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Content last modified 6/05/2009.

CONFIDENTIAL (FR)

SUPPLEMENT
CURRENT ECONOMIC AND FINANCIAL CONDITIONS

Prepared for the
Federal Open Market Committee

December 14, 1973
By the Staff
Board of Governors
of the Federal Reserve System

A - 1

APPENDIX A:

QUARTERLY SURVEY OF CHANGES IN BANK LENDING PRACTICES
November 1973

The large majority of the 125 banks reporting in the November
15, 1973, Quarterly Survey of Changes in Bank Lending Practices were
following essentially unchanged policies from three months earlier,
when most banks reported that their policies had firmed. (See Table 1.)
However, a significant minority of banks reported that their policies
had firmed moderately in the most recent period, but a few banks did
report some easing. In the preceding survey, virtually no easing was
reported. Loan demand at the vast majority of banks had remained
unchanged or weakened, and these trends generally were expected to continue. Detailed examination of the responses to the survey, though,
revealed that the moves toward tightening seemed to represent lagged
responses of banks to stronger loan demands in previous periods as
well as increased demands for credit in the current period.
There were modest moves toward greater firmness in nonprice
terms of lending such as compensating balances and standards of credit
worthiness. Banks also had a somewhat more stringent attitude toward
new and nonlocal customers and scrutinized more closely the value of
loan applicants as depositors or as a source of collateral business.
There were no significant divergences between the policies of
smaller and larger banks with respect to price and nonprice terms of
lending (Table 2). Regionally, the pattern was fairly consistent as
bankers generally were guided by policies adopted earlier this year
(Table 3).

*Prepared by Paul W. Boltz, Economist, Banking Section, Division of
Research and Statistics.

NOT FOR QUOTATION OR PUBLICATION

TABLE

1

QUARTERLY SURVEY OF CHANGES IN BANK LENDING PRACTICES
AT SELECTED LARGE BANKS IN THE U.S. 1/
(STATUS OF POLICY ON
NOVEMBER 15, 1973
COMPARED TO THREE MONTHS EARLIER)
(NUMBER OF BANKS & PERCENT OF TOTAL RANKS REPORTING)
MUCH
STRONGER

TOTAL
BANKS

PCT

RANKS

PeT

MODERATELY
STRONGER

ESSENTIALLY
UNCHANGED

MODERATELY
WEAKER

BANKS

RANKS

BANKS

PCT

PCT

PCT

MUCH
WEAKER
BANKS

PCT

STRENGTH OF DEMAND FOR COMMERCIAL ANn
INDUSTRIAL LOANS (AFTER ALLOWANCE FOR
BANK'S USUAL SEASONAL VARTATIO)
COMPARED

TO THREE MONTHS AGO

ANTICIPATED DEMAND IN NEXT 3 MMNTHI

125

100.0

0

0.0

22

17.6

53

42.4

50

40.0

0

0.0

124

100.0

1

0.8

16

12.9

69

55.7

37

29.8

1

0.O

ANSWERING
QUFSTION
RANKS

PCT

MUCH
FIRMER
POLICY
RANKS

PCT

MODERATELY
FIRMFR
POLIY

ESSENTIALLY
UNCHANGED
POLICY

MODERATELY
EASIER
POLICY

BANKS

RANKS

BANKS

PCT

PCT

PCT

MUCH
EASIER
POLICY
BANKS

PCT

LENDING TO NONFINANCIAL BUSTNESSFS
TERMS AND CONDITIONS:

M

INTEREST HATES CHARGED

12b

100.0

9

7.2

27

21.6

60

48.0

29

23.2

0

0.0

COMPENSATING OR SUPPORTING BALANCE

124

100,0

4

3.P

18

14.q

98

79.1

4

3.2

0

0.0

STANDARDS OF CREDIT WORTHINESS

124

100.0

4

3.2

20

16.1

98

79.1

2

1.6

0

0.0

MATURITY OF TERM LOANS

124

100.0

1

0.R

16

12.9

99

79.8

8

6,5

0

0.0

ESTABLISHED CUSTOMERS

125

100.0

1

0.8

15

12.0

96

76.8

13

10.4

0

9.0

NEW CUSTOMERS

125

100.0

9

7.2

30

24.0

65

52.0

21

16.8

0

0.0

125

100.0

1

nR

16

12.8

94

75.2

14

11.2

0

0,0

125

100.0

10

8.0

25

20.0

78

62.4

12

9.6

0

0.0

REVIEWING CREOIT LINES OR LOAN APPLICATIONS

LOCAL SERVICE

AREA CUSTOMERS

NONLOCAL SERVICE AREA CUSTOMERc

1/ SURVEY OF LENDING PRACTICES AT 12f
AS OF
NOVEMBER 159 1973.

LARGE HANKS REPORTING IN THE FEDERAL RESERVE QUARTERLY

INTEREST RATE SURVEY

NOT FOR QUOTATION OR PUBLICATION

TABLE 1

ANSIERING
QUFSTION
RANKS

PCT

(CONTINUED)

MUCH
FIRMER
POLICY
RANKS

PCT

MODERATELY
FIRMER
POLIrY
BANKS

PCT

FSSENTIALLY
UNCHANGED
POLICY

MODERATELY
EASIER
POLICY

RANKS

BANKS

PCT

PCT

MUCH
EASIER
POLICY
BANKS

PCT

FACTORS RELATING TO APPLICANT 2/
VALUE AS DEPOSITOR OR
SOURCE OF COLLATERAL BUSINESS

125

100.0

17.

