Full text of H.16 Capital Market Developments : April 23, 1973
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DECONTROLLED AFTER SIX MONTHS WOOuial L . 5 ^ Confidential ( F . R . ) A p r i l 23, 1973 CAPITAL MARKET DEVELOPMENTS Capita! Markets Section, Division of Research and Statistics, Board of Governors of the Federal Reserve System, WashingtolllllMl 1 ^ INDEX Developments in the Corporate and Municipal Bond Markets Capital Market Y i e l d s Capital Market Volume Stock Market Mortgage Market SYMBOLS: e Estimate p Preliminary r Revised n o. Not available TABLE 1: Yields, Volume and Reception WEEK ENDING: 1973 - Mar. 2 9 16 23 30 Apr. 6 13 20 27 WEEK ENDING: 1 YIELDS MOODY'S SEASONED NEW ISSUE1 Aaa -- 7.52 7.45 7.25 7.27 7.29 7.31 -- -- 7.51 7.27 7.25 7.25 n.a. — —— n.a. 139 83 70 500e YIELDS BOND BUYER MOODY'S NEW ISSUE SEASONED 20 Aaa BOND INDEX 1973 - Mar. 2 9 16 23 30 5.00 5.05 5.10 5.10 5.10 5.22 5.27 5.34 5.35 5.26 Apr. 6 13 20 27 5.05 4.85 4.90 n.a. 5.22 5.07 5.17 n. a. CORPORATE BOND MARKET VOLUME; 2 PER CENT I GROSS SOLD BY END BONDS SCHEDULED OFFERINGS OF WEEK 1 WITHIN 28 DAYS 20 n.a. 100 234 88 n.a. 270 84 465 100 110 94 ' 90 100 100 n.a. n.a. n.a. n.a. n.a. MUNICIPAL BOND MARKET VOLUME-2 GROSS OFFERINGS PER CENT SOLD BY END OF WEEK 366 483 631 703 399 77 78 82 81 94 304 657 286 235e 90 93 n.a. n.a. BONDS SCHEDULED WITHIN 28 DAYS 1,552 1,419 1,344 1,043 818 701 519 433_ New series derived by adjusting to a Aaa utility basis, new issues of publicly-offered corporate bonds with call protection, rated A, Aa, or Aaa by Moody's Investors Service (except serial and convertible issues, offerings of natural gas pipeline and foreign companies, and bonds guaranteed by the Federal Government). 2 Millions of dollars unless otherwise indicated. Note: Sec footnotes to Table 3 \ T A B L E 2: Details on Inventories DATE OFFERED CORPORATE BONDS IN SYNDICATE END OF LATEST WFRK [ORIGINAL 1 RATING AND ISSUER COUPON | YIELD |CALL PROTECTION AMOUNT 1 (MIL. $) I ESTIMATED PRO1 PORTION SOLD NONE OFFERED DATE | RELENSlT CORPORATE BONDS RELEASED FROM SYNDICATE DURING LATEST WEEK ORIGINAL INCREASE RATING AND ESTIMATED PROISSUER YIELD IN YIELD CALL PROT. PORTION RELEASED AMOUNT NONE INVENTORIES ' DATE 1973- ~Mar~. T~3 30 April MUNICIPALS BLUE LIST 670 587 IN SYNDICATE 554 618r 705 •55 56 105 168 63 CQRPORATES IN SYNDICATE 12 6 4 0 0 - No call protection. All figures in millions of dollars Blue Lis •hich i, U.nily average of three day. ,nd,d / • of Friday. f " U t "< T A B L E 3: High Grade Bond Yields U.S. GOVERNMENT 20-YEAR CONSTANT MATURITIES 3 BOND BUYER'S SEASONED MUNICIPALS4 7.71 (8/12) 7.06 (2/12) 6.51 (6/18) 5.69 (3/23) 6.23 (6/23) 4.97 (10/21) 7.60 (4/21) 6.99 (11/24) 7.36 (4/28) 7.05 (12/8) 6.19 (4/14) 5.74 (11/17) 5.54 (4/13) 4.96 (10/21) 7.52 (3/16) 7.29 (1/21) 7.31 (3/30) 7.11 (1/5) 6.93 (3/16) 6.42 (1/5) 5.35 (3/22) 5.03 (1/12) 23 30 7,45 7.31 7.31 6.92 6.88 5.35 5.26 6 13 20 7.51 7.27 7.25 7.25 6.87 6.84 6.84 5.22 5.07 5.17 DATE NEW CORPORATE Aaa 1 1971 - High Low 8.26 (7/30) 7.02 (2/5) 1972 - High Low 1973 - High Low 1973 - Mar. Apr. 1 -- -- MOODY'S SEASONED CORPORATE Aaa 2 New issue, Aaa utility, with call protection, adjusted (as described in footnote 1 of Table 1) to a Aaa basis. 2 Weekly average of daily figures. Average term of bonds included is 22-24 years. 3 Weekly average of daily figures. 4 Thursday figures. The average rating of the 20 bonds used in this index" ! falls midway between the four top groups as classified by Moody's Investors Service. Note--Highs and lows are for individual series and may be on different dates for different series. 