2,812 2,785 n.a. l,2llt 1,205 r/l,19U 1,192 n.a. n.a. tJ Revised. n.a.—Not available. 1 / SEC index of 265 common s t o c k s , weekly c l o s i n g p r i c e s , 1939=100; converted t o 19u7-1j9*100 by Federal Reserve. The conversion f a c t o r i s 1 2 3 . 9 1 . f Averages o f d a i l y trading volume on the New York Stock Exchange. f Moody's 200 common s t o c k s ; end of month f i g u r e s . %/ 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 carry margin accounts; excludes balances secured by U. S. Government o b l i g a t i o n s . SJ Wednesday f i g u r e s f o r weekly r e p o r t i n g member banks. Excludes l o a n s f o r purchasing or c a r r y i n g U. S. Government s e c u r i t i e s a t banks in New York and Chicago. Weekly r e p o r t i n g banks account f o r about 72 per cent of loans t o o t h e 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 for different series. - H.lU Exhibit D Corporate and State and Local Government Security Offerings and Placements (In millions of d o l l a r s ) 1956 January February March April May June July August September 535 1*07 1,223 816 1,144 830 478 886 687 e/1,120 e/700 e/850 597 644 670 1,162 ^ 632 900 2,073 2,790 e/2,670 . New c a p i t a l Corporate 1955 1 579 70h 790 October ^November •" December 1 s t quarter 2nd quarter 3rd quarter 4th. quarter Year 1 ' 2,165 2,052 1,911 2,695 8,821 . 1954 1956 547 426 635 4o4 696 390 197 656 8U2 909 335 747 • • 377 190 735 e/380 e/215 e/350 1,003 290 604 1,608 1,995 1,991 1,896. 7,490 S t a t e and l o c a l 1 1955 1 1,490 1/03 945 • 195 U 535 312 538 396 411 565 427 350 64l 734 748 853 470 . • 24 9 4o6 279 261 649 919 658 408 594 423. 877 1,385 1,418 1,124 1,984 5,911 1,372 2,334 1,188 1,894 6,789 Excluding finance companies 2 / 1 s t quarter 2nd quarter 3rd quarter " 4th quarter Year 1,617 2,520 e/2,470 1,727 1,870 1,434 2,554 7,56? 1,527 1,927 1,911 1,792 7,158 e / Estimated. ' ' . 1 / Includes §637.2 million AT&T convertible debenture i s s u e . 2/ 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 sales and personal finance companies. lNote.--Details may not add to t o t a l s due to rounding. H.ll* Exhibit E Large 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. Treasury) Proceeds of Large I s s u e s Offered (Millions of d o l l a r s ) Month Corporate 1955 - August September October November December 1956 - January February March April May June July August S t a t e and l o c a l government . W5 328 805 . 221 263 95 212 278 395 623 185 592 217 Other 2 / 65 23U 716 hoi 227 192 1M 163 157 233 I63 I6h 35 25 50 50 20 37 Large I n d i v i d u a l Issues Offered Sept. 1 through ll* ' Issuer Type 3 / Amount Coupon (millions r a t e or Offering Maturity n e t i n t e r of y i e l d . Rating dollars) est cost CORPORATE Gulf S t a t e s Utilities Co. General Telephone of Cal. Southern Cal. Edison Northern S t a t e s Power Co. Procter & Gamble Co. D e t r o i t Edison Co. 1st mtg.bds. 1st mtg. bds. Common s t k . 1st mtg.bds. Deb. Conv. deb. 15.0 20.0 2U.3 15.0 70.0 59.8 1986 • 1986 h 1/h h 1/2 I*.20 M l Aa A 1986 1981 1971 h 1/h 3 7/8 3 3/a h.n 3.88 3.75 Aa . Aa A STATE & LOCAL GOVERNMENT Port of New York Autho r i t y , N. Y. Allegheny Co. I n s t . D i s t . , Pa. Oakland Unified School D i s t . , Cal. € Rev. 25.0 1986 3.52 3.1*5 A G.O. 6.3 1957-86 3.17 2.20-3.20 A G.O. 10.0 1957-81 2.85 2.10-2.90 Aa . Large I n d i v i d u a l Issues Offered Sept. 1 through lit (Cont'd) Type 3 / Amount Coupon (pillions Maturity r a t e or O f f e r i n g Rating yield of net i n t e r dollars) e s t cost STATE & LOCAL GOVERNMENT (Cont'd) New York, Mew York S t a t e of Michigan G.O. L.L. 30.0 25.0 1957-71 1957-79 3.28 3.0U 2.25-3.30 2.15-3.00 A Aa OTHER None 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 .$5 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 . 3/ In the case of S t a t e and l o c a l government s e c u r i t i e s , G.O. denotes general o b l i g a t i o n ; Rev., revenue bonds5 G.R., general o b l i g a t i o n s a d d i t i o n a l l y secured by f a c i l i t i e s revenues3 L . L . , l i m i t e d l i a b i l i t y o b l i g a t i o n s secured by pledge of designated revenues. H.Ik Exhibit F Forthcoming Large Public Security Offerings f o r New Capital (Other than U. S. Treasury) 1 / Expected Proceeds from Forthcoming Large Issues During month following date shown State and Corporate l o c a l govt. Other 2 / Date of computation 222 805 202 215 70 176 123 380 568 198 U37 21+7 369 1955 - Aug. 31 Sept. 30 Oct. 31 Nov. 30 Dec. 30 1956 - Jan. 31 Feb. 29 Mar. 30 Apr. 30 May 31 June 30 July 31 Aug. 31 18U 8U3 330 205 121 327 220 132 173 332 81 — 131 50 mmmm —— 37 Subsequent t o date shown State and Corporate l o c a l govt. Other 2 / 920 909 1+12 230 85 376 233 1,013 818 khQ 567 1,096 1,202 . 