90

72.0

INTENDED USE OF THE LOAN

125

100.0

13.6

96

76.8

INTEREST RATES CHARGED

100.0

13.6

88

70.4

COMPENSATING OR SUPPORTING HALANCF

100.0

113

90.4

1.6

ENFORCEMENT OF BALANCE PEQIIRE-4ENTR

100.0

13.6

101

80.8

1.6

100.0

12.0

88

70.4

9.6

LENDING TO
TERMS AND

"NONCAPTIVF" FINANCE COMPANIES
CONDITIONS:

ESTABLISHING NEW

OR LARGEP CREDIT IINES

ANSWERING
QUESTION
RANKS

PCT

6.4

CONSIDERARLY
LESS
WILLING
RANKS

PCT

MODERATELY
LESS
WILLING

FSSENTIALLY
UNCHANGED

BANKS

RANKS

PCT

PCT

12.8

MODERATELY
MORE
WILLING
BANKS

PCT

WILLINNESS TO MAKE OTHFR TYPES OF LOANS

100.0

1.6

12

9.6

92

73.6

15.2

CONSUMER INSTALMENT LOANS

100.0

0.0

2

1.6

105

84.7

12,9

SINGLE FAMILY MORTGAGE LOANS

100.0

7.4

16

13.1

83

68.0

11.5

MULTI-FAMILY MORTGAGE LOANS

100.0

16

13.2

84

69.4

5.8

ALL OTHER MORTGAGF LOANS

100.0

5.7

17

13.R

91

74.0

6.5

TERM LOANS

TO RUSINFSSES

11.6

PARTICIPATION LOANS WITH
CORRESPONDENT RANKS

125

100.0

1

0.8

11

8.8

99

79.2

LOANS TO

125

100.0

5

4.0

13

10.4

102

81.6

BROKERS

2/ FOR THESE FACTORS, FIRMER MEANS TwE FACTORS WERE CONSIDERED MORE IMPORTANT
AND EASIER MFANS THEY WERE LESS IMPORTANT.
CREDIT REQUESTS

11.2

IN MAKING DECISIONS FOR APPROVING

4.0

CONSIDERABLY
MORE
WILLING
BANKS

PCT

NOT FOR QUOTATION OR PUBLICATION

TABLE 2

COMPARISON OF QUARTERLY CHANGES IN BANK LENDING PRACTICES AT BANKS GROUPED BY SIZE OF TOTAL
(STATUS OF POLICY ON
NOVEMBER 15, 1973, COMPARED TO THREE MONTHS EARLIER)
(NUMBER OF BANKS IN EACH COLUMN AS PER CENT OF TOTAL BANKS ANSWERING QUESTION)

SIZE

TOTAL

OF RANK

MIUCH
STRONGER

$1

UNDFH

1oo

Inn

0

0

1o0

Iion

2

0

&

nvr

TOTAL OFPOSITS

MODERATELY
STRONGER

S1 &
OVER

$1

--

UNnER
;1

i$ &
OVER

UNDER
SI

DEPOSITS

1/

IN BILLIONS

ESSENTIALLY
UNCHANGED

MODERATELY
WEAKER

$1 &
OVER

Sl &
OVER

UNDER
51

UNDER
Si

MUCH
WEAKER
51 &
OVER

UNDER
Sl

STRFNGTH OF IEMAND FOR COMMERCIAL AN
INDUSTRIAL LOANS (AFTER ALLOWANCE FOR
RANK'S USUAL SEASONAL VARTATIOt)
COMPARED

TO

ANTICIPATED

THREE

MONTHS

DEMANP

IN

AGO

NFXT

3

MONTHs

TOTAL

sI &
LENDING TO NONFINANCIAL

IJNnFP

MUCH
FIRMER

1l &
OVFR

MODERATELY
FIRMER

UNPER
1l

$1 &
OVER

IUNDFR
$1

FSSENTIALLY
UNCHANGED

MODERATELY
EASIER

«1 &
OVER

$1 &
OVER

UNDER
$1

UNDER
51

MUCH
EASIER

SI &
OVER

UNDER
51

0 VER

$1

100

100

In

15

50

46

31

17

Inn

Io

4

9

R3

76

6

1

0

0
0
0

HIISTNESSFS

TERMS AND CONDITIONS:
INTEREST RATES CHARbEO
COMPENSATING OR SUPPORTING

MALANCES

STANDARDS OF CREDTT wnRTHINESS

85

75

4

0

0

MATURITY OF TERM LOANS

90

72

6

7

0

REVIEWING CREDIT LINES OR LOAN APPLICATIONS
ESTABLISHED CUSTOMERS

7

15

78

77

15

7

NFW CUSTOMERS

100

100

9

2P

53

51

22

13

LOCAL SERVICE AREA CUSTOMFRS

100

100oo

7

17

76

75

17

7

NONLOCAL SERVICE

100

100

7

23

64

60

17

4

ARFA CUSTOMERS

1/ SURVEY OF LENDING PRACTICES AT
5S LARGE BANKS (DEPOSITS OF $1 RILLION OR MORF) AND
71 SMALL BANKS (DEPOSITS OF LESS THAN
19 HILLION) REPORTING IN THE FFDERAL RESERVE QUARTERLY INTEREST RATE SURVEY aS OF
NOVFMBER 159 1973.

