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REVISION

-OfCOVf-

VA

FEDERAL

RESERVE

s t a t i s t i c a l

>'

r e l e a s e

• :

" '

:: •
'

May 28, 1971
X

•

REVISlg^KOF QUARTERLY SURVEY OF INTEREST RATES ON BUSINESS LOANS
I
' '
.... /
'
The Quarterly Survey of Interest Rates Charged by Banks on Business.
Loans has been revised beginning with the survey period for February 1971:
The revisioh incorporates a number of technical changes in coverage, sampling J
and, interest rate calculations.

These include elimination of accounts receivable

loans from the survey, shortening the.sample period for respondent banks in
most districts, arid calculation of effective annual interest rate? -on

[

discounted loans using a revised formula based on annual rather ttian quarterly
compounding of interest.•, As a result of the above changes, new weights
derived from this Survey have been used to calculate the weighted average rates.^
To determine the impact of the revision, separate" information„on
accounts receivable loans were collected in the February survey, and interest
rate computations were made on the former basis for comparison with the revised,
series.

The net effect of changes made in the Survey revision was to reduce

the average rate for short-term business loans for 35 centers by .17 percentage point, to 6.58 per cent on the revised basis, compared to 6.75 per cent
on the former basis.

The major factor lowering the average interest rate in

most areas was the elimination of accounts receivable from the sample of.
loans reported, which accounted for .13 percentage point of the reduction.

The

change in weights also reduced the average rate, by .08 percentage point,
and the shift to annual compounding of interest increased the average rate
by .04 percentage point.

Regional changes in rates ranged from a reduction

of .01 percentage point for New York City to a reduction of .38 percentage
point in Other Northeast. centers.
Beginning with,the February survey, the E.2 release will be expandedto provide interest rate data.for term loans and revolving credit as well as
for short-term business- loans.

A description of the revised survey will

be published in the June Federal Reserve Bulletin.




•

Table

1

Bank Rates on Short-term Business Loans
February 1971

Interest rate
(per cent per annum)

6.00
6.01
6.50
6.51
7.00
7.01
7.50
7.51

8.00

than 6.00
- 6.49 .
- 6.99
- 7.49
- 7.99

8.00

Total per cent

Total - Dollar amount*
Total - Number of loans

Percentage distribution of do)la:
$1,000-$9,999
.$10, 000-$99, 999
$10(^,000-$499, 999
Revised
Revised
Eormer
Revised
Former
.Series
Series

Revised
Seriep
1.4
42.4
17.4 .
7.7
6.5
5.6
4.5
2.4
.
2.1
2.7
7.4
100.0 ,
3,047,996
17,915

1.3
39,9
16.4
7.5
7.5
5.8
3.7
2.6
1.7
3.1
10.3

100.0

3,238,664
20,205

1.2
2.4 '
2.8
3.5
3. 1
7.5
5.5
7.5

3.1
3.7
2.4

8. 1
7.9
8.7
13.2
42.8

8.6
12.6
45.4
100. 0

100.0

24,776
6,138

-27,452
6,702

0.9
6.3
6. 6

4.6
9.8
10.2
10.5
6.8
7.4
7.2

0.7
19.5

9.4
8.1
6.8
6. 1
. 7.6
3t.5

12.3
•11.2
7.1
7.8
4.5
3.7
3.4

100.0
236,576
7,634

281,686
8,452

$1,000.000 and ,
Revised
-Series

Former

31.7
25.5
10.8
5.2
5.4
5*2
2.9

Series
0.8

100.0

18.6
10.6

0.7
17.6
16.7
' 11.4
11.7
7.1

$500,000-$999,999
Revi sed

Series
0.8

520,046
2,735

100.0

29.8
24.0
10.4
5.9
5.8 .
4/2
3.7
1.7
3.5
10.3
100.0

585,879
3,077

385,424
626

410,058,
663

6. 6
4.8
3.2
3.9
16.4

•

1.8

3.0
7.6

• 1.7
55.9 .
17.0
• 5.5
5. 1
4.5
2.6

1.0.

