The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
FEDERAL RESERVE statistical release UBRARYPOR E. 2 SURVEY OF TERMS OF BANK LENDING APR 6 1987 IMMEDIATE RELEASE March 30, 1987 Notes on Survey Content A cover note to the previous E,2 release, dated December 23, 1986, presented data indicating that commercial and industrial loans priced with reference to the prime rate most commonly are made in smaller denominations and are, on average, more expensive than loans priced with respect to other reference rates. This cover note provides additional information on the pricing of prime-based loans—by far the most frequently made type of C&I loan. As shown in the table on this page, almost one-fourth of all primebased loans made in February were priced at the prevailing prime rate itself, while close to two-thirds were made at rates between prime and prime plus 2 percentage points. Most loans priced at more than 2 percentage points over prime were made in denominations of under $500,000, although 6-1/2 percent of the loans made in amounts of $1 to $5 million had this expensive pricing. The wide spectrum of rates at which prime-based loans of all sizes are made appears to reflect primarily the varying degrees of risk that banks assign to different loans. Lesser risk often attributed to larger compared to smaller b o r r o w e r s l i k e l y e x p l a i n s i n p a r t expensive than smaller loans. t h e t e n d e n c y for l a r g e r l o a n s to b e l e s s Lower rates on larger loans presumably also Selected Characteristics of Prime-Based Commercial and Industrial Loans, February 2-6, 1987 (all insured commercial banks) ' (• I * Loan Size ($1,000) 0-499 500-999 1,000-4,999 5,000 + All loans Note: Gross Loans Extended ($ billion) Average Loan Rate (percent) Below Prime Percent of Loans Extended at Rates Above Above Prime Prime+1% At to to Above Primef 1% Prime Primef 2% Primef2% 5.3 1.4 3.9 4.1 8.80 8.20 8.23 8.14 .6 1.8 2.4 9.3 17.0 33.3 31.4 21.8 37.6 41.4 42.1 36.7 28.1 20.2 17.6 31.8 16.7 3.2 6.4 .4 14.7 8.41 3.7 23.7 38.9 25.6 8.1 The prevailing prime rate during the survey week was 7,5 percent. — 2 — reflect the declining importance of the fixed costs of lending as loan size increases. In addition, customers {taking down large loans typically have more borrowing alternatives and thus may have greater leverage in rate negotiations. The small share of prime-based loans made at rates below prime in February appears to reflect a mixture of restructured loans (loan repriced to recognize financial difficulties borrowers have encountered) and loans priced at discounts from prime on the basis of borrowers' negotiating power or other competitive factors. Restructuring appears to have been an important element in the below-prime pricing of loans made in denominations of under $1 million, as these relatively small loans had rates that actually averaged below those on large below-prime loans. Below-prime loans made in amounts of $1 million and above appear similar to (but much less common than) the large short maturity loans that banks price with respect to the federal funds rate and other money market rates. Selected Characteristics of Prime-Based Commercial and Industrial Loans by Relation of Loan Rate to Prime Rate, February 