NOT FOR

QUOTATION

OP PUBLICATION

TAB'.E

2

(CONTINUED)

1I7t

OF RANK
MUCH
FIRMEP
POLICY

NUMBER
ANSWERING
OUESTION
$1 &
OVFR
FACTORS

RELATING TO

APPLICANT

inn

INTENDED USE OF THE LOAN

100

TO "NONCAPTIVE"

1

.1 &

OVER

UNnER
191

$1 &
OVER

UNDER
$1

Sl &
OVER

UNDER
$1

$1 &

()VER

UNDER
$1

MUCH
EASIER
POLICY
51 &
OVER

UNDER
1S

2/

VALUE AS DEPOSITOR OR
SOURCE OF COLLATERAL PUSINESS

LENDINb

UNDER
S1

-TOTAL DEPOSTTS IN BILLIONS
0ODERATELY
FSSENTIALLY
MODERATELY
EASIER
FIRMFR
UNCHANGED
POLICY
POLIrY
POLICY

100

0

0

n10

FTNPNCE rOMP-NIFS

TERMS ANO CONDITIONq:
INTEREST RATES CHARGfD
COMPENSATING OR SUPPORTING HALANCE;
ENFORCEMFNT OF HALANCF REOUIRF"ENT(;
ESTABLISHING NEW

OR LARGER CREnIT LINES

NUMREFP
ANSWERING
QUPSTTON
&
$1
OVER

UNOFR
$1

CONSIDERARLY
LFSS
WILLING
$1 &
OVER

UNnFR

41

MODERATELY
LESS
WILLING
$1 &
OVER

UNDFR

S1

FSSENTIALLY
UNCHANGED

51

&
OVER

UNDER
Sl

MUDERATELY
MORE
WILLING
51 &
OVER

UNDER
S1

WILLINGNESS TO MAKE OTHER TYPES OF LANS
TERM LOANS TO RUSTNFSSFS
CONSUMER
SINGLE

INSTALMENT LOANS

FAMILY MORTGAGF LOANS

MULTI-FAMILY MORTGAGE LOAMS
ALL OTHER MORTGAbF

LOANS

PARTICIPATION LOANS WITH
CORRESPONDENT BANKS
LOANS TO BROKERS

loo
100
100

Ion
100
10

e/ FOR THESE FACTORS, FIRMER MEA"IS THE FACTORS WERE CONSIDERED MORE
CREDIT REQUESTS9 AND EASTER MFANS THEY WERE LESS IMPORTANT.

81

78

85

79

IMPORTANT IN MAKING DFCISIONS FOR APPROVING

CONSIDERABLY
MORE
WILLING
S1 L
OVER

UNDER
Sl

NOT FOR QUOTATION OF PUBLICATION

TABLE 3

QUARTERLY SURVEY OF CHANGES IN BANK LENDING PRACTICES AT SELECTED LARGE BANKS IN THE U.S.
STATUS OF POLICY ON
NOVEMBER 15, 1973
COMPARED TO THREE MONTHS EARLIER
(NUMBER OF RANKS)

ALI.
DSTS

NEW YORK
BOSTON
TOTAL CITY OUTSIDE

PHILADFL.

CLEVE- RICHLAND
MONO

ATLAN- CHICAGO
TA

ST.
LOUIS

1/

MINNE- KANS.
CITY
APOLIS

DALLAS

SAN
FRAN

STRENGTH OF DEMAND FOR COMMERCIAI ANII
INDUSTRIAL LOANS (AFTER ALLOWANCE FOR
BANK'S USUAL SEASONAL VARIATION)
COMPARED TO 3 MONTHS AGO
MUCH STRONGER
MODERATELY STRONGER
ESSENTIALLY UNCHANGED
MODERATELY WEAKFR
MUCH WEAKER
ANTICIPATED DEMAND NEXT
THREt MONTHS
MUCH STRONGER
MODERATELY STRONGFR
ESSENTIALLY UNCHANGED
MODERATELY WEAKER
MUCH WEAKER

12'4
n
2>
51
5n

0
6
1
1
0

0
2
10
f
0

0
0
4
5
0

0
2
6
3
0

0
]
1
0

0
0
5
6
0

1
3
3
1
0

0
4
11
5
0

0
1
6
?
0

0
3
5
3
0

0
1
4
1
0

0
0
9
2
0

2
2
4
0
0

2
4
10
4

0
1
6
?
0

2

0

3
4
2
0

1
4
1
0

1
4
3
0
0

1
5
13
1
0

0
0
8
1
0

1
5
5
0
0

0
A
0
0

p

5
a
0

0
2
4
3
0

O
0
3
0
0

0
1
5
3
0

0
3
4
2
0

0
0
4
9
0

2
3
4
1

0
3
4
B
0

0
1
7
1
0

0
0
2
1
0

0
0
5
4
0

0
1
6
1
0

0
1
9
3
0

0
6
6
0
0

0
3
6
1
0

2
1
7
5
0

2
1
4
2
0

0
1
2
0
O

0
1
4
4
0

1
3
3
2
0

0
2
3
8
0

2
10
0
0

2
8
0
0

0
14
0
0

1
0
8
0
0

0
0
3
0
0

0
1
7
0
0

0
2
7
0
0

0
2
9
2
0

0
2
5
5
0

0
3
4
3
0

0
0
6
6
0

0
2
7
2
0

0
0
10
1
0

0

2

124
1
1A

AJ
37
1

0

LENDTNb TO NONFINANCIAL
BUSINESSES
TERMS

AND CONDITIONS

INTEkFST RATES CHARGED
MUCH FIRMER POLICY
MODERATELY FIRMFR POLICY
ESSFNTTALLY UINCHANGEI) POLICY
MODERATELY EASIER POLICY
MUCH EASIER POLICY
COMPENSATING BALANCES
MUCH FIRMER POLICY
MODERATELY FIRMER POLICY
ESSENTIALLY UNCHANGFD POLICY
MODERATELY EASIFR POLICY
MUCH EASIER POLICY

17?