6 T A B L E 4: Long-term Corporate and State and Local Government Security Offerings and Placements Un millions of dollars) GROSS PROCEEDS PERIOD 1 1 ! CORPORATE i 1973 STATE AND LOCAL 2 1972 1971 1973 1972 1971 3,205 3,369 3,229 3,115 3,000 6,075 1 ,902 1,445 2 ,270 1,776 2,005 2,239 2,732 1,851 2,258 April May June 3,275 3,598 4,341 4,042 3,300 4,375 1,989 2,017 2,270 1,891 2,167 2,013 July August September 3,582 2,893 2,720 4,147 2,532 3,768 1,805 1,966 1,726 1,989 1,903 2,098 •October November December 3,791 3,377 3,396 3,387 3,704 3,673 2,200 1,861 1,794 1,728 2,264 2,068 9,803 11,214 9,195 10,564 12,190 11,688 10,447 10,764 6,020 6,276 5,494 5,855 6,841 6,081 5,990 6,060 21,017 30,212 40,776 23,844 34,325 45,089 12,296 17,790 23,645 12,812 18,902 24,962 2,235 2,175e 4,050e January February March 1st 2nd 3rd 4th Quarter Quarter Quarter Quarter 1st half Three quarters Year 8,460e j 5,617 ! ! Securities and Exchange Commission estimates of gross proceeds. Investment Bankers Association of America estimates of principal amounts. ' : : 1 . ; j 1 TABLE 5: New Corporate Security Issues, Type of Issue and Issuer (In millions of dollars) QUARTER OR MONTH TOTAL 1972 - II III IV 11,214 9,195 10,564 GROSS PROCEEDS BY TYPE OF ISSUE COMMON AND BONDS MEMO: PUBLICLY 1 PRIVATELY PFD. ISSUES INCLUDED MFG. STOCK FOREIGN 1 CONVERTIBLE OFFERED j PLACED 4,634 2,781 3,798 245 449 2.,109 4,192 1,867 3,136 836 57 1,,629 3,147 3,258 4,158 245 428 1.,398 GROSS PROCEEDS BY TYPE OF ISSUER COMMUNICATIONS OTHER ISSUERS1 3.,495 2,,680 2.,934 1,,369 856 1,,079 4,240 4,030 5,151 PUBLIC UTILITY 1973 - I 8,460 2,714 2,845 2,900 n.a. 94 623 2;,656 1:,116 4,023 1972 - Jan. Feb. Mar. 3,205 3,369 3,229 1,767 1,907 1,677 604 412 577 834 1,041 976 59 12 3 195 83 233 392 529 604 533 988 740 752 498 227 1,529 1,354 l,b58 Apr. May June 3,275 3,598 4,341 1,622 1,676 1,336 789 744 1,218 864 1,148 1,786 15 100 130 92 226 131 581 761 767 l,219 738 l,538 178 391 800 1,297 1,708 1,235 July Aug. Sept. 3,582 2,893 2,720 1,807 1,523 863 657 • 1,118 421 948 789 1,070 3 17 37 450 183 203 574 452 603 798 635 l,247 586 237 33 1,624 1,568 838 3,791 3,377 3,396 1,773 1,361 1,024 564 982 1,601 1,454 1,034 770 28 124 93 162 171 95 383 426 589 l,280 794 860 371 658 50 1,757 1,499 1,895 989 625 1,100 195 700 1,950 1,050 850 1,000 14 n.a. n.a. 79 10 5 138 250 235 89.6 850 950 31 100 985 1,168 975 1,880 Oct. Nov. , Dec. 1973 - Jan. , 2,235 Feb.S. 2,175 Mar.e,' 4,050 1 Other issuers are extractive, railroad and other transportation, real estate and finance, and commercial and other, Source: Securities and Exchange Commission. Quarterly supplements are available. T A B L E 6: Large Long-term Public Security Issues for New Capital (Other than U.S. Treasury) 1 April 1 through April 20 , 1973 ISSUER Con. Light & Power Continental Bank Commercial Credit Co. Louisville Gas & Elec. Cabot, Cabot & Forbes Land Tr. Union Commerce Corp NJB Prine Investors Metropolitan Edison Citizens Mortgage Trust Ryder System Inc. Philadelphia Electric Cousins Mortgage & Equity Inc. TYPE 2 1st mtge Notes Notes Pref stk Bonds Bonds Bonds Pref stk Bonds Bonds Com stk Bene. Int. AMOUNT (MILLIONS OF DOLLARS) 50.0 25.0 50.0 21.9 25.0 20.0 25.0 25.4 20.0 50.0 46.6 34.1 MATURITY 2003 1983 1993 —— 1981 1998 1980 -- 1990 1993 -- COUPON RATI- OR NET INTEREST COST OFFERING YIELD MOODY': RATING 7.63" 7.50 7.75 7.45 8.50 .7 7/8 7.00 8.12 8 1/2 7.80 7.58 7.61 7.80 7.30 8.50 7.95 7.00 8.00 8.55 7.825 AA -— -- A ---— -— —— Baa -- — — -- i T A B L E 6: Large Long-term Public Security Issues for New Capital (continued) (Other than U.S. Treasury) 1 I ISSUER Jacksonville Elec. Auth, Fla. TYPE 2 Rev. AMOUNT (MILLIONS OF DOLLARS) 45.0 68.0 G.O. Rfg. Rey. 24.3 22.9 G.O. 40.0 G.O, Swr-Rev. 10.8 Poll. Cont. Rev. 3.5 Lehigh Co. Ind. Dev. Auth Poll. Cont. Rev. 24.5 Wisconsin G.O. 6.5 Wisconsin G.O. 30.0 Memphis, Tenn. G.O. 25.0 " New Mexico G.O & Rev. 9.0 New Mexico G.O & Rev. 2.0 San Francisco Muni. RR. Imp. Corp.Rev. 10.8 New York City G.O. 224.8 New York, New York G.O. 60. 