2-6, 1987 (all insured commercial banks) Loan Size ($1,000) Loans Extended at Rates Below Prime Average Average Average Maturity Size Rate (months)1 ($1,000) (percent) Loans Extended at Rates of Prime and Above Average Average Average Rate Maturity Size ($1,000) (percent) (months)* 0-499 500-999 1,000-4,999 5,000 + 6.34 6.49 6.84 6.65 125 694 2,199 6,909 16.1 7.4 .8 1.9 8.81 8.23 8.27 8.30 45 634 1,924 13,307 16.0 23.1 21.6 39.9 All loans 6.65 1,361 2.7 8.47 117 25.7 1. Excludes demand loans. > FEDERAL RESERVE statistical release [[[[[ * • f*AL S U R V E Y OF T E R M S OF TABLE BANK LENDING MADE DURING FEBRUARY 2-6, 1987 1 COMMERCIAL AND INDUSTRIAL LOANS (OTHER THAN CONSTRUCTION A N D L A N D D E V E L O P M E N T ) M A D E BY ALL LOAN AMOUNT OF LOANS LOAN CHARACTERISTICS ($1,000) I 1. ALL RATE COMMERCIAL (PERCENT) A V E R A G E I WEIGHTED WEIGHTEDI I SIZE I AVERAGE AVERAGE (STANDARD) ($1,000)|MATURITY EFFECTIVE I ERROR | 3/1 4/1 I INTERNQUARTILE RANGE 5/ BANKS 1/ P E R C E N T A G E OF A M O U N T OF L O A N S M A D E U N D E R : j I I M O S T | I COMMON I I BASE I !__!!! COMMITMENT!PARTICIPATION!PRATEN°! DAYS C 8 I LOANS OVERNIGHT 7/ 15,399,940 7,055 ONE MONTH A N D UNDER (EXCL O V E R N I G H T ) -FIXED RATE -FLOATING RATE 7,737,558 5,981,071 1,756,488 487 725 230 OVER ONE MONTH A N D UNDER A YEAR -FIXED RATE -FLOATING RATE 9,459,714 3,900,457 5,559,258 89 114 DEMAND 8/ -FIXED RATE -FLOATING RATE 5,431,743 409,577 5,022,166 151 205 148 TOTAL UNDER ONE Y E A R -FIXED RATE BY S I Z E ( $ 1 , 0 0 0 ) 1-24 25-49 50-99 100-499 500-999 1000+ -FLOATING RATE BY S I Z E ( $ 1 , 0 0 0 ) 1-24 25-49 50-99 100-499 500-999 1000+ 6.86 19 7.38 7.14 18 22 102 151 113 178 FOR FED FUNDS 0.14 6.81-7.60 6.76-7.31 7.04-8.86 72.8 71.0 78.8 8.5 9.9 4.0 DOMESTIC DOMESTIC PRIME 0.19 7.11-8.78 6.91-7.87 7.71-8.84 73.1 65.8 78.2 10.1 6.0 7.7 PRIME DOMESTIC PRIME 7.71-8.84 6.54-7.74 7.71-8.84 80.8 4.0 6.3 3.8 PRIME OTHER PRIME 0.15 8.18 0.12 0.28 0.23 0.11 83.7 80.6 260 49 7.46 0.14 6.70-7.79 79.2 6.7 FED FUNDS 25,481,985 328,649 171,646 150,041 426,753 290,051 24,114,846 453 23 7.07 0.15 0.24 79.0 24.2 18.0 25.6 43.8 66.3 81.3 7.7 0.1 8,365 6.58-7.25 9.93-12.39 8.88-12.38 8.84-11.02 7.71-9.85 7.05-8.06 6.57-7.17 FED FUNDS OTHER PRIME PRIME PRIME PRIME FED FUNDS 12,546,972 439,620 489,566 788,340 2,431,898 1,081,056 7,316,492 139 9 34 67 190 631 3,289 79.6 67.3 69.0 74.9 78.0 8 112 32 63 11.20 117 133 90 182 661 66 19 162 151 149 127 0.12 0.05 0.13 0.12 9.73 9.45 9.05 8.71 8.36 7.85 0.07 0.07 0.04 0.15 7.71-8.84 8.84-10.43 8 66-9 92 8.30-9.65 7.78-9.38 7.76-8.84 7.04-8.33 0 .18 0.11 54 8.50 1,735,926 159,809 193,759 46,475 1,335,882 188 20 226 634 81,286 51 56 41 61 51 8.41 11.04 10.04 9.02 7.84 5,418,876 269,359 529,155 356,616 4,263,747 393 27 211 663 5,,862 55 46 53 56 55 8.53 9.81 8.99 8.55 8.39 1 LOAN X 9,614 5,966,654 4,205 17 3,901,031 1,405,330 25,635,502 22,475,849 3,159,654 613 948 2,383 3,662 684 126 * 25 18 105 1,681,276 818,875 862,401 906 792 1,050 MONTHS 54 51 56 2.9 9.0 7.9 4.8 3.4 1.5 2.0 2.8 80.8 81.9 5.7 5.9 PRIME PRIME PRIME PRIME PRIME PRIME PRIME 7 . 7 1 - 9 .04 78.7 7.3 PRIME .55 .37 ,30 .46 .68 6 . 8 7 - 9 .04 9 . 9 2 - 1 1 .85 9 . 3 8 - 1 0 ..47 7 . 7 1 - 1 0 ,.47 6 . 