4
27
(i
20
'
124

1
94

0

1/ SURVFY OF LENDING PRACTICES AT 12b LARGE BANKS REPORTING IN THE FEDERAL RESERVE QUARTERLY
AS OF
NOVEMBER 15. 1973.

INTEREST RATE SURVEY

a
o

NOT FOR

QUOTATION

OR PUBLICATION

TABLF 3

ALI
DSTs

8OSTON

NFW YORK
TOTAL CITY OUTSIDE

(CONTINUED)

PHTLAnFL.

CLEVE- RICHLAND
MOND

ATLAN- CHICTA
AGO

ST.
LOUIS

MINNE- KANS.
CITY
APOLIS

DALLAS

SAN
FRAN

LENDIN6 TO NONFINANCIAL
BUSINESSES
TERMS AND

CONDITIONS

STANDAROD

OF

CREDIT WORTHINESS

124

MUCH FIRMER POLICY
MODERATELY FIRMFR POLICY
FSSENTIALLY UNCHANGED POLICY
MODERATELY EASIER POLICY
MUCH EASIER POLICY

4
2"
94
P

MATURITY OF TERM LOANS
MUCH FIRMER POLICY
MODERATELY FIRMFR POLICY
ESSFNTIALLY UNCHANGED POLICY
MODERATELY EASIER POLICY
MUCH EASIER POLICY

1
3
4
0
0

1
5
14
0
0

0
0
q
0

1
5
5
0
0
0

n
1
5
0

0
2
9
0
0

0
3
9
0
0

0
1
9
0
0

1
2
12
0
0

0
2
7
0
0

0
0
3
0
0

1
1
6
0
0

0
0
9
0
0

0
0
11
2
0

0
1

0
2
10
0
0

0
1
9
0
0

0
1
13
1
0

0
2
6
1
0

0
1
2
0
0

1
1
5
1
0

0
0
7
2
0

0
0
12
1
0

0
3
0

1
8
0

0
0
8
1

0

0

0

0

0
1
2
0
0

0
2
5
2
0

0
2
5
2
0

1
2
5
5
0

0
3
0
0

0
2
6
1
0

0
8
1
0

0
0
9
4
0

0

124
1
16
9c
f

0
4
4
0
0

0
3
17
0
0

0
0
9
0
0

0
3
8
U
0

0
n

0
4
4
0

1
4
13
2

0n
0
8
1

4
5
1

1
9
n

0

0

0

0

2
2
4
0
0

3
6
8
3
0

0
1
6
2
0

3
5
2
1
0

n

0
3
5
0
0

1
4
13
2
0

0
H
1
0

4
5
1

1
5
n

2
0

0

REVIEWING CREDIT LINES OR LOANq
ESTABLISHED CUSTOMERS
MUCH FIRrER POLICY
MODERATELY FIRMFR POLICY
ESSENTIALLY (INCHANGFO POLICY
MODERATELY EASIFR POLICY

12"
1
1
9A
11

MUCH FASIER POLICY
NEW CUSTOMERS

0

0

0

0

2
8
2

0
9
1

2
11
2

0

0

0

0

0
2
7
2
0

0
5
5
2
0

0
4
5
1
0

1
2
9
3
0

2
0
7
0
0

0
0
10
1
0

0
1
9
2

0
1
A
1

0
2
12
1
0

0
2
6
1

1
8
0

0

0

0
0
9
4

121

MUCH FIRMER POLICY
MODERATELY FIRMFR POLICY
ESSENTIALLY UNCHANGED POLICY
MODERATELY EASIFR POLICY
MUCH EASIER POLICY
LOCAL SERVICE AREA

0
0
10
1

CUSTOMeRS

MUCH FIRMER POLICY
MODERATELY FIRMER POLICY
ESSENTIALLY UNCHANGED POLICY
MODERATELY EASIFR POLICY
MUCH EASIER POLICY

Q
3'
6
21

?
1
1
0

121

I'
9q
14

NOT FOR QUOTATION OR PUBLICATION

TARLF 3

ALI
DSTS

NFW YORK
HOSTON
TOTAL CITY OUTSIDE

(CONTINUED)

PHTLADEL.