1,971 2,205 1,650 % 618 917 785 811 832 9ia 690 726 958 50 —— — — 1 — — 37 Forthcoming Large O f f e r i n g s , as of September 111 f ; Issuer — Type Amount (millions Approximate date of o f f e r i n g of d o l l a r s ) CORPORATE Tennessee Gas Transmission Co. ^Tennessee Gas Transmission Co. CIT F i n a n c i a l Corp. Southern P a c i f i c R.R. Co. North American Aviation, Inc. 1st mtg. bds. , Pfd. s t k . Deb. 1 s t mtg. bds. Cap. s t k . 50.0 20.0 75.0 35.0 43,5 Virginia E l e c t r i c & Power Co. New England Tel. & Tel. Co. 1 s t mtg. bds. Cap. s t k . 20.0 18.9 ^ P a c i f i c Tel. & Tel. Co. Common s t k . 16.2 United A i r c r a f t Corp r Conv. pfd. s t k . Columbia Gas System, Inc. ^Southern Bell Tel. & Tel. Co. American Tel. & Tel. Co. J . P. Stevens & Co. . P a c i f i c Finance Coip. Michigan Wisconsin Pipe Line Co. Commercial Credit Co. 38.8 Deb. Deb. Common s t k . 25.0 60.0 580.0 S.F. deb. Deb. 1 s t mtg. bds. Notes 28.7 25.0 25.0 50.0 September 19 September 19 September 19 September 20 September 2k ( r i g h t s expire) September 25 September 28 ( r i g h t s expire) September 28 ( r i g h t s expire) October 2 ( r i g h t s expire) October October November 5 ( r i g h t s expire) 1956 1956 1956 1956 H.lU F-2 Forthcoming Large O f f e r i n g s , as of September lU (Cont'd) Issuer Type Amount (millions Approximate d a t e of o f f e r i n g of d o l l a r s ) • STATE AND LOCAL GOVERNMENT Los Angeles School D i s t s . , Cal. Nassau Co., New York Kansas C i t y , Missouri F l o r i d a Development Commission ^Kalamazoo School D i s t . , Mich. W e s t c h e s t e r Co.", N. Y. *Chieago Bd. of Education, H I . Jacksonville Expressway Authority Memphis, Tennessee Washington S t a t e T o l l Bridge Auth. F l o r i d a S t a t e Turnpike Authority Oklahoma Turnpike Authority Pennsylvania Turnpike Commission Washington S t a t e T o l l Bridge Auth. Inter-American Center A u t h . , F l a . New j e r s e y Highway Authority New York S t a t e Thruway Authority G.O. G.O. Water r e v . Bridge r e v . G.O. G.O. . G.O. Rev. Elec. rev. Rev. Rev. Rev. Rev. Rev. Rev. Rev. G.O. 29.0 19.6 9.5 : 5.5 10.0 7.3 10.0 42.0 135.0 S.k 185.0 _ 65.0 62.0 227.0 31.0 25.0 50.0 September 18 September 18 September 19 September 20 September 25 September 26 November lU Fall Fall Fall Fall 1956 1956 1956 1956 1956 1956 OTHER None *—Included in t a b l e f o r f i r s t time. 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 $5 m i l l i o n and over. 2 / Includes f o r e i g n government and I n t e r n a t i o n a l Bank f o r Reconstruction and Development i s s u e s . H. II4. Exhibit G Yields on New and Outstanding E l e c t r i c Power Bonds, Rated Aa and A 1 / Date 1952 1953 19$h 1955 average average average average 1956 - January February March 8 16 23 30 April U k 11 25 May 9 . 16 2h June 8 20 July 3 18 25 August 1 30 September 11 13 A-rated o f f e r i n g y i e l d s Aa-rated o f f e r i n g y i e l d s Amount above Amount above Actual Actual seasoned y i e l d s (per cent) seasoned y i e l d s (per cent) (basis p o i n t s ) (basis points) 3.16 3.1+6 '3.03 3.23 13 16 3 9 None *3.12 3.19 3 5 3.37 18 3.77 ho 3.53 3.52 19 18 3.62 3.70 26 33 h.07 1.20 lt.17 52 62 58' 3.35 3.78 3.12 3.33 12 26 -3 12 None 3.23 -5 3.35 7 3.55 3.57 3.60 3.67 25 23 26 29 3.80 3.73 - 32 2k 3.75 3.82 ii.00 . 27 28 h3 *—Single observation, not an average. 1 / Covers only 30-year f i r s t mortgage bonds, as 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 t h e amount above seasoned y i e l d s a r e averages of o f f e r i n g s d u r i n g the i n d i c a t e d period and of the d i f f e r e n c e s between these new o f f e r i n g y i e l d s and y i e l d s on seasoned issues of s i m i l a r q u a l i t y f o r the same day. The number of new i s s u e s included in the monthly averages v a r i e s from 2 t o ii except f o r October 195k when 6 A - r ated i s s u e s were included. Average maturity f o r the seasoned i s s u e s v a r i e s from 26 t o 28 y e a r s .
@FedFRASER