7 6 - 8 ..44 73.4 6.6 12.8 52.9 91.0 2.0 0.8 0.8 3.3 2.3 FED FUNDS PRIME OTHER OTHER FED FUNDS 0 .15 0,.16 0,.14 0,.11 0,.12 7 . 7 6 - 9 .04 8 . 8 4 - 1 1 ..02 8 . 1 6 - 9 ..38 7 . 7 6 - 9 ,.11 7 . 7 1 - 9 ..04 80.3 46.3 64.0 78.4 84.7 9.0 2.4 6.2 8.6 9.8 PRIME PRIME PRIME PRIME PRIME 7..1 0 0 0 0 0 RATE (PERCENT) 1 EFFECTIVE 14,362,487 2.1 0.2 | 310 DAYS 0.23 0.24 8.26 136 153 144 MONTHS 0.20 10.56 9.76 8.76 7.69 6.94 7,154,803 11/ FOOTNOTES 6.2 38,028,957 j LAST PAGE 85.6 8.09 7.75 8.33 | TOTAL O N E YEAR A N D OVER -FIXED RATE -FLOATING RATE 6.49-7.04 0.06 0.21 7.10 j 1 LOANS MADE BELOW PRIME OVERNIGHT 7/ ONE MONTH A N D UNDER (EXCL O V E R N I G H T ) OVER O N E MONTH A N D UNDER A YEAR DEMAND 8/ TOTAL UNDER ONE YEAR -FIXED RATE -FLOATING RATE 0.26 8.21 8.26 j TOTAL ONE YEAR A N D OVER -FIXED RATE BY S I Z E ( $ 1 , 0 0 0 ) 1-99 100-499 500-999 1000+ -FLOATING RATE BY S I Z E ( $ 1 , 0 0 0 ) 1-99 100-499 500-999 1000+ SEE . FOR I M M E D I A T E R E L E A S E M A R C H 30, 1 9 8 7 E.2 2. R £ ^ 3 / I NOMINAL j " | I j RATE 10/ 1 | 6.53 7 .51 87.2 6 .96 6.74 7 .51 73.7 10..6 6 6 6 6 6 .99 .83 .84 .82 .96 6.81 6.63 6.63 6.61 6.75 7 7 7 7 7 .60 .55 .52 .51 .61 79.2 72.9 82.1 81.7 84.7 12..3 5. 4 8..6 8.9 6 .7 7 .09 7 .00 7..18 6.91 6.86 6.96 7.70 7 .67 7 .73 90.4 91.1 89.7 5 .1 3 .8 6 .3 6 .75 j S U R V E Y OF T E R M S OF TABLE 2 COMMERCIAL BANK LENDING MADE DURING AND INDUSTRIAL LOANS LOAN C H A R A C T E R I S T I C S 1. ALL F E B R U A R Y 2-6,' 1987 ( O T H E R T H A N C O N S T R U C T I O N A N D L A N D D E V E L O P M E N T ) M A D E BY L A R G E B A N K S AMOUNT OF L O A N S ($1,000) 1 1 1/ I P E R C E N T A G E OF A M O U N T I MOST I I OF L O A N S M A D E U N D E R : I COMMON 1 I 1 BASE 1 I I 1 PRICING! I COMMITMENT I PARTICIPATION I RATE I 1 LOAN RATE (PERCENT) 1 INTERAVERAGE WEIGHTED! WEIGHTED! 1 QUARTILE SIZE AVERAGE! AVERAGE I STANDARD I ($1,000) MATURITY!EFFECTIVE! ERROR RANGE I 5/ 2/1 3/1 4/1 1 1 1 DAYS I 1 ! 6 ' i C & I LOANS 11, 140, 547 11,,322 X 6.94 0 .05 6 . 5 4 - 7 .14 87.9 7.3 FED FUNDS ONE MONTH A N D UNDER (EXCL O V E R N I G H T ) -FIXED RATE -FLOATING RATE 5, 361, 941 4, 384, 3 7 2 977, 569 2,,606 4/,168 972 20 19 23 7.25 7.13 7 .74 0 .04 0 .04 0 .11 6 . 8 2 - 7 .56 6 . 8 1 - 7 .42 7 . 0 1 - 8 .30 76.8 73.4 92.2 8.2 8.9 4.8 DOMESTIC DOMESTIC PRIME OVER ONE MONTH A N D UNDER A YEAR -FIXED RATE -FLOATING RATE 5, 390, 766 2, 692, 047 2, 698, 7 2 0 557 1,,869 328 138 106 170 7.57 7.20 7.94 0 .13 0 .11 0 .16 6 . 9 1 - 8 .14 6 . 8 4 - 7 .34 7 . 1 9 - 8 .57 79.6 75.4 83.8 9.4 13.0 5.8 PRIME DOMESTIC PRIME DEMAND 8/ -FIXED RATE -FLOATING RATE 2, 542, 1 3 4 148, 906 2, 393, 2 2 8 296 709 286 * * X 7.95 6.67 8.03 0 .20 0 .34 0..20 6 . 9 6 - 8 .84 6 . 6 3 - 8 .30 7 . 2 3 - 8 .84 76.6 82.6 76.3 2.2 0.9 2.3 OVERNIGHT 7/ TOTAL UNDER ONE YEAR -FIXED RATE BY S I Z E ( $ 1 , 0 0 0 ) 1-24 25-49 50-99 100-499 500-999 1000+ -FLOATING RATE BY S I Z E ( $ 1 , 0 0 0 ) 1-24 25-49 50-99 100-499 500-999 1000+ TOTAL ONE YEAR AND OVER -FIXED RATE BY S I Z E ( $ 1 , 0 0 0 ) 1-99 100-499 500-999 1000+ -FLOATING RATE BY S I Z E ( $ 1 , 0 0 0 ) 1-99 100-499 500-999 1000+ 24, 435, 3 8 8 1,,147 39 7.25 0 ,04 6.71-7.67 82,5 7.4 FED FUNDS 18, 2 5 1 , 6 6 8 7, 7 5 3 7, 3 1 2 13, 6 5 1 101, 1 9 4 142,968 17, 978, 7 9 0 4, 9 7 3 10 33 63 237 696 91 8 7 2 21 92 82 75 48 56 21 7.03 10.00 9.24 9.11 8.08 7 .74 7.01 0. 