CLEVE- RICHLAND
MOND

ST.
ATLAN- CHICTA
AGO
LOUIS

MINNE- KANS.
CITY
APOLIS

DALLAS

SAN
FRAN

LENDING TO NONFINANCIAL
BUSINESSES
RFVIEWING CREDIT LINFS OR

LOAN;

NONLOCAL SEWVICF AREA COST

12,

MUCH FIRMER POLICY
MODERATELY FIHMER POLICY
FSSENTIALLY UNCHANGFI POLICY
MOOFRATELY EASIFR POLICY
MUCH EASIER POLICY

1"
'

7.
1

1
2
5
0
0

3
5
10
2
0

1
1
6
0
0

3
lb
n
0

n
1
7
1
0

3
4
3
1

"
1
8
n

?

n

9
4
n

u

0
2
8
1
0

2
1
7
2
0

0
5
5
0
0

1
4
h
2
0

2
0
7
0
0

0
1
2
0
0

1
1
6
1
0

0
1
7
1
0

0
1
9
3
0

0
1
9
1
0

1
3
8
0
0

1
3
6
0
0

1
3
10
1
0

2
1
6
0
0

0
1
2
0
0

1
1
7
0
0

0
2
7
0
0

1
3
8
1
0

0
1
9
1
0

0
3

1
p?
7
n
0

1

0
0
3
0
0

0
1
7
1
0

0
1

11
1
0

1
1
7
0
0

0
0

0
1
10
2
0

0
1
7
n
0

1
0
11
3
0

1
1
b
2
0

0
1
2
0
0

0
1
6
2
0

0
1
6
2
0

0
1
9
3
0

FACTORS RELATING TO APPIICA'T ?/
VALUE AS DEPOSITOR OR SOUurt
OF COLLATFkAL HUSTNFSR

1-

MUCH FIRMER POLICY
MODERATFIY HIRMFR POLICY
FSSENTIALLY IINCHANGFd
POLIrY
MOUEOATtLY F'SIFR PO ICY
MUCH EASIER POLICY
INrENnED USF OF LOAN

1'
2/
9'

n

2
7
P

0

A
n
0

1"
<
I
ah

MUCH FIRMER POLICY
MODERATELY FIMMFR POLICY
ESSENTIALLY UNCHANGEI Po ICY
MODERATELY EASIFR POLICY
MUCH EASIbP POLICY

0
22
6
0
0

1

0

15

7
?
0

0

1
/
H
0
0

n
1
r
n

1

0

A

8
1
0

P

LENDING TO "NONCAPTIVF"
FINANCE CO'4PANIFS
TFPMS

ANO CONDiTInNS

IfJTERHFT

HATES CHAUGFnO

MUCH FIkMRC
POLTCY
MOURATETY F-IRMFP PnOLICY
FSSENTIALI Y 'JNCHANGFI) POLICY
MODERATELY FAIFR POLICY
MLICH EASIER POLICY

1

1
1?
4,
!

0
7
0
0

1
3
14
2
0

1

0
0

17
6
2
0

2/ FOR THESE FACTORS.
FTRMER MFA.S THE FACTOPS WERF CONSIDERFn MORF
CREDIT PFOUESTS. AND EASIER MFANS THEY WERF LESS IMPORTANT.

n
0

0
2
8
1
0

IMPORTANT IN

0
3

8
1
0

MAKING DFCISIONS FOR APPROVING

NOT

FOR QUOTATION

OR

PUBLICATION

TABLE 3

ALI
nSTS
LENnIN,
FINANC
TEkMq
ST7F

HOSTON

NFW YOHK
TOTAL CITY OUTSInE

(CONTINUED)

PHTLADEL.

CLFVE- RICHLAND
MOND

ATLAN- CHICTA
AGO

ST.
LOUIS

MINNE- KANS.
APOLIS
CITY

DALLAS

SAN
FRAN

Tn "I(IOCAPTTVF"
COMPANIFS
ANtD

CONITIUNqI

0E r(O 4oMPFATTNCI

RALAICF

POLT(Y
FITMFR r TCY
FSSt NTTALLY IINCHANGFIJ POLICY
MOi)F1ATI Y FAkEAIF
POLICY
'UC#
EAcIFR POLTCY

1?l

4IMUC FTtM-F.R

0
0
8
0
0

0
2
17
1
0

0
n
9
0
0

0
2
8
1
0

n
1
;

0
2
6
0
0

0
5
15
0
0

0
0
1
0
0

1
1
b
0
0

2
4
11
3
0

1
1
6
0
0

I
?

0
0

10
1A
1

0
0

MOI)FRAT'YF

ENFOH('CFINT OF
BAL ANCF PFt'lIRPFMFr T

F*
JI

n

114

0

0
1
9
1
0

0
0
12
0
0

0
2
A
0
0

1
0
14
0
0

1
0
8
0
0

0
0
3
0
0

0
1
R
0
0

0
1
8
0
0

0
0
13
0
0

0
5
6
0
0

1
n
N
A
n

0
1
9
1
0

1
0
11
0
0

1
4
5
0
0

1
0
14
0
0

1
0
8
0
0

0
0
3
0
0

0
2
7
0
0

0
1
A
0
0

0
2
10
1
0

1
6
2
0

2
3
5
1
0

1
n
4
1

1
1
8
1
0

0
2
10
0
0

1
2
7
0
0

1
1
11
2
0

1
1
7
0
0

0
0
3
0
0

1
1
6
1
0

0
2
6
1
0

1
0
9
3
0

0
2
14
4
0

0
0
7
2
0

0
.2
7
2
0

0
A
n
0

0
0
9
2
0

0
2
9
1
0

0
1
8
1
0

0
1
12
2

1
1
7
0
0

0
1
2
0
0

0
3
4
2
0

0
0
7
2
0

0
0
8
5
0

0
1
15i
3
0

0
0
8
0
0

0
1
7
3
0

n
n
6
n
0

0
0
10
1
0

0
0
12
0
0

0
0
7
3
0

0
0
14
1
0

0
1
7
1
0

0
0
3
0
0

0
0
8
1
0

0
0
8
1
0

0
0
7
5
1

I

MUCH FIrFP
POLTCY
MOUFRATkLY FIMFH POLICY
ESSIb
TTALI Y (UNCHANGFD POI IrY
MOOIwATtl Y tASIFW POLICY
MUC,
FASIFU PLICY
ESTAH ISuI1
CREDIT LINFS