6 Md. Health & Higher Ed. Fac, Auth.Rev. 10.1 Md. Health & Higher Ed. Fac. Auth.Rev. 13.4 Mass. Port Auth Rev. 74.0 Mass Port Auth Rev. 33.0 Murray State Univ., Ky. Bldg. Ref 11.8 Connecticut, State of Tacoma, Washington Buffalo, New York Ohio, State of Orange Co., Fla. LLehigh Co. Ind. Dev. Auth MATURITY 1980-1990 2001 1974-1993 1982-2007 1974-1999 April 1 COUPON | RATE OR | <)ITI:RNET INTER- ! IXC EST COST | YIELD 5.29 4.87 5.49 4.99 4.88 5.52 1977-1983 2003 1974-2003 1974-1993 1973-1993 1975-1978 -- 1974-1994 1974-1987 1974-2013 1976-1987 2003 2012 1976-1998 1982-2000 6.25 5.03 4.66 4.72 4.21 4.22 4.83 5.Id -4r5.64 4.50-5.00 5.35 4.00-5.05 4.80-5.65 4.15-5.50 4.00-5.30 4.20 5.80 Aa 4.50-4.88 A 6.25 3.90-5.30 3.90-5.00 3.80-4.90 A Aa Aa Aa Aa Aa Aa A A ; A A A A Baa 4.00-4.15 4.00-5.00 4.25-5.30 4.25-6. 20 4.50-5.40 5. 70 4.60-5/50 __ 5.86 MOODY'S RATING 5.00-5.88 Aaa A-l A Aaa Baa-1 T A B L E 6: Large Long-term Public Security Issues for New Capital (continued) (Other than U.S. Treasury)' ISSUER TYPE 2 ... United Nations Dev Corp United Nations Dev Corp Georgia Education Auth Georgia Education Auth Sacramento Muni Ut. Dist, Cal. Sacramento Muni Ut. Dist. Cal. Los Angeles Co., Calif Flood Control Dist Los Angeles Co., Calif Flood Control Dist Seattle, Washington G. 0. G.O. G.O. Rev Elec rev Elec rev April 1 through April 20, 1973 COUPON I AMOUNT 1 1 CM1T, LIONS 1 : RATE OR . MOODY'S I MATURITY 1NET INTEROF • i;.c RAT IMG 1 EST COST 1 vi i:i.u L DOLLARS) 1 10.3 44.9 25.4 5.0 11.0 39.0 1977-1998 2023 1974-2013 1974-2013 1978-1992 2013 5.00 4.99 5.30 5.30 4,.65-5.75 5.90 3,,90-5.25 3,.90-5. 25 4,.25-5.00 5.34 A A Aa G.O. 10.0 1974-2003 4.89 3,.75-5.30 Aa G.O. G.O. 22.0 12.0 1975-1995 1975-2013 4.83 5.09 4,.00-5. 00 3,.90-5.,35 . Aa Aa 300.2 200.9 100.0 150.0 1978 1977 2003 1998 7.20 7.20 7.20 7.58 7.39 7.35 __ Aa Aa Other Farmers Home Admin Farmers Home Admin Province of Quebec T.V.A. Notes Notes Debs Pwr Bd __ lights offering. Includes corporate and other security offerings of $15 mi 11 ion State and local security offerings of $10 .million and over. In case of State and local government securities, (',.(). denotes • i I ..Mi '<e v. - lit . , revenue obligations secured on 1 v by income from pubi1c ui i1 it i. • s; Re v. -Q.-IIL . , revenue b Kids secured only by income from quasi -lit n i t i revenue bonds secured by revenue from specific taxes on 1v; Re bonds secured solely by lease payments. Includes foreign government and I nternat i cinal Bank for R e c o n s t r u c t i o n and Development issues and non-quiranteed issues by Federal Agencies. __ 11 T A B L E 7: Forthcoming Large Long-term Public Security Offerings for New Capital (Other than U.S. Treasury) 1 . ISSUER Corporate Bell Tel of Pa. Bell Tel of Pa. Alison Mtg Investment Trust Industrial National Co Washington Water Pwr Co Ford Motor Credit Co Ford Motor Credit Co Tucson Gas & Elect Tucson G & E San Diego G & E Wickes Corp GTE of Michigan Investors Realty Trust Mid-Continent Tele Corp Gulf Power > Instrument Systems Corp Toledo Edison Hartford Elect Co General Public Utilities Baltimore Gas & Electric Dayton Power & Light Public Service Colo. ^Mississippi Pwr ColumbuS & Southern Ohio E. *Columbia Gas Consolidated Edison Co of N.Y. Walter Kidde & Co Continental Illinois Corp Great American Mortgage Invest TYPE (continued) AMOUNT (MILLIONS OF DOLLARS) Bonds 50.0 Bonds 125.0 Bonds 25.0 20.0 Bonds Bonds 20.0 Debs 50.0 125.0 Notes Bonds 40.0 Pref stk 15.0 Pref stk 30.0 Deb 60.0 1st mtg 20.0 Bonds 15.0 Pref stk 18.0 Bonds 25.0 Bonds 25.0 Com stk 22.5 Bonds 40.0 Com stk (rts) 83.0 Com stk 45.0 25.0 Pref stk Bonds 50.0 15.0 Bonds 25.0 Com 50.0 Bonds Com stk 120.0 . 