04 0..23 0. 15 0. 38 0. 16 0. 14 0. 04 6 . 6 3 - 7 .25 8 . 8 4 - 1 0 .70 8 . 7 8 - 9 .89 8 . 3 0 - 9 .86 7 . 1 1 - 8 .81 7 . 1 0 - 8 ,.24 6 . 6 3 - 7 .25 82.4 23.7 33.3 35.8 74.3 81.3 82.6 8.5 0.0 1.6 0.0 2.5 3.7 8.6 FED FUNDS PRIME PRIME PRIME PRIME PRIME FED F U N D S 6, 183, 7 2 0 71, 4 0 0 92, 170 189, 1 3 3 8 0 3 , 507 432, 844 4, 5 9 4 , 6 6 6 351 11 34 67 203 645 4, 3 9 4 127 177 180 191 154 132 119 7.91 9.29 9.05 8.91 8.58 8.35 7.67 0. 13 0. 17 0. 13 0. 10 0. 08 0. 06 0. 17 7 . 0 4 - 8 .57 8 . 3 0 - 9 .96 8 . 3 0 - 9 .65 8 . 3 0 - 9 .38 7 . 7 6 - 9 .11 7.76-8, 84 6 . 9 1 - 8 ,.30 82.5 80.6 80.7 81.0 84.6 83.7 82.2 4.2 0.1 0.6 1.0 2.0 4.5 4.8 PRIME PRIME PRIME PRIME PRIME PRIME PRIME 5, 209, 7 3 1 1,,600 53 8.26 0 .17 7 . 5 2 - 9 .04 88.6 7.5 PRIME 1, 132, 070 7, 5 8 2 18, 4 4 5 25, 191 1, 080, 8 5 2 2, ,275 26 219 622 12,,747 52 44 50 62 52 7.86 12.37 9.66 8.42 7.78 1..07 0 .52 0 .51 0,.64 1 .35 6.76-8 9.92-12 7.76-10 7.50-9 6.76-8 .44 .96 .47 .92 .44 92.4 37.8 70.9 62.9 93.9 0.3 0.3 8.1 6.2 0.0 FED F U N D S OTHER PRIME PRIME FED FUNDS 4, 077, 6 6 1 38, 9 2 3 185, 7 0 5 215, 8 7 0 3, 6 3 7 , 1 6 2 1,,478 34 230 696 7j ,179 53 38 47 50 54 8.37 9.17 8.69 8.47 8.34 0..20 0 .14 0 .14 0 .10 0 .23 7.71-9 8.30-9 7.76-9 7.76-9 7.71-9 .04 .65 .31 .04 .04 87.5 70.1 85.3 91.4 87.6 9.5 4.0 7.9 7.7 9.7 PRIME PRIME PRIME PRIME PRIME | i — MONTHS m r j I LOAk RATE (fttcEkt) E L E C T I V E I NOMINAL 2. L O A N S M A D E B E L O W P R I M E 11/ OVERNIGHT 7/ ONE MONTH AND UNDER CEXCL O V E R N I G H T ) OVER ONE MONTH A N D UNDER A YEAR DEMAND 8/ TOTAL UNDER ONE YEAR -FIXED RATE -FLOATING RATE TOTAL ONE YEAR A N D OVER -FIXED RATE -FLOATING RATE S E E L A S T P A G E FOR FOOTNOTES PRIME OTHER PRIME ! !LI !1_ PRIME RATE 10/ 10,140,915 12,737 X 6.80 6.58 7.50 9 0 .5 7.9 4,324,907 5,794 18 7.00 6.78 7.50 7 5 .0 9.9 > 3,143,949 815,327 18,425,097 16,276,719 2,148,378 5,708 2,226 7,491 8,746 3,589 123 X 27 19 114 6.97 6.70 6.87 6.87 6.89 6.78 6.50 6.66 6.65 6.69 7.51 7.53 7.50 7.50 7.52 79,.5 57, 3 83,.5 83 6 82 5 11.1 0.0 8.6 9.2 4.2 1 1,317,237 609,772 707,465 5,243 11,239 3,591 6.89 6.79 6.97 6.73 6.69 6.76 7.52 7.50 7.53 100.0 100.0 100.0 7.0 I MONTHS I L J 3 T 59 3.8 0.0 SURVEY OF TERMS OF BANK LENDING M A D E DURING FEBRUARY 2-6, 1987 TABLE 3 COMMERCIAL AND INDUSTRIAL LOANS (OTHER THAN CONSTRUCTION AND LAND DEVELOPMENT) M A D E BY OTHER BANKS I LOAN CHARACTERISTICS AMOUNT OF LOANS ($1,000) 7/ LOAN RATE (PERCENT) A V ERAGE I WEIGHTED! WEIGHTED! T SIZE | AVERAGE! AVERAGE !STANDARD! ($1, 090)1 MATURITY I EFFECTIVE! ERROR j I 2/I 3/1 4/| L L 1. ALL C & I LOANS OVERNIGHT I DAYS ' 1/ PERCENTAGE OF AMOUNT I MOST I OF LOANS M A D E UNDER: I COMMON I , I BASE I I I PRICING! I COMMITMENT I PARTICIPATION 1 RATE I I 1 6 / f J I INTERQUARTILE RANGE 5/ ' 4 ,259 ,393 3 ,553 X 6 .66 0 .54 6.38-6 .88 79 .6 3 .2 ONE MONTH AND UNDER (EXCL O V E R N I G H T ) -FIXED RATE -FLOATING RATE 2 ,375 ,618 1 ,596 ,699 778 ,919 172 222 117 18 17 21 7 .69 7 .16 8 .78 0 .23 0 .12 0 .31 6.71-8 .07 6.63-7 .13 7.18-10 .48 63 .8 64 .6 62 .0 9 .3 12 .4 3 .0 OVER ONE MONTH AND UNDER A YEAR -FIXED RATE -FLOATING RATE 4 ,068 ,948 1 ,208 ,410 2 ,860 ,538 49 28 71 168 129 185 8 .79 8 .99 8 .71 0 .08 0 .19 0 .11 7.75-9 .38 7.19-10 .79 7.79-9 .38 64 .5 44 .4 73 .0 5 .5 3 .8 6 .2 PRIME OTHER PRIME DEMAND 8/ -FIXED RATE -FLOATING R A T E 2 r 889,609 260 ,671 2 ,628 ,938 106 145 103 X X X 8 .38 7 .35 8 .48 0 .11 0 .34 0 .07 7.76-8 .87 6.54-7 .34 7.76-8 .87 84 .5 84 .4 84 .5 5 .5 9 .4 5 .2 PRIME OTHER PRIME 13,, 593,568 109 68 7 .84 0 .19 6.66-8 .81 73 .3 5 .5 7,,230 ,317 320 ,895 164 ,334 136,,390 325,,559 147,,083 6,,136,,056 138 8 32 63 170 630 5,,780 27 112 118 140 102 77 13 7 .18 11 .23 10 .62 9 .82 8 .97 7 .65 6 .71 0 .27 0 .26 0,.13 0. 22 0..38 0. 21 0.,07 6, 363,,252 368,,219 397,,396 599,,207 1, 628,, 391 648, 212 2, 721, 826 88 9 34 67 183 621 2, 308 146 149 137 153 150 159 140 8 60 9 .81 9 54 9. 10 8. 77 8. 37 8. 14 0. 12 0. 07 0. 14 0. 11 0. 10 0. 06 0. 20 TOTAL UNDER ONE YEAR -FIXED RATE BY SIZE ($1,000) 1-24 25-49 50-99 100-499 500-999 1000+ -FLOATING RATE BY SIZE ($1,000) 1-24 25-49 50-99 100-499 500-999 1000+ | MONTHS TOTAL ONE YEAR AND OVER -FIXED RATE BY SIZE ($1,000) 1-99 100-499 500-999 1000+ -FLOATING RATE BY SIZE ($1,000) 1-99 100-499 500-999 1000+ SEE LAST PAGE FOR FOOTNOTES 70 24 17 24 34 51 77 PRIME 3 2 .3 .6 .3 .8 .5 5 .6 0 .1 2 .1 0 .2 3 .1 14 .3 6 .0 FED FUNDS OTHER PRIME PRIME PRIME PRIME FED FUNDS 7.76-9 .38 8.84-10 .47 8.77-9 .95 8.30-9 .80 7.79-9. 38 7.76-8. 84 7.34-8. 78 76. 8 64..7 66 .3 73. 0 74. 8 79. 0 81. 5 5 ,3 4 .0 1 ,7 2 4 3 1 6 .5 7. 7 PRIME PRIME PRIME PRIME PRIME PRIME PRIME j 9. 14 0. 20 8.20-9. 92 52. 1 6. 8 PRIME 69 19 226 649 3, 337 48 56 40 60 47 9. 44 10. 97 10. 07 9. 73 8. 07 0. 45 0. 14 0. 35 0. 66 0. 61 7.65-10. 47 9.92-11. 57 9.38-10. 47 9.31-10. 47 6.65-9. 04 37. 9 5. 0 6 .7 41. 1 78. 6 5. 4 0. 8 0. 0 0. 0 12. 2 OTHER PRIME OTHER OTHER OTHER 121 26 202 619 2, 838 58 47 56 65 62 9. 01 9. 92 9. 16 8. 67 8. 66 0. 12 0. 19 0. 22 0. 19 0. 05 8.24-9. 38 8.84-11. 02 8.30-9. 65 8.11-9. 31 8.17-9. 38 58. 5 42. 3 52. 4 58. 4 67. 7 7. 5 2. 1 5. 2 10. 1 10. 1 PRIME PRIME PRIME PRIME PRIME 98 603, 856 152, 228 175, 314 21, 284 255, 030 1, 341, 216 230, 436 343, 450 140, 746 626, 585 DAYS I LOAN RATE (PERCENT) 1 1 EFFECTIVE I NOMINAL 9/ s/ 1 ! PRIME RATE 10/ I I I 1 4,,221, 573 6,,051 X 6 .63 6.42 7.53 79 .4 5.0 1 ,,641, 747 2,,441 16 6 .84 6.62 7.53 70 .4 12.4 757, 081 590, 004 7,,210, 405 ,199, 130 6, I, ,011, 275 130 529 869 1 ,,450 251 142 X 21 14 85 7 7 6 6 7 .10 .01 .76 .70 .11 6.91 6.80 6.55 6.49 6.90 8.01 7.57 7.58 7.54 7.83 78 .2 94 .3 78..5 76 .7 89 .4 17.2 12.9 8.6 8.1 11.9 364, 039 209, 103 154, 936 227 213 248 7 .85 7 .62 8 .16 7.58 7.37 7.86 8.38 8.18 8.64 55 .5 65 .1 42 .5 9.8 14.9 2.8 j TOTAL ONE YEAR A N D OVER - F I X E D RATE -FLOATING RATE .18 .40 .38 .02 .06 .76 .95 PRIME DOMESTIC PRIME 55 1, 945, 072 I 1 2. LOANS M A D E BELOW PRIME 11/ OVERNIGHT 7/ ONE MONTH AND UNDER (EXCL O V E R N I G H T ) OVER ONE MONTH AND UNDER A YEAR DEMAND 8/ TOTAL UNDER ONE YEAR - F I X E D RATE -FLOATING RATE 6.45-7 10.00-12 8.97-12 8.87-11 7.71-10 6.93-7 6.45-6 FED FUNDS MONTHS 48 51 43 I S U R V E Y OF T E R M S O F B A N K L E N D I N G M A D E D U R I N G F E B R U A R Y 2 - 6 , 1987 TABLE 4 C O N S T R U C T I O N A N D L A N D D E V E L O P M E N T L O A N S ( S E C U R E D A N D U N S E C U R E D BY REAL ESTATE) LOAN R A T E ( P E R C E N T ) 1 AMOUNT I OF L O A N S I ($1,000) AN C H A R A C T E R I S T I C S ! ALL