*

1'
1l'1
-

'

I AkrEu

MULN FIRMIF
POLICY
MO(OIfATIY FIRMFR POLICY
Er
NTIALI Y JINCHANGFU) POLICY
MODEPATELY FASIFR POLICY
MUCH EPSIFR POLICY

I"
1'
1
H1,

TO MAHE ITHHR
WILLTNGNFS
TYPFS OF LOANS
TERM LOANS TO RUSINFSSES
COhSIDFRABLY LESS WILLIMODERATELY LESS WILLING
ESSENTIALLY IJNCHANGEO
MOUERATELY MORE WILLING
CONSIDERABLY MOPE WILLING
CONSUMER

INSTALMENT LOANS

CONSIDFRABLY LESS WILLING
MODERATELY LERS WILLING
ESSENTIALLY UNCHANGED
MODERATELY MORE WILLING
CONSIDERABLY MORE WILLING

12"
,'
Ii
n'
lu
.1
I13

NOT FOR QUOTATION OR PUBLICATION

TA8LE 3 (I0

805-

ALI
DST

Tc

NFW YORK
TOTAL CITY OUTSUnE

TINIIED)

PHILADEL.

CLEVE- RICHLAND
MONi

ATLAN- CHICST.
LUI;
TA
AGO

MINNE- KANS.
CITY
APOIS

DALLAS

SAN
FRAN

WILLINGNESS TO MAKE OTHER
TYPES OF LOnANS
SINGLE

AMILY MORTGAF LOANS

CONSTnFREARLY LESS wILLING
MODERATELY LESS WILLING
ESSEATrALLY UNCHANGED
MODEPATELY MORE WILLINh
CONSIDFkAHLY MORE WILLING
MULTIFAMILY MORTGAGE

OANS

CONSIFRAHLY LESS WILLING
MOUF4ATLLY LFSS WILLING
-SSE,)TIALLY I)NCHANGFI
MOUERATFLY MORE WILLING
CONSIDFRAA
Y MORE WILLI4N
ALL OTHER MORTGAGF LOANS
CONSTOERARLY LESS WILLING
MOUVRATELY LESS WILLING
ESSENTIALLY IINCHANGED
MODERATELY MOHRE WILLING
(ONSIDFHAHLY MOPE WILLING
PARTICIPATION LOANS WITH
COPHLSPONDENT RANKS
CONSIFRARLY LESS WIILI',
MODERATELY LESS WILLING
FSENTT4aLLY JNCwANrFl
MODEPATELY MORE WILLING
CONSIDHARILY MOPE WILLING
LOANS

TO HROKLRN

CONSIDFAHALY LESS 4ILL11'
MOI)DERATLY IFhh WILLING
FSSINTIALLY JNCHANGFD
MODERATELY MOHF WILLING
CONSInFAHLY MORE wTLING

NIINRFA

OF

lANKS

122
1
1

0
0

41

8

1%

0

2
3
9
4

0

0

0

0

0
0
8
0
0

1
4

0

0
1
5
1
0

1

0

4

1
7

3

2
0

I

2
0

1
4
12
3
0

A
1

1

1

1
5
1

4
3

n
4
n

a
2

2

0
4
9
2

1
7
J

0
2
1
0

2
0
7
0

1
0
6
2

0
1
11
1

0

0

0

0

0

0

0

?

c

6
1

12

4

2
1
6

1
a

a
a

U
2
1

01)

0

n

1

0

a

A
a

0

n

0

1

0

0

0

0

1

0
4

0
2

9

1
1
7

1
0

7

0
0
3
0
0

8

0

0
0

0
0
11
2
0

14

1
7

0
0
3

0
0
7

0
0
A

I

1

0

p

1

1)

0

0

0

0
0
9
4
0

0

0

1

0

0

II

1

0

8

0

11
2

0

0

1

1
2
H
1

0

0

1

I
3

8

1
1

121
14
1'
A(
7
6

'

1
3
4
2
0

n
4

1

1
11

1

123
7

17
91

0
1
7
0
0

12

0

n

4
1

0

1
1
7
1
0

9

n

0

0

0
0

0

0

(

12
1
11
9go

1'

0
1
7
0

0

8
1

1
4
4
2
0

0
2

1

1
1ll
1

2
A

0

0

0

0

n
r

0

2

1

0

2
a

1
9

1
7

2
12

7

3

1
7

0

1

0

n

I

0

0

0

0

0

0

0

1P
N

I
1O>
'