65.0 Debs Bonds 100.0 25.0 Bonds Ag 20, o f 1973 APPROXIMATE DATE OF OFFERING April April April April April April April April April April April April April April May - May May May May May May May May May May May INDEF INDEF INDEF 24 24 24 24 24 25 25 25 25 25 26 26 26 1 1 1 2 3 8 9 10 15 16 16 12' T A B L E 7: Forthcoming Large Long-term Public Security Offerings for New Capital (Other than U.S. Treasury) 1 (continued) . ISSUER State lndf Local *DeKalb Co., Ga Virginia Public Sch Auth *Houston, Texas Monroe Co., N.Y. Alaska State Hsg Auth ^Virginia Beach, Va. Lacygne, Kan. Los Angeles Reg Arpts Corp, Cal Prince George's Co., Md. Gulf Coast. Waste Disposal Auth, Tex. Pensacola, Fla California Pinellas Co., Fla ^Detroit, Mich. *New Jersey Turnpike Auth St. Paul, Minn. Philadelphia, Pa. San Jose USD, Cal. New Orleans, La. *Ohio Pub Fac Coram Los Angeles Cal. Dept of Wtr & Pwr TYPE Rev Rev Rev G.O. G.O. G.O. Rev AMOUNT (MILLIONS OF DOLLARS) APPROXIMATE DATE OF OFFERING 15.0 15.2 25.0 15.9 13.0 10.6 30.0 April April April April April April April 25.5 25.0 April April Rev Rev G.O. Rev G.O. Rev. G.O. G.O. G.O. G.O. Rev 25.0 12.5 25.0 13.0 17.5 210.0 10.9 53.2 13.0 18.0 40.0 April April May May May May May May May May May Rev. 47.0 * Rev Poll cont rev 1973 June 24 24 25 26 26 30 1 1 1 3 9 15 16 16 22 6 Included in table for first time. . Includes corporate and other issues of 515 million and over; State and local Government issues of S10 million and over. Includes foreign government and International Bank for Reconstruction and Development issues and non-guaranteed issues of Federal Agencies. 13 Table 8 STOCK PRICES AND VOLUME STOCK PRICES1' TRADING VOLUME * DATE 3 D J . INDUSTRIALS NYSE INDEX ' 1971 - High Low 57.76 (4/28) 48.73 (1/4) 1972 - High Low 1973 - High Low AMEX * 950.82 (4/28) 26.68 (4/28) 797.97 (11/23 )22.72 (1/4) AMEX NYSE 22.1 (2/12) 11.0 (9/17) 6.7 (2/5) 2.7 (8/13) 65.14 (12/11)1036.27(12/11) 28.53 (4/14) 889.30 (1/3) 25.61 (1/3) 56.23 (1/3) 21.8 (11/10) 11.2 (9/8) 7.4 (3/10) 2.6 (9/8) 65.48 (1/11) 1051.70 (1/11) 26,70 (1/8) 56.85 (3/26) 922.71 (3/23) 24.05 (4/5) 20.4 (1/12) 12.4 (4/6) 4.8 (1/12) ' 2.7 (3/16) 1973 - Mar. 2 9 16 23 30 60.17 61.02 60.75 58.15 59.58 961.32 972.23 963,05 922.71 95 K 0 1 24.68 24.88 24.71 24.17 24.41 17.2 16.0 14.2 15.5 15.6 4.0 2.9 2.7 3.1 2.8 Apr. 6 13 20 58.23 59 65 59.59 931.07 959.36 963.20 24.06 24.18 24.07 12.4 15.2 13.2 2.9 3.1 2.7 1. Figures other than highs and lows are Fridays only. Highs and lows are for the year and are not necessarily for Fridays. 2. NYSE is the New York Stock Exchange; AMEX is the American Stock Exchange. Volume figures are daily averaged for the entire week, (millions of shares). Trading is normally conducted for 5-1/2 hours per day and 5 days per week, or In recent years, however abbreviated trading to the extent, and over the time Hours/ Days/ From Through: Day • Week January 3, 1969. July 7, 1969 January 2, 1970 July 3, 1969 December 31, 1969 May 1, 1970 3. 12/31/65 - 50 4. Average dollar value of shares listed. 4 4-1/2 5 5 5 5 27-1/2 hours per week. periods, shown below: Hours/ Week 20 '22-1/2 25 . Hi TABLE 9: Security Credit END OF PERIOD Outstanding: 1972 - Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. CREDIT EXTENDED TO MARGIN CUSTOMERS BY TOTAL BROKERS1 j BANKS 2 Dec. 5 ,700 6 ,180 6,,620 7.,010 7,,200 7.,510 7,,600 7 ,780 : 7,,800 ,800 7: 7 3,890 7,,900 2,490 2,510 2,520 2,530 2,560 2,650 2,690 2,780 2,830 2,860 2,860 2,440 8;,190 8:,690 9:,140 9.,540 9.,760 10,,160 i o a ,350 10,,560 10,,630 10,,660 10,750 10,340 1973 - Jan. 7,,700 2,910 10,610 300 480 440 390 190 310 150 120 20 50 20 10 10 30 90 50 90 50 30 350 500 450 400 220 400 200 210 70 20 90 410 Nov. 