BANKS 1/ FIXED RATE BY S I Z E ( $ 1 , 0 0 0 ) 1-24 25-49 50-99 100-499 500+ FLOATING RATE BY S I Z E ( * 1 , 0 0 0 ) 1-24 25-49 50-99 100-499 500+ BY T Y P E OF C O N S T R U C T I O N SINGLE FAMILY MULTIFAMILY NONRESIDENTIAL 2. L A R G E B A N K S FIXED RATE BY S I Z E ( $ 1 , 0 0 0 ) 1-24 25-49 50-99 100-499 500+ FLOATING RATE BY S I Z E ( $ 1 , 0 0 0 ) 1-24 25-49 50-99 100-499 500+ "lilir 3. O T H E R B A N K S | A V E R A G E I1 A V E R A G E | 1 WEIGHTED | | I AVERAGE | STANDARD SIZE II M A T U R I T Y | | ( $ 1 , 0 0 0 ) II ( M O N T H S ) | ERROR 1 EFFECTIVE! 4/ 3/ ! FIXED RATE BY S I Z E ( $ 1 , 0 0 0 ) 1-24 25-49 50-99 100-499 500+ FLOATING RATE BY S I Z E ( * 1 , 0 0 0 ) 1-24 25-49 50-99 100-499 500+ BY T Y P E OF C O N S T R U C T I O N SINGLE FAMILY MULTIFAMILY NONRESIDENTIAL ! "1 7 . 7 7 - 9 .11 86.9 17.5 .37 .42 .59 .45 .50 .94 0,.40 0..33 0..37 0..49 0..40 0. 31 7.55-8.60 1 0 . 5 2 - 1 2 .18 8 . 8 4 - 9 .93 9 . 9 6 - 1 3 .80 1 1 . 0 2 - 1 3 .24 7 . 5 5 - 8 .37 89.1 56.8 13.4 81.9 13.5 97.3 11.1 .84 .56 .81 .17 .23 .62 0..16 0..08 0,.31 0,.11 0..12 0..13 8.30-9 9.11-9 9.38-11 8.84-9 8.84-9 8.03-8 .38 .96 .56 .92 .92 .85 85.2 71.3 59.4 77 .8 89.5 10.02 8.87 8.42 0.26 0.15 0.29 9.11-11.02 8.70-8.84 7.76-8.84 68.5 94.4 88.8 0.23 7.55-8.70 7.87 10.31 X X X 7.87 0.45 0.60 X X X 0.45 7.55-8..20 9 . 9 2 - 1 0 .47 X X X 7 . 5 5 - 8 .20 97.1 88.3 X X X 97.1 12.7 0.0 x * X 12.7 8.36 9.21 9.27 8.92 8.87 8.32 0.11 0.09 0.16 0.21 0.16 0.12 7 . 7 7 - 8 .84 8.84-9..38 8 . 8 4 - 9 .92 8 . 8 4 - 9 .38 8 . 5 7 - 9 .11 7 . 7 7 - 8 .84 89.1 94.8 94.3 93.2 91.9 88.8 20.9 4.9 3.0 4.2 8.70 8.79 0.23 22.0 0.23 7.76-9.38 11.02-8.70 7.55-8.57 86.1 0.18 213 9 1,460,309 45,221 10,969 17,399 105,388 1,281,332 249 10 30 75 265 10,170 7 6 9 9 23 5 8 11 9 12 11 7 1,930,359 48,236 71,617 72,869 287,233 1,450,403 192 9 37 69 196 3,541 11 9 7 10 12 11 8 9 10 9 9 8 389,673 253,734 2,747,261 42 277 491 13 7 9 2,203,753 1,879 1,222,669 775 X X X 1,219,021 6,218 10 X X X 13,544 3 12 X X X 3 981,085 3,441 3,487 7,729 59,380 907,049 1,005 10 33 73 230 5,843 13 12 11 10 14 13 i ' P E R C E N T A G E OF A M O U N T OF LOANS M A D E UNDER: 1 I PARTICIPATION I C iO M M I T M E N T 1 0. 26 8 .64 3,390,669 ,.«a tia 1/ ! 11 INTERQUARTILE RANGE 5/ 8.00 * FEWER T H A N 10 S A M P L E L O A N S . e 3.4 0.0 1.3 12.4 22.4 0.4 0.8 3.0 2.7 29.1 2.5 5.0 20.8 16.4 98.3 93.1 2.8 22.4 4.6 17.6 1,186,915 81 11 9.65 0.23 8.84-9.92 74.6 19.7 237,641 44,446 10,617 16,871 103,395 62,311 42 10 29 75 265 1,731 21 6 9 8 23 31 10.94 11.44 9.60 12.51 11.55 9.37 0.38 0.41 0.54 0.67 0.52 0.37 9.92-12.13 10.75-12.18 8.84-9.93 9.96-13.80 11.02-13.24 9.18-10.34 48.4 56.3 10.5 82.3 2.6 0.8 949,274 44,796 68,130 65,141 227,854 543,355 105 9 38 68 189 2,136 9 9 7 10 12 8 9.32 9.59 10.89 9.20 9.32 9.12 0.13 0.07 0.52 0.16 8.84-9.42 9.20-9.96 9.39-13.24 8.84-9.92 8.84-9.92 8.84-9.39 355,442 36,591 794,882 39 52 160 13 13 11 10.15 9.36 9.44 0.27 0.17 0.30 9.38-11.02 9.11-9.92 8.84-9.39 0.06 0.19 M O T E : 5 3 . 