121

0
1
7
0
0

2
17

9
0

1
2

9
0

0

A

1

0

0

0

B-1
SUPPLEMENTAL APPENDIX B*
MONTHLY SURVEY OF BANK LOAN COMMITMENTS
As reported by 134 banks in the Monthly Survey of Bank Loan Commitments, unused commitments during October grew at a fairly rapid pace comThe growth may in part be reflective of the
pared to oher recent months.
very slow rate of takedowns in October when the spreads between the commercial paper rates and the prime rate made the commercial paper market attrac-ive to borrowers.
Bank customers apparently let their commitments go unused,
as outstanding loans under commitments declined slightly over the month. In
addition, new commitments advanced briskly compared to the previous month,
but the volatility of the series makes interpretation of one-month movements
risky.
The October data in greater detail, in Table 1, columns 1 and 2,
show that unused commitments of commercial and industrial firms grew rather
rapidly, which was largely accounted for by a jump in confirmed lines of
credit. The unused commitments of nonbank financial institutions also showed
rapid growth, even though these institutions drew substantially on their
Unused commitments for real estate mortgages,
commitments (columns 4 and 5).
following the trend of recent months, declined even though new commitments
for real estate mortgages increased well above September's level--possibly
in anticipation of the large expenditures on plant widely predicted for next
year. The reported increase in outstanding mortgages under commitments was
modest, but the actual increase was somewhat larger due to loan sales.
Table 2 permits a comparison of the most recent figures on unused
commitments with such data since the inception of the survey. 1/ Data on unused commitments for July through October 1973, from the 131 banks that reported in all of those months, are presented. Survey information on new
commitments and loans under commitments, however, are not shown due to reporting problems in the early months of the survey with those series.
Over the entire July-October period, unused C & I commitments
increased very little (column 1) while unused commitments for real estate
In contrast, nonbank financial institutions,
mortgages declined (column 8).
reacting to disintermediation earlier
perhaps due to thrift institutions
this year, built up their commitments from commercial banks appreciably
(column 7).
1/ Although the first month of the survey was June, those data were
excluded because many banks were unable to provide complete information.

- B-2
Interpretation of the commitments data may be aided by analysis of

the utilization ratio, defined as the ratio of outstanding loans made under
commitments to unused commitments plus outstanding loans under commitments.
The ratio is often used by bankers to interpret their position regarding
commitments. With growth in unused commitments strong over the month of
October, the utilization ratio for all commitments declined, led by the drop
in the C & I ratio, as shown in Table 3. Only the utilization ratio for real
estate mortgages rose in October in response to the decline of unused mortgage commitments.

*

Prepared by Paul W. Boltz, Economist, Banking Section, Division of
Research and Statistics.

Table 1
Monthly Changes in Loan Commitments and Loans
Under Commitments at Large U.S. Banks
September 30, 1973, to October 31, 1973
(Dollar amounts in billions)
Unused commitments--

New commitments

One-month changes

(1)
Amount

(2)
Per cent

1/

Loans under commitments-One-month changes 2/

(4)

(3)
Amount

(5)

Amount

Per cent

Total commercial and industrial
Term loans
Revolving credits
Total: term and revolving
Confirmed lines
Other

2.89
.12
.18
.30
2.37
.22

3.6
2.3
1.0
1.9
4.6
5.1

4.44
.75
1.03
1.78
1.72
.89

-1.17
-. 14
.21
.07
-1.28
.05

-1.7
-0.7
1.1
0.2
-4.9
0.8

Nonbank financial institutions

1.16

4.5

.92

.41

2.8

Real estate mortgages

-.41

-4.5

1.07

.20e

1.1

Total

3.64

3.2

6.42

-1.06

-1.0

Number of banks = 134

It no
New commitments is a different concept from that used in the Quarterly Survey of Bank Loan Commitments.
longer includes renewals and cannot account for the total change in unused commitments.
2/ Loans under commitments are those loans made under commitments currently or previously in force, less repayments
principal. The change in loans under commitments is thus the net increase in outstanding loans made under commitments over the period September 30, 1973, to October 31, 1973. It is a proxy for takedowns minus repayments. The
stock of loans under commitments and its increment over the period are distorted by takedowns of loan commitments
by overseas branches of U.S. banks and loan sales.
e-- Partially estimated.
NOTE: Minor inconsistencies may occur in the figures due to rounding.
1/

Table 2
Unused Commitments at Large U.S. Banks
July 1973 to October 1973
(Dollar amounts in billions)

Total
Ck T

C& I

C & I
term

revolving

1 nn

C&I
term and
revolving

redi t

redA

t

C & I
confirmed

Nonbank
financial

C & I
c&I

nthsr

lines

inatitu

on

Real
estate
mrt

Ca

o

Total
unused
commiternts

amt.

7
chg.

amt.

%
chg.

amt.

%
chg.

amt.

%
chg.

ame.

%
chg.

amt.

7
chg.

amt.

%
chg.

amt.

%
chg.

amt.

7
chg.

July 31

77.8

--

5.3

--

18.1

--

24.1

--

50.5

--

3.2

--

23.5

--

9.3

--

110.6

--

August 31

78.0

0.2

5.7

-0.6

18.6

2.9

23.8 -1.2

51.2

1.4

3.0

-8.0

24.7

5.1

9.4

0.9

112.1

1.4

September 30

77.1

-1.2

5.0

-3.8

17.9 -3.5

23.0 -3.6

51.2

0.1

2.8

-3.7

24.9

0.8

8.9

-4.8

110.9

-1.1

October 31

79.9

3.7

5.2

2.8

18.1

1.0

23.3

53.5

4.5

3.0

6.6

26.1

4.5

8.5

-4.5

114.5

3.2

2.1

2.7

-0.1

-1.9

--

-0.8 -3.3

3.0

5.9

-0,2

-6.3

2.6

11.1

-0.8

-8.6

3.9

3.5

July 1973 - Oct. 1973
change

--

Fumber of banks = 134

NOTE:

Minor inconsistencies

may occur in the figures due to rounding.