1.0

1.8
3.8

100.0

,881,174
782

WEIGHTED AVERAGE RATES (per cent per annum)
35 centers

6.58 -

8.12

6.27
7.18
6.83
7.04
6.72
6.81

7.76
8.27
7.76 »
8.23
7.83
8.38

7.60
8.34
7.77
8.20
7.89
8.61

7.49

7.65

7.20
7.10
7.75
8.05
7.28
7.40
7.72
7.73
7.22
7.38
'
8.04
7.77
rly Survey of Interest Rates on Business Loans was revised.

June Federal Reaerve Bulleti
• - Dollar amounts in

8.05

6.26
6.80
6. 65
6.88
6.59
6.63 •

New York City
7 Other- Northeast
8 North Central
7 Southeast
8 Southwest
4 West Coast

6.75

thousands.




6.91

-7.02

6.57
6.50
7.11
7.36
7.82
7.05
7.00
7.05
6.82
6.83
7.15
7.30
A description of the

6:. 64
6.35
6.97
6.57
6.69 6. 63
6.77
revised

6.68

6.35

6.18
6.31
6.40
7.13
6.54
6.65
-6.66
6.55
6.25
6.64
6.32
6.91
series is planned

6.41
6.16
6.39
6.70"
6.51
6,26
6.32
for the

*

"

;

E.2

..
.

-

Table 2
B a n k R a t e s on L o n g - t e r m B u s i n e s s Loans —
F e b r u a r y 1971

Interest rate
(per cent per annum)
Less
6.00
6.01
6.50
6.51
7 • 00
7.01
'7.50
7.51
8.00
Over

than 6.00
- 6.49
- 6.99
- 7.49
.
- 7.99

—i-... - .
.

8.OP
Total per cent

Percentage distr ibution of dollar amount by si
S10,000-$99,999
$100;00Q-$499,999
Revised J F o r m e r
Revised
Former

Revised F o r m e r

Revised
0.8
14.0
11.0
32.1
7.0
12.1
6.5
6.1
0.9
4.9
4.4
100.0

0.8
13.9
10.9
31.9
7.0
12-.6
6.4
6.1
0.9
4.9
4.4
100.0

4.0
•6.0
1.3
14.2
4.2
3.3
0.9
12.9
1j5
14.0
37.9
100.0

100.0

0.4
0.4
7.8
7.7
4.9
5.0
15.8
15.6
5.8
5.6
12.8 13.7 ,
4.6
4.5
16.2
15.9
2.4
2.4
. 8-6 ' ,
8.5
20.8
20. 7
100.0',
100.0

•

100.0

0.4
5.9
7.3
4.2
4.2 "
13.9
30.2
35.7
6.7
1.7
14.9
14.4
' 2.5
4.5
5.0
-;s.5
1.8
9.0
2.7
8.5
17.9
~

5.7
4.1
13.5
34,6
1.7
16.9
4.4
8.2

•

-

<

2.6
8.3

__
17.4
12.3
.'32.98.1
1.1.3
7.8
5.3
0.7
4.2

100.0

100.0

100.0 :

100.0

17.4
12.3 ""
32.9
8.1
11.3
7.8
5.3
0.7 .
4.2
100.0

247,655

551

559

10,089

10,231

36,202

36,652

29,131

30,031

170,182

170,182

624

632

114

115

250

253

161

164

42

43

57

57

Total - Number of loans

6.81

35 centers
New York City
7 Other Northeast
8 North Central
7 Southeast
8 Southwest
4 W e s t Coast

,

6.81
7 i 00
6.96.
7.22
7.04
6.57

8.42

6.90

6.81
7.09
6.92
7.22
6.99
6,46

WEIGHTED .AVERAGE RATES

0

8.38

7.08
10.36
7.56
8.37
6.90
7.64

7.01
9.85
7.61
8.10
6.96
7.62

7.58 .
6.75
7.97
7.39
7.62
. 7.84
7.21

(per cent per annum)
"

7.55

7.32

, 7.37

6.91

6.98

6.64

6.76

6.82
8.02
7.41
7.61
7.66
7.19

6.80
7.62
7.28
7.59
8.06
7.41

6.78
7.55
7.29
7.44
7.90
7.30

6.56
6.80
7.52
6.50
6.82
6.81

6.56
6.80
7.52
6.50
6.84
6.81

6.83
6.72
6.77
7.00
6.71
6.32

6.83
6.72
6.77
7.00
6.71
6.32

series

is planned

Beginning February 1 9 7 1 the Quarterly Survey of Interest Rates on Business Loans was revised.
Federal Reserve Bulletin.