'NET CREDIT 1 CUSTOMERS' ! CUSTOMERS' NET 1 EXTENDED BY 1 'BROKERS AND FREE CREDIT , NET DEBIT j| DEALERS 3 BALANCES ; | BALANCES i (4) j (4) (4) (4) (4) 2,488 2,542 2,512 2,459 2,300 2,231 2,245 2,117 2,056 2,097 2,218 2,317 -- 2,296 (4) (4) (4) (4) (4) (4) (4) Outstanding Changes : 1972 - Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. 1973 - Jan. 90 10 -200 -- " -420 470 270 | (4) (4) (4) (4) (4) (4) (4) (4) (4) (4) (4) (4) 268 54 -30 -53 -129 -99 14 -128 -61 41 121 99 21 Margin debt, as reported by the New York Stock Exchange. Although margin debt until March 1968 included loans secured by U.S. governments, the amount of such loans included is thought to have been small. "Bank loans to others than brokers and dealers for purchasing or c a r r y : ^ entities other than U.S. governments." The difference between customers' net debit balances and customers' net Lrw credit balances, this figure represents the net credit extended by brokers and dealers to the nonfinancial public. NOTE: With the exception of bank loan data, figures are supplied by the New York Stock Exchange and are end of month data. Bank loans are for weekly reporting large commercial banks. Broker data includes loans for regulated securities; bar^k data includes loans for the purpose of purchasing or carrying any security, vhethvi regulated or not. Series discontinued i i i i i i i T A B L E 10: Savings Flows at IMonbank Depositary Intermediaries ($ millions) DATE f MUTUAL SAVINGS BANKS SAVINGS & LOAN ASSOCIATIONS NET REGULAR DEPOSITS 3 NET SHARE CAPITAL NEW ANNUAL NEW ANNUAL 2 MONEY GROWTH NET NET MONEY2 GROWTH 1 1 FLOW FLOW RATE RATE 1969 1970 1971 1972 2,549 4,517 9,621 9,788 4.0 6.8 13,5 12.0 1972 - January February March 855 931 1,507 -- 1973 - January February^./ March£/ 766 551 1,070 h— 1972 - September October November December 925 780 761 902 12.6 10.5 10.2 12.0 1973 - JanuaryP/ February^/ March*-/ 808 465 550 10.6 6.1 7.0 1 2 3 -763 936 5,678 5,397 716 809 773 • 595 402 n a -— - --— Not Seasonally Ad justed 4,068 3.1 -1,003 10,965 8.1 5,285 28,230 19.3 20,653 32,902 23,884 19.5 3,266 2,318 4,287 TOTAL DEPOSITS ANNUAL NET GROWTH RATE 1 FLOW 6,617 15,482 37,851 42,690 3.4 7.7 17.5 17.0 __ 3,117 2,700 2,533 4,121 3,749 5,794 -3,278 3,105 — 1,650 3,200 Seasonally Adjusted 2,930 17.8 —— 2,706 16.2 —— 2,246 13.3 2,164 12.7 -- 4,044 2,201 4,270 __ 3,855 3,486 3,007 3*066 16.2 14.5 12.3 12.5 4,026 1,580 1,900 4,834 2,045 2,450 19.4 8.1 9.5 — 23.3 9.0 10.5 —— NET NEW MONEY 2 -1,766 6,231 26,331 29,281 - 3,833 3,509 3,306 -— 3,700 n•a • -— —* --- —— Annual growth rate for monthly data is the annualized monthly percentage increase in deposit?. Net New Money is new deposits net of both withdrawals and interest. Data for S&Ls are for insured associations only, which represent 967, of industry total resources. Regular deposits at mutual savings hanks exclude items such as Christmas club and ccrtain escrow accounts, which represent a very small part of total deposits. SOURCE: National Association of Mutual Savings Hanks and Federal llomv Loan Bank Board. TABLE 11: Mortgage Commitments at Selected Thrift Institutions TOTAL DATE OUTSTANDING COMMITMENTS 1 ' ALL MUTUAL • 1 TOTAL SAVINGS SAVINGS & BANKS LOAN (N.Y. STATE) ASSOCIATIONS NET CHANGE ALL SAVINGS & LOAN ASSOCIATIONS MUTUAL SAVINGS BANKS (N.Y. STATE) (Billions of Dollar $, Seasonally Adjusted)r/ Nov. Dec. 16.6 16.6 13.2 13.1 3.4 3.6 .20 .09 08 -.06 .12 .15 -Jan. Feb. March April May June July Aug. Sept. Oct. Nov. Dec. 17.2 18.5 19.6 20.5 21.6 21.3 22.7 22.3 23.4 23.2 23.5 23.3 13.4 - 14.4 15.3 16.0 17.0 16.8 17.1 17.8 18.7 18.5 18.8 18.6 3.8 4.1 4.3 4.5 4.6 4.5 4.6 4.5 4.7 4.7 4.7 4.7 .23 1.36 1.13 .89 1.04 -.26 .38 .71 1.06 -.36 .38 -.19 .12 1.01 .93 .69 .96 -.18 .30 .76 .89 -.25 .34 -.20 .11 .35 .20 .20 .08 -.08 .08 -.05 .17 -.11 .04 .01 > ! 