1.4

Table 3
Loan Commitments at Large U.S. Banks
(Dollar amounts in billions)

As of October 31, 1973

Unused
Commitments

Per Cent
Distribution

Loans
under 1/
Commitments

Per Cent
Distribution

Memo: Sept. 30
Utilization , Utilization 2/
ratio (%)ratio (%)
,

82.0
5.9
18.3
23.7
53.9
4.5

69.8
4.6
15.6
20.2
45.9
3.8

68.2
18.3
18.8
37.1
24.8
6.3

65.8
17.7
18.1
35.8
23.9
6.1

45.4
77.2
50.7
61.0
31.5
58.3

46.7
77.7
50.7
61.4
33.6
59.4

Nonbank financial institutions 26.7

22.7

18.1

17.5

40.4

41.0

17.7e

16.6

66.8

65.6

100.0

46.9

47.9

Total C & I commitments
Term loans
Revolving credits
Total:
term and revolving
Confirmed lines
Other commitments

Real estate mortgages
Total

8.8

7.5

117.5

100.0

104.1

Number of banks = 134

1/ Loans under commitments are those loans made under commitments currently or previously in force, less repayments
of principal.
2/ The utilization
ratio is the ratio expressed as a percentage of loans under commitments to the sum of unused
commitments and loans under commitments.
e -partially estinated.
NOTE: Minor inconsistencies may occur in the figures due to rounding

C-

APPENDIX C:

1

DEMAND DEPOSIT OWNERSHIP SURVEY*
October, 1973

Demand deposit ownership data for weekly reporting banks
indicate a slightly larger increase in gross IPC deposits (not
seasonally adjusted) at these institutions in October than in the same
The October strength
(See Table 1.)
month of previous survey years.
in IPC demand deposits followed relatively weak growth in September,
which is consistent with the pattern of M1 expansion over the SeptemberOctober period.
The largest proportion of the increase in total IPC balances
at large banks in October occurred in deposits of nonfinancial
businesses; but when compared to previous years, this growth appeard
to be mostly seasonal. However, the $500 million increase in deposits
held by financial businesses was considerably larger than the average
October rise in the 3 previous survey years. The unusual pickup in
financial institution deposits in October may have reflected in part an increa
in balances of thrift institutions which during this period still faced
considerable uncertainty about the future direction of thrift deposit
flows.
Consumer and foreign held IPC deposits at weekly reporting
banks--which in previous October surveys have not grown at all-increased by very small amounts in the most recent survey month.

*Prepared by Martha Scanlon, Economist, Banking Section, Division

of Research and Statistics.

C-

2

Table 1
CHANGES IN THE LEVELS OF GROSS IPC DEMAND DEPOSITS
BY OWNERSHIP CATEGORY, WEEKLY REPORTING BANKS
(Billions of dollars, not seasonally adjusted)
Month/
Year
Jan.
Feb.
March
April
May
June
July
August
Sept.
October
Nov.
Dec.

Jan.
Feb.
March
April
May
June
July
August
Sept.
October
Nov.
Dec.

FINANCIAL BUSINESS
1970 1971 1972 1973

.1
-.9
.7
-.2
.4
-.1

.4
0
.3
0
-.4
.3
.1
-.8
.5
.1
-.1
.7

0
.7
.3
.3
-.6
.4
.3
-.7
.1
.4
.4
.2

1970

FOREIGN
1971 1972

0
-.2
0
0
-.1
0

0
0
0
0
0
0
0
-.1
0
0
0
.1

-.1
0
.1
0
.1
0
0
0
0
0
0
0

.3
-.7
.1
0
-.5
.4
.6
-.5
.2
.5

1973
0
.2
0
.2
.1
0
.1
0
0
.1

NONFINANCIAL BUSINESS
1970 1971 1972 1973

-.1
0
1.0
-.1
.2
2.2

-1.7
-2.2
.2
.9
- .5
1.3
.5
-1.3
1.2
.9
.3
2.8

1970

ALL OTHER
1971 1972

0
-.5
.6
.3
-.4
.1

0
0
.2
0
-.2
.5
-.6
-.4
.5
-.1
.1
.5

-1.8
-1.4
.5
1.0
- .8
1.1
1.3
-1.1
1.5
1.0
.5
3.9

0
0
.1
-.1
-.2
.3
0
-.2
.4
0
.1
.4

-1.3
-2.8
-1.2
.3
- .2
1.6
.3
-1.6
.9
1.0

1973
.2
-.2
-.2
0
0
-.1
.3
-.4
.4
.1

1970

.3
0
.6
-.3
.2
2.2

1970

.3
-1.5
2.9
- .3
.3
4.5

CONSUMER
1971 1972
.4
-.6
.8
1.4
-1.2
.4
.4
-,5
.3
0
.1
0

.7
-1.0
.6
2.0
-1.6
.4
.4
-.2
.3
0
.4
.5

TOTAL
1971 1972
-1.0
-2.8
1.6
2.4
-2.4
2.5
.4
-3.0
2.4
.8
.3
4.1

-1.2
-3.1
1.6
3.2
-3.2
2.2
2.0
-2.2
2.3
1.4
1.4
5.1

1973
.6
-1.5
.2
2.1
-1.7
.2
.2
0
.1
.1

1973
-.2
-5.1
-1.1
2.6
-2.4
2.1
1.5
-2.6
1.7
1.7