* - Dollar amounts in

0.4
7.4
,4.3
30.6
6.5
14.1
2.5
5.1
1.8
9.1
18.1

$1,000,000 and over
Revised
Former

246,155

Total - Dollar amount*

1/

4.0
5.9
2.7
14.0
4.1
3.2
1.8
12.8
0.5
13.8
37.4

'$500,000-5999,999
Revised
Former

thousands .




4

A d e s c r i p t i o n of t h e revised
"

1

for the June

Table

3

Bank Rates on R e v o l v i n g Credit
F e b r u a r y 1971

Interest rote
(per cent per annum)
Less
6.00
6.01
6.50
6.51
7.00
7.01
7.50
7.51
8.00
Over

than

$1.000Revised

0. 1

6.00

51.5
• 16.9
13.1
6.7
3.7
1.5
2.8

- 6.49
- 6.99
- 7.49

0.1

- 7.99

1.8
8.00
Total.pet cent
• Dollar amount*

1.8
100.0

Former
0.1
48.5

16.-0
12.4
6. 6
4.8
2.1

0.5
14.2
8.5
2.4 <

Percentage distribution of
OOO
fid non fnn n ™
$9.999
$10,000-$99.999
Former
Revised
Former
Series
...Series .
-0.5
0,8
10.4
18.0
12.8
6.2
10.6
7.6

2.6

13.3
10.4
9.5

10.0
8.6

1.1
2.1
2.9

8.4
7.»
1.6
2.5
3.8
33.6
16.7

4.6
24.7
28.7

14.4

100.0

10.2
6.7
11.9
2.7
5.9
22.9

100.0

100.0

LOO. 0

100.0

3.3 ,

1,156,684

• Number of loans

Revised

Business loans-

1,228,033

1.334

•1.72n

825

198

6.1
7.0
3:2

6.1

4.6
3.1
6.3

1,122

15,262

21,628

254

402

591

dollar amount by size of 1
- . „„
1 . -1
!
l~ :
$ 100,000-$499.999
$500,000-$999. 999
Revised
Revised
Series

0.6
37.1
13.8
15.. 4
4.3
9.3
2.3
4.8
1.1
„ 2.9

28.1
10.8
12.5
4.0

44.2
13.2
19.1
3.7
7.9
4.0
3.2

0.5
37.1
11.1
16.4
4.9
12.3
4.8
6.2

6. 34
6.25
6.57
6.48

6.47

7.51

7.98

6.26
6. 65
6.64
6.80
8.53
7.76
6.59
6.53
6.65
6.89
6. S 2 V
8.00
8.01 .
6.74
6.90
7.26
7.54
6.30
6.48
•
8.25
Beginning February. 1971 the (
Quarterly Survey of Interest: Rates on Business
Federal Reserve Bulletin.

• Dollar amounts in

thousands.




7.06

9.2

2.7
14.5

4.3

100.0

100.0

6.2
100.0

1.8
0.7

100.0

100.0

100.0

103,641

123,362

963,037

.

73,-919

'

.A3. 6
5.7
7.0

1.2

97,383

212_ — A 1 L .

7.54

6.88

6.89
7.87
6.90
8.97
7.30
7.68

7.95
6.67
7.91
7.03
7.14

54&0 '
17.7
12.3
7.1
2.7
1.1
2.5

52.8
17.3
12.0
7.0
2,8
1.4
-2.4
1.2
2.2
0.8

"

0.4

,

LLZ-

LS5_

WEIGHTED AVERAGE RATES (per cent per annnm)

New York City
7 Other Northeast
8 North Central
7 Southeast
8 Southwest 1
4 West Coast

$1,000.000 <

2Ml

6.98
6.54
6. 56
6.49
7.22
'7.63
6.64

6.43

6.54

6.54
6.93 '

6.27
6.28
6.57

6.27
6.70
6.59

6.24

6.28

6.12

6.87

6.47

series

is planned

6.81
8.19
7,59
7.04

6.28
6. 65

6.42

A d e s c r i p t i o n of the revised

6.60

6.60
6.46

6.25

for the June