8 P E R C E N T O F C O N S T R U C T I O N A N D L A N D D E V E L O P M E N T L O A N S H E R E P R I C E D R E L A T I V E TO T H E P R I M E R A T E S E E LAST P A G E FOR F O O T N O T E S 62.0 0.8 2.3 0.0 12.2 100.0 0.7 7.7 81.2 23.9 69.5 57.6 58.3 74.1 90.8 66.8 71.4 78.3 0.1 0.7 2.8 2.7 40.2 0.6 7.4 28.7 Table 5 LOANS TO FARMERS Size class of loan# (thousands) all sizes ALL BANKS Amount of loans (thousands) Number of loans Weighted average maturity (months)2 Weighted average interest rate (%>3 Standard error4 Interquartile range5 By purpose of loan: Feeder livestock Other livestock Other current operating expenses Farm machinery and equipment Farm real estate Other Weighted average interest rate (%)3 Standard error4 Interquartile range9 By purpose of loan: Feeder livestock Other livestock Other current operating expenses Farm machinery and equipment Farm real estate Other Percentage of amount of loans: With floating rates Made under commitment By purpose of loan: Feeder livestock Other livestock Other current operating expenses Farm machinery and equipment Farm real estate Other $10-24 $100-249 $50-99 $25-48 $250 and over $1,046,760 4J,767 10.9 $106,737 28,010 7.9 $135,565 9,075 9.4 $97,908 2,871 7.1 $126,118 1,912 14.4 $227,717 1,539 15.5 $352,714 360 8.5 10.20 .56 8.51-11.63 11.59 .58 10.51-12.43 11.18 .67 10.25-12.15 11.06 .79 10.25-11.90 10.80 .69 9.58-11.80 10.78 .82 9.96-11.83 8.59 .80 9.00 9.72 • 10.74 10.97 7.76- 8 . 86 10.62 9.86 10.42 11.20 10.72 8.99 11.63 11.21 11.61 11.45 11.67 11.77 11.37 1 1 . 17 11.28 1 0 . 72 10.79 10.79 11.39 10.46 11.17 11.27 10.02 10.27 8.86 8.25 65.1 47.4 43.5 30.5 42.5 32.1 42.5 31.5 57.4 40.0 55.9 34.3 95.2 73.8 13.1 7.2 55.0 3.4 4.4 16.9 12.4 7.3 60.3 9. 1 1.8 9.1 17.0 10.2 51.6 3.1 7.5 10.6 26.2 4.4 54.6 3.7 9.9 12.9 $381,624 3,825 8.9 $6,706 1,740 8.8 $11,464 784 10.7 $14,757 421 9.3 $23,641 347 8. 1 8.47 .52 9.00 10.07 .53 9.30-10.43 9.39 .64 9.92 9.22 .75 9.84 9 . 30 .60 9.84 8.96 8.02 8.37 9.73 9.00 8.44 9.77 9.60 9.78 12.08 10-73 9.91 Percentage of amount of loans: With floating rates Made under commitment By purpose of loan: Feeder livestock Other livestock Other current operating expenses Farm machinery and equipment Farm real estate Other LARGE BANKS" Amount of loans (thousands) Number of loans Weighted average maturity (months)2 $1-9 7.76- 8.77- 9.05 e 9.51 10.06 * 8.51- 8.79 $ 9.47 9.58 $ # $ $ * 50.2 67.6 $ $ * # # 9.32 7.3 * $ 9 . 19 * 13.9 14.3 8.77- $ * * 44.6 * 8.86 10.93 * * * * * $ 30.9 7.7 $45,228 325 10. 1 8.52- 9.00 .78 9.50 9.03 $ 9.21 * $ $279,829 208 8.6 7.76- 8 . 19 .21 8.30 8 . 86 $ 8.04 $ $ 9.44 9.17 9.49 8.86 8.25 - 93.7 78.5 78.2 65.2 91.4 78.1 93.4 76.4 91. 1 86.3 96.4 83.5 93.9 77.5 12.4 9.7 38.1 1.5 1.7 36.5 11. 1 3.9 56. 1 10.9 2.9 15. 1 26.8 • 39.4 3.1 21.7 18.7 22.8 9.2 $665,136 39,942 11.5 $ * * 28. 1 42.7 6.6 41.6 23.8 16.9 28.3 38.6 $100,032 26,269 7.8 $124,102 8,291 9.3 $83,151 2,450 6.8 $102,477 1,565 15.2 $182,489 1,214 16.5 1 1.20 .21 10.51-11.95 11.69 .23 10.78-12.47 11.34 . 18 10.38-12.31 11.39 .21 10.59-12.05 1 1 . 15 .33 1 0 . 2 b - 11. 8 8 11.22 .21 11.02-11.83 11.50 11.64 11.11 11.47 11.00 11.09 11.74 11.26 11.73 11.40 11.78 11.99 11.73 11.22 11.40 11.76 48.6 29.5 41. 1 28. 