4 Rased on data from Federal Home Loan Bank Board and Savings Banks Associations of New York State. Data for savings banks and S&L's include a minor amount of nonresidential commitments. S&L commitments include loans in process. Net changes are derived directly from unrounded outstandings levels as reported and after seasonal adjustment by Federal Reserve. Subtotals may not add to totals because of rounding. 17 TABLE 12: Net Change in Mortgage Holdings TOTAL y INCLUDING FNMA-GNMA 1969 1970 1971 1972 Jul; Aug Sepj: Oct Nov Dec FINANCIAL INSTITUTIONS MUTUAL SAVINGS &| LIFE LOAN INSURANCE SAVINGS TOTAL COMMERCIAL ASSOC. COMPANIES ~ BANKS BANKS l I Not Seasonally Adjusted 9,561 2,682 10,172 1,845 24,160 3,938 2,052 2,348 1,221 2,758 3,313 2,926 2,673 2,712 3,101 79 97 90 139 255 1,112 24,074 21,736 41,647 19,699 16,827 39,259 5,404 2,462 9,940 4,872 5,931 5,286 4,779 5,114 5,943 4,717 5,563 4,918 4,684 4,984 5,811 1,500 1,600 1,400 1,400 1,500 1,000 438 553 502 472 517 598 900 900 458 1973 - Jan Feb 1972 - Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec 1973 - Jan Feb 3,456 3,828 4,464 4,363 4,908 5,176 4,849 5,471 4,748 4,714 5,282 5,697 1 3,250 3,550 4,329 4,327 4,521 5,060 4,593 5,179 4,714 4,738 5,212 5,601 Seasonally Adjusted 1,112 290 1,178 315 1,264 464 1,361 400 1,434 453 1,489 516 1,451 472 1,477 515. 1,155 537 1,393 484 1,524 513 1,164 525 1,112 475 1,079 n.a. 162 1,871 2,075 2,596 2,481 2,567 2,959 2,678 3,108 2,911 2,726 2,876 3,130 n.a. n.a. -23 -18 5 85 67 96 101 79 111 135 299 782 219 Monthly data for commercial banks based on Federal Reserve estimates benchmarked to Call Report data on real estate loans outstanding as available. Other data derived from mortgage debt outstanding as reported separately by National Assn. of Mutual Savings Banks, Federal Home Loan Bank Board, Institute of Life Insurance and, through August 1968, the Federal National Mortgage Association, and thereafter by FNMA and the Government National Mortgage Association. Data for- mutual savings banks and for Life Insurance companies may differ somewhat from those derived from regular quarterly series because of minor conceptual differences for which adjustments are not made in the monthly series. Altogether, these groups accounted for 87 per cent of the net increase estimated for all holders in 1967. Beginning January 1972 data reflect activity in limited amount of conventional mortgages. 18 T A B L E 13: Net Increases in Mortgage Debt Outstanding .Billions of dollars, SAAR 1- to 4- MULTIFAMILY FAMILY MULTI-AND COMMERCIAL TOTAL RESIDENTIAL3 - I II III IV 27 .9 26.4 25.6 29.9 19.4 18.2 17.3 20.4 16.2 15.0 13.6 16.5 3.1 3.2 3.5 3.9 6.4 6.0 6.5 7.4 9.4 9.2 10.2 11.2 . 2.3 2.2 1.8 1.9 - I II III IV 31.7 29.1 25.7 25.6 23.8 21.5 18.7 18.5 19.4 16.8 14.0 13.1 4.4 4.6 4.7 5.4 6.0 5.4 5.3 5.3 10.4 10.1 10.0 10.7 2.2 2.2 1.7 1.4 - I II IIL IV 20.9 22.8 ?8 .3 32.2 14.4 16.8 21.3 22.8 9.4 11.6 15.0 16.2 5.0 5.2 ,4.8 4.6 9.8 9.9 1.5 1.5 6.6 6.8 13.4 2.2 - I - 11 III IV 37.7 47.4 52.3 54.9 27.3 36.0 38.9 40.7 19.2 26.5 30.1 31.9 8.0 9.4 8.8 8.9 8.1 9.5 11.1 11.0 16.0 19.0 19.9 19.9 ' 2.2 2.3 2.3 2.5 - I II III IV 61.8 64.1 64.3 67.2 45 .4 47.1 46.4 49.1 35.9 37.5 36.2 39.4 9.5 9.6 10.2 9.8 14.5 15.2 14.9 14.6 23.9 24.6 25.3 24.3 2.6 2.6 2.9 2.6 QUARTER COMMERCIAL FARM 1 Derived from data on mortgage debt outstanding from Federal Deposit Insurance Corporation, Federal Home Loan Bank Board, Institute of Life Insurance, National Association of Mutual Savings Banks, Departments of Commerce and Agriculture, Federal National Mortgage Association, Federal Housing Administration, Veterans Administration and Comptroller of the Currency. Separation of nonfarm mortgage debt by type of property, where not available, and interpolations and extrapolations, where required, estimated mainly by Federal Reserve. 2 May differ somewhat from related flow of funds series mainly because of m o r e aggregative type of seasonal adjustment. 3 Residential mortgage debt includes nonfarm only and is sum of 1-to 4- family and multifamily mortgage debt combined. 19 TABLE 14: FNMA BIWEEKLY AUCTION RESULTS (FHA/VA LOANS) TOTAL OFFERS (MILLIONS $) 1 YIELD TO FNMk (PER CENT) RECEIVED ACCEPTED 1972 - Oct. 16 30 271.2 186.4 224.9 162.7 7.73 7.74 Nov. 13 27 78.7 60.8 49.2 36.6 7.72 7.70 Dec. 11 26 82.2 108.7 42.4 66.3 7.68 7.69 1973 - Jan. 8 22 74.2 107.0 61.3 92.1 7.69 7.70 Feb. 5 19 128.7 110.3 65.4 71.6 7.71 7.73 Mar. 5 19 170.8 297.3 107.7 168.7 7.75 7.81 Apr. 2 16 234.6 216.6 145.9 190.7 7.86 7.89 Note: Average secondary market yields are gross—before deduction of 38 basis-point fee paid for mortgage servicing. They reflect the average accepted bid yield for home mortgages assuming a prepayment period of 12 years for 30-year loans, without special adjustment for FNMA. commitment fees and FNMA stock purchase and holding requirements . Data are for short-term (4 month) commitments. 20 TABLE 15: Private Housing Starts and Permits STARTS SEASONALLY ADJUSTED ANNUAL RATE TOTAL 1-FAMILY 2 OR MORE 1972 - January February March April May June July August September October November December 1973 - January February March l 2,439 2,540 2,313 2,204 2,318 2,315 2,244 2,424 2,426 2,446 2,395 2,369 2,497 2,457 2,259; 1,395 1,281 1,310 1,215 1,308 1,283 1,319 1,373 1,382 1,315 1,324 1,207 1,450 1,377 1,239 1.044 1,260 1,003 989 1,011 1,032 925 1,051 1.045 1,131 1,071 1,162 1,047 1,080 1,020 150.9 153.6 205.8 213.2 227.9 226.3 207.5 231.0 204.4 218.2 187.1 150.5 147.1 138.8 UNADJUSTED TYPE OF FINANCING FHA | VA I OTHER 36.1 27.8 37.7 29.1 32.4 31.9 26.2 30.3 28.2 25.4 21.3 42.3 7.5 8.0 10.5 8.5 9.4 9.6 9.4 9.9 8.9 8.5 8.0 5.8 12.0 6.8 — 6.8 BUILDING PERMITS (SEASONALLY ADJUSTED ANNUAL RATE) 2 107.3 117.8 155.7 172.9 186.1 184.8 171.9 190.8 167.3 184.3 157.8 102.4 2,204 2,056 2,007 1,991 1,955 2,121 2,108 2,237 2,265 2,216 2,139 2,377 126.3 2,218 2,191 2,093 Total starts are Census estimates including farm for both permit-issuing and non-issuing areas. A dwelling unit is started when excavation begins; all units in an apartment structure are considered started at that time. FHA and VA starts are units started under commitments by these agencies to insure or guarantee the mortgages. As reported by FHA and VA, a unit is started when a field office receives the first compliance inspection report, which is made before footings are poured in some cases but normally after the foundations have been completed. Other starts are derived as a residual, although total and FHA and VA starts are not strictly comparable in concept or timing; other starts include both units financed by conventional mortgages and units without mortgages. Building permits are Census estimates based on 13,000 or all known permitissuing places. Unlike starts, seasonally adjusted building permits reflect direct adjustment for differences in the number of days per month, as well as other differences in timing and coverage. 