1 37.9 27.8 $ $ $ # $ * 38.7 $ $ 39.0 11 OTHER BANKS Amount of loans (thousands) Number of loans Weighted average maturity (months)2 3 Weighted average interest rate (%) Standard error4 Interquartile range5 By purpose of loan: Feeder livestock Other livestock Other current operating expenses Farm machinery and equipment Farm real estate Other Percentage of amount of loans: With floating rates Made under commitment By purpose of loan: Feeder livestock Other livestock Other current operating expenses Farm machinery and equipment Farm real estate Other See last page for notes to tables •Fewer than 10 sample loans 13.5 5.8 64.6 4.5 6.0 5.0 12.5 7.5 60.6 9.0 1.7 8.7 $ 10.83 11.10 lb. 1 10.9 52.8 $ 11.40 11.07 # $ 11.08 $ $ $ * * * $ 33.5 23.5 27.0 $ 56.8 $ 7.8 9.3 $ * # $ * 49.6 29.4 $ $ 45.3 45.9 22.1 $ $ 77.4 • * $ $ $ * $ * * $ # $ • # $ $ $ * * $ # $ # $ # $ NOTES The survey of terms of bank lending to business collects data on gross loan extensions made during the first full business week in the mid- month of each quarter by a sample of 340 commercial banks of all sizes. A subsample of 250 banks also report loans to farmers. The sample data are blown up to estimate the lending terms at all insured commercial banks during that week. The estimated terms of bank lending are not intended for use in collecting the terms of loans extended over the entire quarter or residing in the portfolios of those banks. Construction and land development loans include both unsecured loans and loans secured by real estate. Thus, some of the construction and land development loans would be reported on the statement of condition as reals estate loans and the remainder as business loans. Mortgage loans, purchased loans, foreign loans, and loans of less than $1,000 are excluded from the survey. 1. As of December 31, 1985, assets of most of the large banks were at least $ 5.5 billion. For all insured banks, total assets averaged $ 165 million. 2. Average maturities are weighted by loan size and exclude demand loans. 3. Effective (compounded) annual interest rates are calculated from the stated rate and other terms of the loan and weighted by loan size. 4. The chances are about 2 out of 3 that the average rate shown would differ by less than this amount from the average rate that would be found by a complete survey of lending at all banks. 5. The interquartile range shows the interest rate range that encompasses the middle fifty percent of the total dollar amount of loans made. 6. The most common base rate is that rate used to price the largest dollar volume of loans. Base pricing rates include the prime rate (sometimes referred to as a bank's "basic" or "reference" rate); the federal funds rate; domestic money market rates other than the federal funds rate; foreign money market rates; and other base rates not included in the foregoing classifications; 7. Overnight loans mature on the business day after they are made. 8. Demand loans have no stated date of maturity. 9. Nominal (not compounded) annual interest rates are calculated from survey data on the stated rate and other terms of the loan and weighted by loan size. 10. The prime rate reported by each bank is weighted by the volume of loans extended and then averaged. 11. The proportion of loans made at rates below prime may vary substantially from the proportion of such loans outstanding in banks' portfolios. 12. Among banks reporting loans to farmers (Table 5), most "large banks" (survey strata 1 to 3) had over $ 600 million in total assets, and most "other banks" (survey strata 4 to 6) had total assets below $ 600 million.