21 TABLE 16: Mortgage and Bond Yields DATE FHA MORTGAGES 2 30-year CONVENTIONAL MORTGAGES 3 SPREAD BETWEEN YIELDS ON CONV. & FHA MORTGAGES 5 1 NEW ISSUE Aaa UTILITY 4 SPREAD BETWEEN YIELDS ON NEW CORPORATE BONDS AND FHA MORTGAGES 6 - High Low 7.97 7.32 7.95 7.55 .28 -.19 8.26 7.02 - High Low 7.57 7.45 7.70 7.55 .14 .06 7.40 7.09 .61 . .05 - Jan. Feb. Mar. Apr. May 7.49 7.46 7.45 7.50 7.53 7.54 7.54 7.55 7.56 7.57 7.57 7.56 7.60 7.60 7.55 \ 7.60 7.60 7.60 7.65 7.65 7.70 7.70 7.70 7.70 .11 .14 .10 .10 .07 .06 .11 .10 .14 .13 .13 . 14 7.21 7.34 7.24 7.45 7.38 7.32 7.38 7.37 7.40 7.38 7.09 7.15 .28 .12 .21 .05 .15 .22 .16 .18 .16 .19 .61 .55 July Augus t September October November December .52 -.36 •32 7.38 .15 7.70 - Jan. 7.55 . 35 7.40 .19 7.75 7.56 Feb. .17 7.49 .17 Mar. 7.63 7.80 1 Neither mortgage nor bond yields include allowance for servicing costs which are much higher for mortgages than for bonds. Generally, bonds pay interest semiannually; mortgages, monthly. Mortgage yields, if computed as equivalent to a semi-annual interest" investment, would be slightly higher than given in the table. 2 Based on FHA-field-office opinions about average bid prices in the private secondary market for new-home mortgages for immediate delivery. Separate data available for 25-year and—beginning July 1961--30-year mortgages with minimum downpayments, weighted by probable volume of transactions. Yields computed by FHA, assuming prepayment period of 12 years for 25-year mortgages and 15 years for 30-year mortgages. 3 Based on FHA-field-office opinion on typical contract interest rates (rounded) on conventional first mortgages prevailing in the market areas of insuring offices. 4 See note for Table 1. 5 Yield spread equals conventional mortgage rate less FHA secondary market yield. 6 Yield spread equals FHA secondary market yield less new Aaa corporate bond yield. TABLE 17: Conventional Mortgage Terms NEW HOMES DATE I LOAN/ CON FEES & TRACT CHARGES EFFEC-)MATURITY I PRICE IIVE I (YEARS) ' iVvTIO (PER RATE I (PER CENT) RATE ' (PER CENT) CENT) 7.48 Oct. 0.95 1.02 0.84 0.83 0.84 0.85 0.83 0.86 0. 86 0.88 0.91 0.92 LOAN AMT. ($000) EXISTING HOMES FEES & CONMATU TRACT CHARGES EFFEC (PER RATE RAT 11) TIVE RITY CENT) RATE (PER (YEARS) (PER CENT) CEM ) ^ 2 26.5 7.53 7.59 28.2 7.37 27. 9 7.39 27.3 Jan. r/ Feb. £ / 0.82 0.79 0.77 0.78 0.77 0.78 0.83 0.81 0.83 0.84 0.84 0. 86 7.48 24.8 24.4 25.1 25.6 ($000) 76.2 26.3 25.2 25.2 25.4 26.4 29.0 29.9 25.6 25.4 Compiled by Federal Home Loan Bank Board in cooperation with Federal Deposit Tnsurar Corporation. Data are weighted averages based on probability sample survey of characteristics of conventional first mortgages originated by major institutional lender groups (including mortgage companies) for purchase of single family homes. Data exclude loans for refinancing, reconditioning or modernization; construction loans to home-builders; and permanent loans which are coupled with construction loans to owncrhuildors. Related series on conventional mortgage rates only, based on unweighted opinions of field-office directors of the Federal Housing Administration, aru availablv somewhat sooner than the results of the FHLBB-FDIC survey, and are included-i of new home mortgage rates--in Table 16. Fees and charges--expressed as a percentage of the principal mortgage amount--includt loan commissions, fees, discounts, and other charges which provide added income to the lender and are paid by the borrower. They exclude any closing costs related solely to transfer of property ownership. r Includes fees & charges amortized over a 10 year period in addition to the contract interest rate.